Ad Blockers: A Mounting Horror for Marketing ROI

October 15, 2015 Marc Wasserman

Ad Blockers: A Mounting Horror for Marketing ROI

Who has the most to lose with the ad block revolution? Media sites and publishers, undoubtedly. The calculated loss of revenue for publishers in 2015 because of ad blocking? $22 billion, according to PageFair’s latest report.

Ad blockers have the Internet in a chokehold, and media sites are the ones being squeezed. To a lesser (yet still significant) degree, however, ad blockers are impacting marketing ROI as we know it. Skyrocketing in popularity across the globe, they are spreading in use across all forms of media, from display to the burgeoning video market. Publications need their money, advertisers need a place to spend it, and ad blockers are happy to siphon from both sides.

The infrastructure of the Internet is buckling.

I’m being hyperbolic, of course. The media has proudly announced the Internet’s death throes since the day two computers first talked to each other, but there is one undeniable fact: A great change is coming to online marketing and content measurement, and ad blockers are a major catalyst.

Cleansing Fire

Ad blockers prevent ad content, trackers, and sharing widgets from loading. They take the intrusiveness out of the Internet—the same intrusiveness that has allowed online marketing to flourish and the wheels to keep turning at hundreds of thousands of publications.

About 16 percent of those who use the Internet in the United States, or 45 million people, have already installed an ad blocker, up 48 percent over the last 12 months, as reported by PageFair.

As publishers turn to producing video content more, the impact of ad block is still felt. According to a newly published report on ad blocking by Secret Media Inc, in the US, over one-quarter of time spent watching videos online is unmonetized because of ad blockers, effectively pulling one of the fastest growing content segments out by the roots.

Unmonetized video time due to adblock: global

Neutering the marketing potential of an entire branch of content creation is one thing, but another threat has emerged as well: Custom marketing streams like Facebook are adjusting their ad display methodology in ways that directly threaten marketing ROI. For example, Facebook’s ad offering to brands is getting tighter.

As was recently written in Ad Age, “Sometime later this year Facebook will begin letting advertisers only pay for an ad if 100 percent of it appeared on a person’s screen. But there’s no requirement on how long an ad would need to be in view before an advertiser is charged, according to a Facebook spokesman.”

This might not sound too bad, until you realize that all of these ads appear directly in the News Feed and are impossible to avoid by the 40 percent of Facebook users who view it on mobile. Every person who scrolls quickly through their News Feed on mobile could be speeding past these ads in a blur, with zero guarantee of a user’s attention. These ads are in a prime location, so they don’t come cheap; they can cost anywhere between a $2.30 and $6.25 CPM, with no guarantee on the exact amount (you can only specify the daily budget).

Shift Communications Facebook Mobile Study

With some publishers operating on a margin as low as 10 percent, and many small publishers receiving up to 75 percent of their income from display advertising, adaptation has become unavoidable. Maybe this is a good thing.

A Phoenix Rising

Marketers are used to turmoil at this point, and there are plenty of them who thrive in disruptive environments. Newspapers, radio, television, and the Internet are all different landscapes, with the most forward-thinking brands adapting to immense change; the current content marketing battlefields are just more specific. Now, instead of entire industries, it’s mediums within the industry: social media, video, display, etc.

Enterprise marketers can rise above any turbulence by concentrating on the giants in the business, marketing on focused content hubs like the International Movie Database and ESPN to target their audience en masse. Although huge publishers might seem like they are insulated from the ad block has on display, the truth is, ad block affects media sites of all sizes. To try and temper the blow, many publishers are beginning to utilize native advertising and slide under the ad-block sensors with sponsored content.

The most agile marketers are carving niches out of every corner they can, using the dwindling ad numbers to help them focus their products on an increasingly niche audience where the marketing ROI is fantastic. They’re building personal relationships and communicating directly with their clients instead of creating impersonal display ads and hoping for the best. Creating a direct line of communication with clients, tossing out the sales pitch, and promoting the brand’s story through organic means… these are all techniques renowned marketer Guy Kawasaki recommends to boost marketing ROI by turning normal ad buying techniques on their head.

Revenue models may be experiencing a cold war with ad blocking technology, but good marketers always seems to find a way to reach their audiences. The right mix of broad strokes and narrowly focused campaigns should keep ROI manageable, even though it’s getting trickier.

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