by Giles Hirst, Marketing & Communication Manager at ExoClick
What are ad blockers?
As its name suggests, an ad blocker simply hides all types of advertising on websites so that users of ad blockers will see a blank space where an ad would have been served. Ad blockers are installed as browser extensions. All major browsers have ad blockers available and with a few exceptions, these extensions are not developed by the browsers themselves.
How do they work?
Ad blockers are using open lists of domains (maintained by a community) known to display advertising and they block any requests from the browser to these domains. So for example, when a browser makes a request to an ad server, the ad blocker will catch this request and block the domain of the ad server.
How does this affect publisher revenues?
Ad blockers have become an issue of increasing concern for the online advertising industry. As of June 2015 there were 198 million desktop ad block users, with global growth of 41% year on year (Q2 2014 – Q2 2015.) Latest research shows that there is a possible increase in the number of ad blocker users on mobile devices too. It is estimated that the financial impact of ad block usage cost publishers $22 billion in lost revenues in 2015.
What can publishers do?
The first port of call is to talk to an expert, ad networks such as ExoClick have solutions already in place to help publishers combat lost revenues from ad blockers as well as actually increasing revenues from ad block users. But what other ways are publishers trying out in order to combat ad blocking?
1) Do Nothing – A common approach from publishers is to do nothing and wait and see. Additionally, many publishers think that ads are simply hidden by ad blockers and that impressions are still counted, but the ad servers are not called to serve the ad because they are blocked, so no impressions are counted. This solution delivers zero revenue and is not sustainable in the long term.
2) Take Legal Action – Lawsuits from media agencies (RTL, ProSiebenSat1, Zeit Online, Handelsblatt and Axel Springer) against Adblock Plus have all been unsuccessful. This initiative would require coordinated action from global entities, such as the Interactive Advertising Bureau. Until now, there hasn’t been much work done against ad block companies using this type of action. This solution is costly in legal fees and it can take years to implement new legislation.
3) Kindly Ask – This is probably one of the most common actions publishers have taken when they detect a user is using an ad blocker. A pop up or banner message appears asking them to turn off their ad blocker to view the content. Unfortunately, studies show that displaying a message to users and asking them to disable their ad blocker is not very effective. The percentage of users who will actually do this is extremely low, less than 1%.
4) Deny Access – This solution is a strong enforcement towards users of ad blockers because it denies them from seeing the content on a publisher’s site until they switch off their ad blocker. However, its effectiveness may vary depending on the reputation of the website and the uniqueness of its content. If a site prohibits access to ad blocker visitors, it is very likely that these users will go to another website with the same or similar style of content, making this highly risky.
5) Serve Alternative Ads – Showing alternative ad content refers to the display of affiliate ads or ads from a few advertisers with whom there is a direct agreement, so when an ad blocker user is detected, these ads will show instead. This solution consists of hosting the ad creatives in the same domain as the website, so ad blockers consider the ads to be part of the website. This solution limits the amount of ads that can be shown as publishers have to manually implement the ads on their site. In the case of affiliate ads, publishers get each of the ad creatives from an affiliate program and then upload them onto their website, which is time consuming for the publisher.
Publishers who opt for this solution should be careful about the implementation. Firstly, the name of the ad creatives and the hosting directory are important elements to be concerned about, as there is still a risk that ad blockers will block them. In the short history of ad blockers we have seen examples of publishers having essential files blocked on their sites, because they were hosted in the same directory as the ad creatives.
Secondly, considering that only a few large publishers will be able to sign direct agreements with advertisers on a flat fee model, few affiliates ads are able to provide a significant amount of revenue because affiliate ads pay based on conversions only. Additionally, it is common knowledge that revenue comes from well targeted advertising therefore it is very unlikely then that small/medium sized websites will have the infrastructure to identify and distribute personalized ads.
6) Change Domains – Because ad blockers are based on domain blacklists, it is possible to bypass them by constantly changing the domain names of the ads. This practice has been used by single publishers and also by ad networks. This solution is probably the most aggressive against ad blockers and is also the most profitable one. The risk however is much higher than any of the previous solutions mentioned. Ad blockers will soon identify the new domains as the source of ads and begin to start blocking them.
7) Serve Unique Ad Impressions – This solution consists of bypassing ad blockers by serving each ad creative from a unique url outside of the publisher’s website. This technology ensures that the urls cannot be identified and therefore cannot be added to the ad blocker block lists. The implementation of this solution is easier than the previous solution mentioned, as the ads are not distributed from the publisher’s side. Moreover, the uniqueness of the url reduces the need to maintain the implementation, because it is much more difficult for the ad blocker to identify it. This solution is cost free for publishers and it immediately delivers all of the lost revenues from ad blocker users.
Up until now ad blockers haven’t started blocking website elements blindly. So this solution can deliver positive results in the short term and possibly the long term too.
8) Get Whitelisted – Based on Adblock Plus’ Acceptable Ads Manifesto, publishers can now whitelist their web pages in order to show ads if they comply with Adblock Plus’ criteria. These criteria are very strict, not allowing: animated ads, hover effects, autoplay-sound, video ads, expanding ads, interstitial page ads, rich media ads, pre-roll video ads, etc.
To be placed on Adblock Plus’ whitelist is usually free for smaller websites, as long as the above criteria are met. However, even if a website is whitelisted, publishers cannot use third party ads from ad networks, therefore the revenue stream is limited considering the restrictions in ad formats and collaboration opportunities.
It is is also possible for advertising agencies and ad networks to get whitelisted, but not for free. In 2015 Adblock Plus confirmed paid deals between Google, Microsoft, Amazon and ad-serving company Taboola. Due to the volumes and the value of the ads distributed by these companies, it allows them to pay to get whitelisted.
However, this solution is not sustainable in the long term for several reasons:
- Only Adblock Plus is making paid agreements to allow ads. There are many other ad blockers that do not do this, so it is impossible to get whitelisted on all of the ad blockers.
- In 2016 Adblock Plus signed another paid agreement with the Criteo ad network, which specializes in retargeting. Many users claim that retargeted ads are an invasion of their privacy and security. Privacy and security are considered to be some of the key reasons users are installing ad blockers. When users realize that they are being retargeted again it will drive them to install another ad blocker which will not allow the whitelisted ads.
- Blocking all the whitelisted ads from companies who have paid or not is as easy as installing an ad blocker. Every user can simply deselect the “Allow some non-intrusive advertising” tick-box in the Adblock Plus settings and the user will not see the ads, wasting the payment the company has made.
Ad blocking is a problem that impacts the whole advertising industry and the foundations of the Internet for free content distribution. Its negative impact on advertising revenue has raised awareness and it needs to be addressed in the short and long term.
Unfortunately, there is no silver bullet solution because each different solution has its own variable costs and risks. Therefore, publishers will have to choose between all of the available solutions with different levels of enforcement and effectiveness.
ExoClick is an expert in the digital advertising field and is here to support and work with publishers whichever solution they decide to implement, in order to help them optimise their ad spots and help them provide a better experience for their users.