Mark Sweney 

Ad-blocking and fraud pose big questions for online advertising

Threat of consumers taking to adblocking in huge numbers has become a preoccupation for publishers, ad agencies and advertisers
  
  

Is this the year when adblocking kills the £3bn UK digital display advertising market
Is this the year when adblocking kills the £3bn UK digital display advertising market Photograph: Katherine Anne Rose/The Observer

Is 2016 going to be the year when adblocking kills the £3bn UK digital display advertising market?

“Adblocking is the thing I have been asked most about by clients, tech companies and even regulators,” says Paul Lee, head of tech, media and telecoms research at Deloitte. “What is the risk for mobile especially? It does feel like a lot of money is at risk.”

The official view from pro-advertising industry bodies is that there is no indication in figures, the Interactive Advertising Bureau has seen no slowdown in digital display advertising growth in the UK, so there is no looming problem.

But behind closed doors talk of the potential threat of consumers taking to adblocking in huge numbers has become a preoccupation among publishers, ad agencies and advertisers alike.

Developments such as Apple’s move to allow iPhone and iPad owners to download apps to block ads, Mozilla’s release of a new adblocking app for Firefox, and the spectre of true in-app adblocking, have fuelled a sense of panic.

The Doomsday-esque scenario for next year from Adobe and PageFair, a Dublin-based start-up that helps companies and advertisers to recoup revenue lost to adblocking, is that the amount of revenue that publishers lose due to it will double next year to $41.4bn globally.

The firms estimate there were 15 million desktop adblock users in the UK at the end of last year, and that this will grow to about 21 million by the end of 2016.

Deloitte’s Lee insists, however, that the industry needs to sort fact from fiction and that 2016 will not be an ad-pocalypse for publishers.

Looking at mobile, the pre-eminent means of non-work consumption of media, the ad market is worth about $70bn globally. He estimates the real revenue risk is likely to be just $100m of that, maybe less. Why?

First, Lee says Google’s Android doesn’t have the “natural native support” for adblocking like that introduced by Apple, and Android runs on 80% of the 2.5bn tablets and smartphones out there. Then users have to actively download a blocker, which won’t work when they use apps, which is up to 90% of usage. As for in-app adblockers, well, there is a view that Brussels is likely to have an issue over their legality relating to net neutralilty principles.

“The shadow appears very big but the reality is it is tiny,” says Lee.

There will also be increased scrutiny of the previously unquestioned efficacy of digital advertising, which mostly means Google and Facebook.

Look out for media industry doyens such as WPP’s Sir Martin Sorrell increasing pressure for answers about the impact of advertisers being charged for views by “bots”, computer programs that mimic the behaviour of internet users, and issues such as how to measure whether people are actually watching video ads.

Enders Analysis’ McCabe believes there will be a positive benefit for trusted digital brands, a “flight to quality” by advertisers which could benefit those currently further down the digital advertising food chain than the big two Silicon Valley giants.

Oh, and expect the usual stratospheric figures for ad spend growth on mobile, and in video.

 

Leave a Comment

Required fields are marked *

*

*