Will Ad Blocking Deal The Final Death Blow To Already Failing Online Advertising?

Will Ad Blocking Deal The Final Death Blow To Already Failing Online Advertising?
SHARE
THIS



Online advertising has had it tough over the years, and David Glance, director of UWA Centre for Software Practice at the University of Western Australia questions whether ad-blocking software will be the end of online ads?

This post originally appeared on The ConversationDavid Glance, University of Western Australia

Advertising represents 90% of Google’s $USD 66 billion in annual revenue. What makes this figure especially astounding is the suggestion that the vast majority of web advertising may never actually be seen by end users, and if it is, is largely ineffective.

Google, Facebook and other online advertising companies, are less worried about the effectiveness of ads and are more concerned that they show the ads to users in order to bill their customers. This business is being made harder however as a result of the rise in the use of ad blocking software in the past 10 years.

Ad blocking

Ad blocking software basically applies a list of filters to every web page that is loaded and either hides the ad from showing, or blocks the request to the site that hosts the ad. Not all ads are blocked however. Depending on the software, some sites and their ads can be “whitelisted” and allowed to show. Adblock Plus for example, applies a principle that it is only “bad” advertising that should be blocked. Bad ads are those that do not fit a set of criteria that advocates that ads should not be annoying, intrusive, should not distort the page that they are embedded in, and are appropriate for the context. Companies that produce “good” ads can then pay Adblock Plus to have their ads whitelisted.

uBlock, another popular ad blocking software plugin for browsers, simply blocks anything that looks like advertising.

Ad blocking software is now used by 25% of users in the US, increasing to 40% of users in countries like Germany.

Native advertising

Partly in response to the decline in effectiveness of traditional online ads, advertisers have turned increasingly to native advertising. Native ads have been around for some times. They can span from the placement of products in a TV show or film, through to sponsored articles or posts on social media that are written to look like they are part of the normal content of the site. Sponsored tweets on Twitter and posts on Facebook have become more prevalent and have been shown to be far more effective than banner or search-based ads. However, even though these types of ads are more effective, those on social media at least, are still considered not terribly so.

Here again, users are turning to software to remove native ads. On Facebook, products like Facebook Purity give the user a high degree of flexibility in removing advertising from Facebook on the web.

Advertisers in Germany decided to tackle the problem of ad blocking head on by taking Eyeo, the company behind Adblock Plus, to court. This avenue was shut down, at least in Germany, when the Munich court ruled that ad blocking was indeed legal.

The threat to mobile

If matters on the web were not bad enough, advertisers face an even bigger problem on mobile. Several telecommunications companies are in the process of deploying ad blocking software to their mobile networks. One technology that they are using is from an Israeli startup called Shine that works at the level of the mobile network to block ads.

From the mobile carrier’s perspective, advertising has been estimated to use anything between 10% and 50% of a mobile phone users bandwidth which ultimately the end user is paying for. Ironically however, the telecommunications companies are possibly seeking part of that income by forcing companies like Google to pay them a share for ads transmitted on their networks. Even if this doesn’t succeed, the carriers can switch on ad blocking to enhance the service for their users or charge them for an ad-free environment.

An ad-free world?

If ads are successfully blocked in the mobile world, which is seen as becoming the dominant platform for advertising in the future, Google, and others, contend that they will need to start charging for software that has been provided for free but funded through advertising.

From an end user perspective, moving from a free service to a paid one would actually be a good thing because it would make the relationship between the user and companies like Google more explicit. It is hard to argue that it is acceptable to secretly track users and capture their personal details when the user is paying for a service. Whether this model is going to be as financially lucrative for Google as selling ads is yet to be seen.

Advertising, even invasive and disruptive ones is not going to disappear overnight. In-app advertising provided on Android and Apple devices is going to be harder to block, even at the mobile carrier level. Advertisers will move increasingly to native formats which are harder to block. In the online landscape where competition is global and there are only a few gatekeepers who control the platform for advertising, it is hard to see how to arrive at a solution that will keep all parties in the equation happy.

David Glance is Director of UWA Centre for Software Practice at University of Western Australia.

This article was originally published on The Conversation.
Read the original article.

Please login with linkedin to comment

Latest News

Kellogg’s Creates AR Halloween Trick Or Treat Experience Via Shazam & Orchard
  • Campaigns
  • Marketing
  • Technology

Kellogg’s Creates AR Halloween Trick Or Treat Experience Via Shazam & Orchard

Breakfast cereal manufacturer Kellogg’s has joined forces with Shazam and digital agency Orchard to deliver a first-of-its-kind augmented reality (AR) Halloween Trick or Treat experience for families. The campaign, which leverages Shazam’s visual recognition platform and recently-launched AR platform, sees Kellogg’s pilot the replacement of physical gifts in cereal packs with a digital experience that […]

Kraft Heinz Appoints Cummins&Partners As New Creative Agency
  • Advertising

Kraft Heinz Appoints Cummins&Partners As New Creative Agency

Kraft Heinz today confirmed the appointment of Cummins&Partners as its new Creative agency after an extensive pitch process. They will be responsible for brand strategy and integrated creative across the expanding Kraft Heinz portfolio including Kraft, Heinz and Golden Circle. A Kraft Heinz spokesperson said: “After an exhaustive search involving a competitive pitch, we have made […]

Patrick Delany (CEO, Fox Sports), Hugh Marks (CEO, Nine Entertainment Co), Miranda Devine (Columnist, News Corp), Michael Miller (Executive Chairman, News Corp Australasia), Grant Blackley (CEO & Managing Director, Southern Cross Austereo) at Radio Alive 2017
  • Media

Media Bosses Weigh In On Ten-CBS Deal

Do you enjoy articles featuring industry big-wigs? Well, it doesn't come much bigger and wiggier than this, we say.

by B&T Magazine

B&T Magazine
Kantar TNS’ Ali Dexter Joins T Garage As Director Of Insights & Strategy
  • Marketing

Kantar TNS’ Ali Dexter Joins T Garage As Director Of Insights & Strategy

Melbourne-based market research consulting agency T Garage has announced the appointment of Ali Dexter as its director of insights and strategy. Dexter joins T Garage from Kantar TNS, where she was the director of its Qualitative division. Prior to that, Dexter held a number of senior roles at Kantar TNS in the US and Vietnam.  “After […]

XXXX on Tuesday, March 21, 2017, in Las Vegas. (Jeff Bottari/AP Images for Adobe)
  • Advertising

Adobe Releases Advertising Cloud App

Not one, but two Adobe announcements. The tech elves have been busy this week, not that we're inferring Adobe is Santa.

Facebook Updates Its VR Offering
  • Technology

Facebook Updates Its VR Offering

Do you loathe Facebook for nicking all the ad cash? Well, why not scream "A pox upon you Zuckerberg" while reading this.

InterContinental Perth City Centre Chooses Bonfire To Build Digital Strategy
  • Marketing

InterContinental Perth City Centre Chooses Bonfire To Build Digital Strategy

Luxury hotel InterContinental Perth City Centre is officially set to open this Sunday, and has already taken strides towards developing a comprehensive online search strategy with digital agency Bonfire. The investment reinforces the desire of the hotel to promote its luxury business facilities, which include corporate and bespoke event spaces designed for local, national and […]

Datalabs Announces New Hire And Promotion
  • Marketing

Datalabs Announces New Hire And Promotion

Aussie data visualisation and content marketing analytics agency Datalabs has announced the appointment of Marc de Chellis to run its business development, as well as the promotion of Cass Lilley to accounts and project manager. De Chellis (pictured above, second from the left) joins Datalabs from Launchpad App Development, where he held the role of […]

OLYMPUS DIGITAL CAMERA
  • Advertising

Inskin Grows Sydney Team With New Designer

Digital advertising provider Inskin, continues to expand its Sydney team, hiring Marc Gundesen as a junior digital designer. Gundesen (pictured above) brings a breadth of skills in web design, animation and account management, and will report to Inskin’s lead designer, Jay McCalla. He joins Inskin from Budgy Smuggler, where he worked as a graphic designer, […]

Agent99 PR Signs Finance Industry Thought Leader Vanessa Stoykov For TV Show Launch
  • Marketing

Agent99 PR Signs Finance Industry Thought Leader Vanessa Stoykov For TV Show Launch

Independent communications agency Agent99 Public Relations has welcomed respected founder of No More Practice Education and founder and CEO of Evolution Media Group, Vanessa Stoykov, to its client stable. Agent99 will be supporting the launch of her Learn from the Money Masters – The Investment Series show on Channel Nine. Stoykov has over two decades […]

Susie Porter & Jacki Weaver Lend Support To Young Filmmaker In Crowdfunding Campaign
  • Media

Susie Porter & Jacki Weaver Lend Support To Young Filmmaker In Crowdfunding Campaign

A new crowdfunded short film is shining the light on barriers for women filmmakers, thanks in part to Aussie actresses Susi Porter and Jackie Weaver. Starring Porter, Beverly explores a bizarre love triangle in middle-class suburbia. It is an unflinching coming-of-age comic drama exploring sexual awakening in the era of technology, and the universal yearning […]