It’s referred to by some industry commentators as ‘banner blindness’ – the process whereby website users unconsciously skip or ignore banner ads.
While the first banner ad managed to achieve a 44 per cent CTR, today, this figure sits at around 0.05 per cent. In other words, a marketer can expect five clicks per every 10,000 impressions achieved.
And according to the founders of media technology company WINR Marcelo Ulvert and Perry Lyndon-James, these numbers suggest the industry is in need of change.
That’s why they have created advertiser-funded paywall AdGate, a hybrid between the free ad-funded model and traditional paywalls.
Rather than traditional banner ads or a paywall, readers of the partner sites are presented with an interactive ad – usually a branding question – embedded partway into an article. They are able to unlock and instantly read the remaining content in the article in exchange for one-interaction with the advert.
Early data shows AdGate is achieving between 30 and 45 per cent engagement rates for partner publishers which so far include nextmedia, Interplay, Tribal Football and Dynamic Business.
According to Ulvert, it’s all about “valuing human attention and engagement with brands, rather than just impressions.”
The founders have called it a “win-win-win” for publishers, brands and consumers
“As far as the publisher is concerned, they’re getting better yield,” said Ulvert. “Therefore, they can fund their content more easily.”
“The advertiser is getting higher engagement and higher interaction rates, therefore they’re getting a better bang for their buck and evidence that a consumer or a reader is actually seen, and engaged with their advert.
“And for the reader, they’re one click away from accessing the content they love and it keeps it free for them.”
After trialling the paywall for over a year, Ulvert and Lyndon-James launched the product last month – at a time where many media businesses are fighting for survival.
Although the timing isn’t ideal, Ulvert believes a solution like AdGate can help the media industry navigate this period.
“We didn’t intend to launch right now,” Ulvert said.
“But right now, with budgets smashed in the way that they are, it’s important that we have innovative technology that is providing a better outcome for publishers, advertisers and readers.”
the problem with impressions
With its focus on attention over impressions, AdGate calls into question the current CPM-based model that marketers work with.
The WINR founders don’t expect their technology to eradicate CPMs, but they hope it can change the conversation.
“CPM or impression-based models are the major currency in that respect,” said Lyndon-James.
“We would certainly like to see the industry move more towards a customer engagement or customer interaction model, which values attention slightly more.
“But I think that’s going to be a long process, and we’re certainly excited to be the first ones here sort of advocating this model.”
