Will barring ad blockers help the advertising ecosystem?

Wired, Business Insider, The Atlantic and more are turning away site visitors with ad blocking technology enabled. Two experts opine on whether offense is really a better defense.

Publishers are getting more aggressive — some might say desperate — in their opposition to ad blocking, an approach that threatens to undercut their own business models while potentially benefiting advertisers — at least in the short term.  

Ad blocking technology is one of the most significant challenges facing digital advertising today, but it doesn’t hurt every player in the space equally. Marketers and ad tech firms are mostly impacted because their ads aren’t being served but publishers arguably face the most frontline effects with a direct hit to their bottom line, as blocked ads generate zero revenue.

Publishers have taken a variety of approaches to address the ad block epidemic, from politely asking visitors to disable the software to selectively removing text from copy being viewed to reflect revenue lost. But as a more comprehensive picture emerges of the full damage ad blockers can cause, it appears a diplomatic approach might not be working fast enough. 

Some publishers like Wired, Business Insider and Forbes are now completely shutting out any visitors using ad block technology if they don't agree to whitelist their sites. The Atlantic is just the latest to go with this scorched earth policy, taking it a step further by forcing visitors to either disable their ad blockers or pony up for a premium subscription. When the company announced the more aggressive approach, it claimed it was one of necessity, with "multiple millions" of revenue dollars being drained by just 8.5% of the monthly readers who keep ad blockers on.   

While such a blunt strategy may convert those with a deep brand affinity for The Atlantic's content, some experts say it's hardly a foolproof strategy. To better understand the full scope of how ad blocking trends are impacting the publishing and advertising landscapes, Marketing Dive spoke with two experts in the field: Jerrid Grimm, the co-founder of Pressboard, a content marketing firm, and Mark Bauman, the founder of ReviveAds, an ad block circumvention company.

“If we, as marketers, created an app that 25% of the internet was downloading, we’d know we had hit on something truly magically," Grimm told Marketing Dive. "Just because that app [in this case] happens to be ad blocking software doesn’t mean that we shouldn’t look at it in the same way. This is more than a fad, it’s a movement.” 

Gaps in the stonewall approach

With The Atlantic's new strategy as a jumping off point, Grimm immediately caught on to one major problem — it doesn’t actually work the way it's supposed to. 

"If you simply click the ‘x’ in the top right of [the] ad block message you can go ahead and read the article without whitelisting the site or subscribing," he said. "In fact, after you close it you can then go ahead and read any article you’d like on The Atlantic site.”

Another issue is that links directed to the site via social media feeds aren't properly accounted for by The Atlantic, per Grimm. Data collected by Pressboard suggests that, on average, 75% of all traffic to digital publishers comes from social media, making a failure to catch ad blockers funneling in from outlets like Facebook and Twitter a major issue.  

"Even further, the most popular pieces of content — the articles that people might actually whitelist your site for — are almost exclusively driven by social media sharing,” Grimm added. 

While the complete stonewalling — or the attempted stonewalling — of ad blocking users is meant to serve as a wake-up call for readers, it may actually reduce traffic due to its aggressive stance, per Bauman. He recommended an approach that provides ad blocking users with a different set of content than non-ad block users, a tactic that wouldn’t scare visitors away but instead make them more carefully consider their choice to turn the software on.

Separate content is one possible way of better illustrating the value exchange between advertisements and free content models, something that can ultimately help readers understand why ads are necessary to a site's survival. 

And even though a number of high-profile titles are taking the route The Atlantic has, Grimm pointed out that this option isn’t really a feasible one for mid-level and long tail publishers who can't afford to turn away large swaths of readers. The Atlantic, Wired and Business Insider are all bracketed in the top 20 websites for their respective categories, giving them a loyal-enough audience who might whitelist out of pure brand affinity — a benefit many smaller names don't have.

Publishers' dilemma 

Trying to convert ad blockers to subscribers fails to address the underlying problem that made them turn off ads in the first place. One of the reasons users turn to ad blockers is due to annoyance in seeing spots for products they're not interested in via intrusive formats like interstitials. The technology has now been around long enough that users may have a hard time adjusting to seeing ads again if they are forced to turn it off. 

For a publisher like The Atlantic, asking ad blockers to pony up for a subscription in order to access its site will likely only lead to “a handful of unwilling, unhappy new customers,” according to Grimm. 

One possible way publishers can address the problem of ad blocking would be to double down on sponsored content. 

“I believe that you’ll start to see a new breed of publishers crop up focused on a business model supported entirely through branded content instead of display ads,” Grimm said. Recent forecasts from the Interactive Advertising Bureau similarly point to the rise of formats like native, which will likely receive more of the budgets marketers typically put toward display ads heading into 2017. 

Good news for marketers

For marketers and ad tech firms, Grimm and Bauman actually believe they could actually benefit from ad blocking in the short term since the audience actively blocking ads likely wasn’t the most receptive to display messaging in the first place.

“Advertisers are just getting better-qualified users with this, and less inventory,” said Bauman. “The users are also less informed, meaning advertisers will try to get more by them."

"The advertisers and marketers will probably start getting more aggressive as well," he continued. "With less ad space and more competition, rates could go up on regular traffic.”

The biggest concern for brands and advertisers is then less one of a slipping bottom line and more one of low-quality content, as consumers are clearly not latching onto whatever spots they're faced with and are, in fact, making active efforts to avoid them. Longer term, marketers need to address the quality issue or face an ever-growing audience of consumers who distrust and are annoyed by ads. 

For publishers, losing ad traffic can be like losing 1% of total business every month, according to Bauman. However, there may be little they can do about the growth in ad blocking. For The Atlantic and other publishers, this means they should be considering a way to work with ad blockers and not against them. 

"We are seeing extreme changes in the geo makeup of ad block users putting some of these countries which didn't have any ad block usage on the map, up in the 4% to 5% range now like France or India as far as a percentage of total ad block users visiting a site," Bauman said.

Filed Under: Trends