Why New Ad Blockers Will Be Good For Marketing
Apple and Google kicked off June with confirmed decisions to implement ad blocking of certain types of ads for Safari and Chrome respectively. For Apple, the target of blocking is auto-play video with sound, which is embarrassing or frustrating for anyone who does not work in a private office and leaves their computer’s sound turned on. They will also take aim at those creepy ads that follow you around after a site visit, by implementing a “no tracking” feature to hide web surfing from retargeters. For Google, the bad actors will be the entire web site if that domain permits any low-quality ad experiences, including auto-play video but also full-page interstitials, and flashing ads.
In the name of user experience on the internet, these are moves to be applauded. According to PageFair, 600 million mobile and desktop devices already have ad blocking software of some kind. As now-retired columnist Walt Mossberg wrote in January on The Verge, the user experience on the internet is broken, and ads are to blame.
Marketers Win, Ad Tech Loses
- The implication for ad tech is not great. The sector is already suffering from quality issues and consolidation, and publishers are combatting declining CPMs and programmatic selling disintermediating their sales force and revenue stream. These browser changes will remove bad actors, bad experiences and bad inventory from the system, which is already under pressure from Google and Facebook taking the lion’s share of spend. While retargeting has been a boon to marketers, it has been the standard of the “creepy factor” in nearly every presentation on what’s wrong with digital advertising since the approach was launched by Criteo 10+ years ago.
- The implication for high quality publishers is better. This forcing function to quality advertising will decrease competition with rogue web sites, reduce the nearly limitless supply of ad space, and shore up prices for publishers that maintain a good experience. It doesn’t completely save the ad-supported publishing model, but it starts to make good inventory more valuable.
- Lesser publishers who depend on 3rd party ads will take a hit. The publishers that have made passive money off of ad tags for the last 10 years, enjoying the revenue stream but devoting less attention to the reader experience, will suffer from not being able to woo enough customers to give the OK to them to serve ads. The long tail of content will follow the long tail of ad tech into a winnowing down of the random players.
For marketers, this is a win, with better quality placements and higher impact. To break it down:
- Digital inventory quality will improve. With firms like Vodaphone developing a white-list approach to approving sites, rather than a black-list approach to removing them, quality digital ad inventory is going to get tighter. While marketers will still negotiate on price, they will be willing to pay more to show up in clean, well-lit places, and track the impact on their business more simply.
- 3rd party ad blocker growth will slow. The sites like The Guardian, Forbes, and Ad Age that ask readers to turn off ad blocking are often met with the same ad-laden experience once they land on the site; they are not holding up their side of the bargain. But with browsers improving overall digital experiences, consumers will find more reason to keep their ad blocking to browser tools, and be exposed to ads again online.
- Decreased clutter will allow remaining ads to shine through. With publishers cleaning up their sites (encouraged by rising CPMs and better experiences reducing the impact of 3rd-party ad blockers), brands will see better results from the ads they do show. Share of voice on a good publisher site will go from 1 in 10 to 1 in 2 for sites that care about visitors having a positive content-to-ad ratio.
- Unit prices will go up, but so will business impact. Ad pricing is a constant battle for marketers, as the tradeoff between quality and volume often leads to “spray and pray” tactics. Ads that wind up on better sites, with better targeting and higher share of voice will cost more, of course. But ultimately, sales is a more important factor in digital advertising than unit price, and ROI is stronger when the “R” is bigger.
Please comment here or @minicooper and follow me below.