Why ad blocking is coming soon to a mobile device near you

While the ad blocking debate has largely played out on computers so far, there are signs that mobile is where the real battle will take place.

Ad blocking is a serious problem facing digital advertising today, with eMarketer predicting that 26% of U.S. internet users will use ad block software this year, a 34% increase year-over-year. But while ad blocking technology already has significant penetration on desktops across the country, it's not as big of an issue on mobile... at least, not yet.

New reports, however, suggest that ad blocking is quickly shifting from desktop to mobile. The 2016 Reuters Digital News report found mobile ad blocking only has 8% penetration, but that number is set to change: A third of respondents to that survey reported they plan on adopting mobile ad blocking within the year. Perhaps most distressing for the online ad industry, the highest rate of ad block tech adoption was in the under 35 demographic worldwide.

But while adoption is already growing fast, the numbers suggest the surge of mobile ad blocking in North America and Europe has yet to come.

Mobile ad block adoption is growing fast

As consumers increasingly rely on their mobile devices for a variety of purposes, mobile ad blocking penetration is likewise on the rise.

To put some data behind the problem, PageFair released a report called “Adblocking Goes Mobile." The report found about 419 million people worldwide are blocking ads on their smartphones—a whopping figure that easily surpasses the nearly 200 million people found using ad blockers on desktop the previous year, when PageFair put out its joint report with Adobe on the state of ad blocking.

“This new report highlights something we’ve been discussing in the industry for a while now: consumers are pushing back on mobile and online ads,” said Nancy Hill, CEO at the agency trade association 4A's, about the PageFair report. “Now is the time for advertising professionals and marketers to take a hard look at ourselves to understand why consumers are not responding to these types of ads, and figure out how we can correct the issue to better engage with the consumers we’re trying to reach.”

The report found that most people block mobile ads via their mobile browsers, with ad blocking capabilities becoming an important differentiator in the mobile web browser market. Last September, Apple announced that its iOS 9 release would include ad blocking capabilities, and this February, Samsung released a content blocker API for Android devices. Meanwhile, Firefox for Android has almost 18% ad block adoption, according to PageFair, while Opera Mini for Android has native ad block capability and Maxthon browser reported last February that as many as 20 million users have added ad blocking capabilities.

But while ad blocking is occurring primarily through mobile browsers, it's also emerging within mobile apps. Ad blocking is part of the in-app experience through HTTP proxy, which only works over Wi-Fi connections, and over VPNs, which work on Wi-Fi or cellular connections, according to the PageFair report. In-app ad blocking technology is also available on both iOS and Android devices.

The report found mobile ad blocking has less penetration in North America and Europe than in the rest of the world—where consumers often rely on smartphones more than desktops. While mobile ad blocking penetration increased 90% overall in 2015, China and India far and away led the pack.

With plenty of room for mobile ad blocking to grow in the North American and European marketplaces, mobile ad servers and publishers should be concerned. The findings suggest that as consumers' reliance on mobile devices increases, so too will mobile ad blocking, especially in North America and Europe, where the practice—at least on mobile—has not yet fully taken hold.

The trendline should be daunting for anyone in the advertising business, with mobile set to only grow in importance as a marketing channel.

“The industry needs to reflect on the rise of ad blocking," said David Wheldon, CMO at RBS and president at the World Federation of Advertisers (WFA). "Advertising has always been cultural wallpaper and we have a duty of care to make it as attractive and engaging as possible so that people enjoy it, not want to shut it out.”

What the ad industry can do

It’s not that the advertising industry overall doesn’t know what to do about ad blocking—they just don't know how to do it.

A poor user experience is the primary reason many consumers adopt ad blocking technology, according to several studies. A poor user experience—whether it's too many ads, ads that are too easy to tap, or ads that are fraudulent or contain malware—is driving adoption of ad blocking on mobile devices, especially among younger demographics. As these younger demographics grow in age and spending power, the problem is only set to get bigger.

A recent report from the Interactive Advertising Bureau, Kargo and Refinery29 found that 73% of surveyed marketers agreed that the digital user experience needs to improve. But it's not clear companies know how to deliver a good user experience: Over 50% of customer experience decision-makers believe their organizations lack the skills necessary to deliver on the user experience, according to a survey by Accenture Interactive and Forrester Consulting.

So far, the advertising industry has often taken an adversarial stance on ad blocking adoption. But some in the industry believe that's a mistake.

"Whether you look at Uber, Airbnb, TiVo (DVR’s), Netflix, or music streaming ... consumer demand always prevails over entrenchment of the establishment," Jerrid Grimm, co-founder of Pressboard, previously told Marketing Dive. "Why would we expect ad blocking to be any different? If this becomes a technological arms race, we’re putting our bet on the consumer winning the war."

It's still unclear what a real solution to the ad blocking problem looks like, but one thing is clear: The problem isn't getting any better and it's quickly coming to mobile. Everybody get ready.