A few weeks ago The METISfiles reported on the intensified battle in the world of advertising. While it seems that the fight is limited to adblock software developers on one side and publishing, media and advertising agencies on the other hand, there is more to it. Let’s take this from the top.
To sell stuff as a vendor of goods and services you need to communicate with your audience. If nobody knows, nobody buys. Based on this principle a multi billion euro advertising industry has emerged. In fact it could be argued that in some sectors more money goes into marketing/communication than in the product or service itself, resulting in higher prices, paid for – of course – by the buyer.
Advertising works! And so does digital advertising. This is the message that the advertising industry is hammering down on its clients. And it is true. Studies show that online advertising positively impacts sales; in an in-depth study by Nielsen on the impact of online advertising it is concluded that for every dollar spent on online advertising almost three dollars is generated in incremental sales. Apart from the ROI of online advertising there are more benefits such as the capability to track the audience, the cost effectiveness compared to off-line advertising and increased synergetic effects with other media.
From the above it can be concluded that to increase sales online advertising is an absolute must. More is even better, according to the advertising industry. It is therefore important for them to show that online advertising is and remains a very effective method for companies to communicate with their audience. So what about the (consumer) audience?
Some consumers really like ads on TV, or in newspapers and magazines. Ads can be nice to watch or look at, as long as they are not overly intrusive and/or endlessly repeated. But the consumerization of online-advertising is creating a new situation. Ad prices keep falling while expectations from advertisers keep on rising. The cost to start with online advertising, where pay per click or pay per conversion is the rule, is much lower than traditional offline advertising. However to be heard and seen in the web ocean you need to be loud and obtrusive. Unfortunately there is only so much advertising a person can take. Resorting to ad blockers by consumers is a logical answer.
At the moment ad blockers are charged with theft by marketers, media and the advertising sector whose existence increasingly depends on the ad business model. Legal action by publishers has so far not blocked ad blockers. Some ad blockers however have been swayed to withdraw their software. The chances that ad blocking software will be forbidden are small. Even in the unlikely event that companies such as Eyeo or Apple will, for some reason, be straightened out in court for anti ad activities, ad blocking is here to stay.
And that is a good thing too. Time is the one thing you can never recover so why waste it on unwanted ads? In fact the ‘ad blocking is stealing’ argument can be reversed by claiming that the publishing and advertising industry is stealing precious time, bandwidth and power from consumers.
According to the media sector the informal agreement is that consumers get content for free as long as they endure ads: ads pay for free content. This is not entirely unreasonable as there is no such thing as a free lunch, in this case free content. But if the ad battle makes one thing clear it is that publishers think that the free content is worth a lot more than consumers actually perceive. This discrepancy will only deepen as cost cutting continues to affect the content creation process while focusing on selling ads will only turn more consumers away or to ad blocking.
The advertising and media sector seem to have miscalculated the ad abuse content consumers can take as indicated by growing ad block usage. By having the right and means to block consumers are sending an implicit but clear message to the advertisers, advertising agencies and media companies that they can no longer be treated as muppets.