With almost 620 million users worldwide, the application of ad blockers continues to grow exponentially, representing another major hurdle for digital publishing and marketing. Or could it be a catalyst for the evolution of a more effective model of online advertising?
As if persuading marketers to advertise online and readers to pay for content is not challenging enough for publishers, the use of ad blockers is growing – expedited when Apple enabled ad blocking on mobile devices using iOS 9 and, more recently, by Samsung, which included support for ad blockers on its Galaxy phones in February this year. And with the software, which blocks ads from being loaded by browsers, becoming increasingly sophisticated and available, the number of monthly active users is expected to keep rising.
According to PageFair and Adobe’s third annual global ad blocking report, the use of ad blockers grew by 41% year-on-year from June 2014 to June 2015, to almost 200 million active desktop users, costing publishers nearly US$22-billion. In another report with Priori Data released in May 2016, PageFair found 419 million people are blocking ads on their mobile devices.
Consumers use blockers because they find ads interruptive and annoying. Large ad files slow the loading of pages, so ad blockers help speed up performance. Consumers also like the idea of obstructing access to private data via trackers and cookies associated with ads. Moreover, they use ad blockers to prevent wasting data, particularly where data is expensive, as in South Africa.
“Actually, ad blocking has not yet become a big issue in South Africa, partly because we do not have the same level of intrusive advertising seen elsewhere in the world, but also because most South Africans – who mostly view media on mobile devices – use Android phones and not iPhones,” says head of digital at Times Media Group, Lisa MacLeod. “But, whereas in other countries, people block ads because they find them irritating, South Africans are more likely to do so because of the high cost of data. There is a real and significant cost to downloading ads along with content.”
Scoring an ‘F’ in remarketing
Chief executive officer of online advertising network MemeGlobal Africa and Southeast Asia, Brent Tollman has a different take on why ad blockers are on the rise. Not only are ads considered intrusive and expensive, and delay browsing; publishers are doing a poor job of remarketing, the process of showing ads to people who have visited your site or used your app.
“Ad blocking is mostly due to the media industry not taking consumer concerns seriously or responding to them fast enough,” he says. “And what amplified it? Two things, namely badly executed remarketing and mobile usage.
Digital publishers are only as good as their tactical approach, data and creative. Great remarketing is great salesmanship, which means if customers don’t like the product you’re advertising, you need to show them other relevant options… Great sales people can generally read their customers. Digital media has to do the same or consumers will go out of their way to avoid advertising. When remarketing is an endless repetition of one product or product range – a common practice – this annoys consumers to the point of using ad blocking.”
The second primary factor driving ad block downloads, says Tollman, is that more people are accessing the web from their mobile devices. A survey by global agency, We Are Social shows that mobile phones accounted for 61% of the share of web traffic in South Africa in 2015, while desktop computers and laptops accounted for just 32%.
“Increased smartphone penetration and usage means more mobile ads, which consumers can find more intrusive than on other devices – particularly if they’re badly targeted,” says Tollman. “Mobile ads take up more screen space than laptops and tablets, and often you can’t scroll past them. Worst of all, badly optimised mobile ads waste the consumer’s internet data.”
But, says managing director of technology consultancy World Wide Worx, Arthur Goldstuck, ad blocking is “a double-edged sword”. While protecting readers from unwanted interruptions, it also robs the digital media industry of the ability to generate revenue from readership, thereby reducing the viability of offering content at no cost.
“The double-edged sword is that, while ‘free’ viewing could be blocked, it could also affect readership numbers and therefore ad rates,” he says.
According to a study by US web optimisation company, Optimal.com this year (from January 1 to February 13) 9,9% of South African internet users are active ad blockers. This number is expected to rise as more users rely on smartphones as their primary portal to the internet. It is therefore a good time for local publishers, advertisers and agencies to come up with new ways of delivering advertising online.
“There needs to be a middle path, and it will not be achieved merely by blocking viewers who use ad blockers and not doing something about the way advertising is displayed,” says Goldstuck.
Further bad news for publishers worldwide is that international mobile operators are also considering using ad blockers. In February, telecoms company Three began using ad blocking software developed by Israeli company Shine to block ads en masse across its networks in the United Kingdom and Italy.
“Other overseas telecom companies are considering blocking ads en masse because they have realised that in some cases up to 30% of their packages of bandwidth is used up serving ads,” explains MacLeod. “They do not make any profit on this – only the big players like Google do – and neither do their customers benefit. So they are saying to their customers: ‘We will block the ads and you will be able to use that bandwidth instead of advertisers doing so’. Reducing load on their networks will result in cost efficiencies for operators, which they can pass on to consumers. It’s a compelling case, but potentially devastating for publishers.”
Fighting on all fronts
Because publishers stand to lose the most from ad blocking – the PageFair-Adobe report expects this to amount to US$41.4-billion in 2016 – they are leading the anti-ad blocking battle.
“If publishers allow ads on their sites to continue to obscure content, slow down websites, pry into data, and break the audience’s trust, then a large technology platform company like Facebook or Apple will have the opportunity to step in and set the rules,” says programmes communicator and editor of the World Association of Newspapers and News Publishers (WAN-IFRA), Cecilia Campbell.
Together with trade organisation Digital Content Next (DCN), WAN-IFRA established a task force and forum comprising international publishers, marketers and consumer bodies. Its objective is to redefine how advertising works and save the mechanism of advertising, which supports content on the internet.
The initiative is based on the understanding that the use of anti-ad blockers to fix the ad blocking problem is not the solution for publishers and their advertisers; preserving the user’s ad experience is. A key advantage is that publishers have a direct relationship with consumers – that is, potential and active ad blockers – which presents them with several opportunities.
Firstly, there is the preventative approach whereby publishers and marketers work together to improve overall ad experience, so readers do not install ad blockers.
Key to this, says Tollman, is the use of targeting data, which can be expedited by using an effective data mining platform that helps ensure ads reach the right audiences at the right time and place with context and appropriate messaging.
“Creating that kind of serendipity or affinity means consumers won’t be annoyed and won’t take drastic measures like installing an ad blocker,” he says. “Better data is at the heart of this. It’s critical to track industry activity, campaign performance and billions of user profiles – right down to the models of mobile devices they are using. That way we know exactly what size of video ad to serve them. As a company, we’re focused on developing sensitive digital media using advanced algorithms to predict exactly when to engage consumers, how to adapt the messaging to their needs and when to leave them alone.”
There is a caveat: “The best targeting in the world won’t make up for unlikeable creative. Our maths can give creative the best possible opportunity of being liked and even acted on, but the creative still has to speak to the consumer’s pain points and shared values,” says Tollman.
Indeed, digital publishers and their agencies are exploring a multitude of anti-ad blocking techniques. A study conducted by C3Rearch earlier this year found that 20% of consumers not currently blocking ads are past users of ad blockers. In other words, it’s possible to convince people to change their minds.
One way of doing this is for publishers to communicate the purpose and value of advertising with readers, many of whom might not know how digital media works. For example, South Africa’s Daily Maverick news site adds a line to some of its interstitial ads saying, “Busy paying for your free read. This advertising message will self-destruct in 5-4-3-2-1…”
Other communication could focus on premium content, explaining that it requires revenue to survive and giving users reasons to disable ad blockers and even purchase digital subscriptions. Several publishers have adopted this technique, including the Washington Post, which blocks some content from users of ad blockers and asks them to disable blockers for full access. Further opportunity identified by DCN and WAN-IFRA’s ad blocking initiative is the promotion of apps that are not impacted by blockers.
Time to form a coalition
MacLeod, who previously took the Financial Times (FT) through the successful process of making digital work, is among those who believe more can be done by focusing on mobile-ready advertising.
“It is a conversation that needs to be had,” says MacLeod. “Advertisers and publishers need to work together to reconsider the advertising model – not only to improve the ad experience to counter ad blockers, but also to reach the growing number of people who read on their phones. Entry-level digital consumers are unlikely to ever know a desktop, or even have an iPad experience – they will go straight to smartphones. This is where the value lies.”
The positive thing, she says, is that consumers largely have excellent relationships with their phones, which function as essential utility tools and positive social tools for most. Accordingly, mobile advertising actually outperforms desktop advertising because the message and delivery are perceived as more personal. This was recently demonstrated by research conducted by Schibsted Publishing in Sweden, when it surveyed 37,000 of its mobile users in the first half of 2015. The study concluded that while it may not force people to buy, if the right message is conveyed in mobile advertising, there is a greater influence on consumer decisions than if the ad were displayed on a desktop or laptop – a very powerful message for advertisers.
The publisher-advertiser conversation will ideally address several topics. How South African marketers measure the reach of their online advertising – that is, via clicks and impressions – is crude and out-dated, and needs to be reviewed. Attention-based advertising deserves greater consideration. Where ads are placed – their position on a page or in a mobile experience and in relation to the accompanying content – is important. Content that holds a user’s attention is the most viewed.
Ad blockers also present new opportunities for branded/sponsored content and native advertising that looks and reads like content, thus enabling it to more successfully bypass ad blocking filters. Key here, says MacLeod, is creativity and quality.
Tollman concurs, adding, “We’re seeing an uptick in branded and native content. MemeGlobal recently included (content discovery platform) Outbrain on our platform, which means we not only launch ad campaigns, but can also now syndicate public relations and branded content.”
But, says MacLeod, while these forms of advertising are designed to evade ad blockers, publishers need to guard editorial integrity closely. Quality of content must be maintained by ensuring news content and advertising content is always separated or clearly flagged.
“There are interesting times ahead,” she concludes. “With more and more smartphones being used in Africa, it is more important than ever that apps and mobile products are top notch. They need to be fast and slick, and light on data costs. And, aside from working with advertisers to redefine the advertising model, publishers need to continue to work on getting readers to be comfortable paying for content in one form or another. We might have a grace period as far as ad blocking is concerned – in South Africa we generally feel the fallout of everything a bit later than elsewhere – but I believe it will come, and we need to be ready.”
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