Subscribe

Ad-blockers hurt multibillion-dollar industry

Admire Moyo
By Admire Moyo, ITWeb's news editor.
Johannesburg, 01 Oct 2015
The rise in ad-blockers comes at a time when the Internet has become the fastest growing advertising medium.
The rise in ad-blockers comes at a time when the Internet has become the fastest growing advertising medium.

Ad-blocking software is threatening to hurt the multibillion-dollar global online and mobile advertising industry.

Although ad-blocking software has been around for years, its use is growing. Some 200 million people used ad-blockers last year, both on desktops and mobiles, up 40% from a year earlier, resulting in $22 billion in lost advertising revenue, according to a global study by Adobe and PageFair, an anti-ad-blocking tech company.

Apple recently enabled ad-blocking apps through its new mobile operating system, iOS 9. Users are embracing the blockers after long complaining that the ads track them, slow down Web browsers and are annoying. Within hours of iOS 9's release, ad blockers had shot to the top of Apple's list of most popular paid iPhone apps.

Little awareness

Yaron Assabi, founder of Digital Solutions Group and chairman of the South African Mobile Marketing Association, says while the ad-blocking trend is expected to see significant growth in other markets - more so Asia and the West - it's unlikely it will see significant pick-up in Africa within the next five years.

"The reality is that in Africa - and even in South Africa - we are still behind the digital curve in many respects, where currently there is very little awareness of ad-blocking software among the broader consumer markets. And, at this stage, this is still in the favour of marketers and online or mobile publishers," says Assabi.

"In fact, beyond South Africa, most African consumers leapfrogged the desktop and their first point of Internet access has been a mobile phone. As a result, most African Internet users haven't been inundated or bombarded with irrelevant ads, where they are novice users and feel comfortable with mobile ads."

However, he notes marketers as well as online or mobile publishers that wish to maintain customer loyalty and avoid being affected by ad-blocking need to strategise their own customer experience.

Mike Wronski, MD of Fuseware, believes ad-blocking poses a threat to mobile inventories in SA, as there are already several apps available that switch off mobile ads completely. "Apple is also supporting ad-blockers on its mobile platform, as this enhances the experience for users, loading sites faster, and consuming less data overall. Publishers need to become far savvier with how they monetise their mobile inventories."

He points out that with ad-blockers, Web publishers primarily lose out on ad revenue as the blockers cripple their primary monetisation channel. "In the end, everybody loses as publishers can't create quality content due to lower revenues, and consumers stop getting the quality of content they expect."

Wronski explains that advertisers have continuously pushed for larger reach at the expense of relevance, and publishers have pushed for larger revenues for the same content, resulting in a plethora of irrelevant advertising on the Internet.

"It's only natural for consumers to want to block these ads as it degrades the quality of their Web experience," he points out.

Fearful reaction

Faced with the threat of ad-blockers, some publishers have adopted a fear-based response whereby they block traffic when an ad-blocking plugin is detected, or migrate content behind a paywall, he notes.

"Both of these strategies have disadvantages, and I would rather suggest exploring more user-centric partnerships with advertisers that allow for high-quality brand-sponsored content that readers would not want to block.

"Consumers don't mind advertising when it's relevant, timeous, interesting and engages their interests. Until advertisers create ads that appeal to these qualities, consumers will keep on blocking ads."

For Brian Mdluli, CEO of WiTaxi, ad-blocking presents a challenge to marketers but does not fully restrict campaigns to be implemented.

"It is my view that ad-blocking is a right that consumers have and can use it very much like the direct marketing opt-out. Ads provisions, particularly on free WiFi hotspots, is what funds the free connectivity that users enjoy. We are seeing a steady rise in interaction on free WiFi hotspots."

Assabi believes that in some respects brands, marketers and publishers, alike, continue to underestimate the dynamism and adaptability of the consumer in the 21st Century.

To succeed today, he says a product or service, along with how it is marketed or communicated, needs to be 100% centred on the customer experience.

"By this, I mean brands and marketers shouldn't be 'talking at' their target market, but rather engaging with them and providing them with content or material that is relevant and meaningful - as well as keeps data costs top of mind. If brands and marketers can get this balance right, Africa's growing number of mobile Internet users are unlikely to jump aboard the ad-blocking bandwagon," he notes.

Share