What Advertisers Need to Know
Ad blocking is a massive problem and opportunity for advertisers across North America and globally. The backlash against online advertising has reached a tipping point with ad blocking spanning 15-38% across the US population and larger globally, and estimates that ad blockers are currently used on over one billion devices.
In 2019 the United States population was estimated to be 328 million people. So even at the lowest ad block rate mentioned above of 22%, that represents 72 million people that do not see traditional digital advertising. And that in turn means advertisers are unable to reach a large segment of their target audience.
This challenge gets worse for advertisers who target specific audience demographics, for example, tech-savvy, well educated millennials where ad blocking can exceed 40%.
Business Development Must Shift Buying Behavior
Up until now, traditional approaches to address ad blocking have not worked, whether you attempt to use whitelisting or worse, tools that try to circumvent and force ads onto ad blockers.
Further, the main method for reaching digital audiences at scale today is through programmatic advertising. The most widely used programmatic advertising uses behavioral targeting of individuals rather than contextual targeting of websites or content. In May 2019, Techcrunch quoted an earlier study by IHS Markit, suggesting that as much as 86% of programmatic advertising in Europe was using behavioral data. While even a quarter (24%) of non-programmatic advertising was found to be using behavioral data.
However behavioral targeting has been at the heart of the growth in ad blocking. Consumers don’t like disruptive advertising that interferes with their on-line experiences, and are often irrelevant to them. Moreover, consumers guard their privacy and do not like to be tracked and targeted based on their online behavior. The fear that their personal information is not protected and being freely traded amongst hundreds of companies is real.
Tracking, targeting and capturing of personal data has resulted in such an outcry that regulators have stepped in. In Europe, GDPR was implemented in 2018 and here in the US, Congressional hearings on data privacy resulted in a new privacy bill, the CONSENT Act being introduced. Most recently this year, California implemented The California Consumer Privacy Act, establishing a new, groundbreaking consumer privacy rights.
It’s only a matter of time before behavioral targeting will no longer be the prevailing method for reaching valuable audiences.
So what should advertiser business development teams be focusing on? Here’s what we are seeing across the industry.
- A Return To Contextual Advertising: Contextual advertising is on the rise and for good reason. It gives advertisers the opportunity to place high quality ads on websites that are relevant to the sites’ mission, often enhanced by specific page content driven by keyword targeting. It’s also where their target audience will be. Another major factor is that, unlike behavioral advertising, contextual advertising does not require or use personal data and therefore complies with a myriad of regulations enacted. In an article on streetfightmag called “A Return to Contextual Advertising,” the writer emphasized that “Transitioning to a content-based advertising strategy will minimize consumer complaints and, for advertisers, may have the additional benefit of mitigating the impact of ad blockers and “do not track” technology”.
- The Rise In Direct Buying: Last year it was reported on The Drum that many of the top advertisers were moving significant ad spend from programmatic to direct digital placements. One reason for this significant shift is to provide advertisers greater control and transparency over where their ads are placed
The desire by advertisers to reach the consumer in a privacy compliant manner, and protect their brand is driving an increase in major brands using contextual advertising with campaign driven direct buys.
Connecting Premium Brands With Coveted, Unreachable Audiences
While the above changes in buying behavior are important, they don’t address the elephant in the room; ad blocking. The resolution of the escalating ad block crisis requires a change in thinking and action, recognizing that consumers now have the power to decide what is acceptable and what practices will not be tolerated. Permission-based advertising is the most powerful way to provide consumers with the power to decide what is acceptable and also address the ad blocking issue.
Adtoniq provides high-performance digital advertising to ad block users built on permission. We give back control to consumers who use ad blockers, offering them choices to opt in to see ads or not and then making it frictionless to give permission, while respecting their privacy
It sounds simple, but we are seeing the amazing impact that doing right by consumers is having particularly in recovering the trust of ad block users and the dramatic, positive impact it has on their behavior. Working with major advertisers and publishers we are reaching ad block users they aren’t able to reach and achieving results that far exceed those seen from consumers that don’t use ad blockers. With opt-in rates ranging up 70% depending on audience demographics, we are delivering a 3 to 10 X click through rate (CTR) than respective non ad block audiences, nearly half of all ad impressions and significantly increased conversions.
The bottom line is that treating ad block consumers with respect, meeting them in their space and on their terms is the perfect way, and perhaps the only way forward for all concerned. Permission-based advertising is the key to engaging with this substantial, brand new audience that has been completely unavailable, until now.