At SXSW this year I was happy to see ad blocking on the radar. One great talk I attended, hosted by James Schad, Innovation Director at Vizeum UK, covered the landscape including two recent developments from Europe. First, British Telecom Three partnered with Israeli startup Shine to block mobile ads at the network level – ostensibly to improve load times, but more likely for one of two reasons I’ll mention below. Second, the EU has finalized the text of their General Data Protection Regulation, including a clause requiring marketers to receive “unambiguous consent” from consumers in order to use their data. The first is a warning shot to ads: be less obtrusive. The second is a warning to all marketing and big-data businesses active in Europe: the hose is about to turn off.
A couple of key points:
- Europe is a bit ahead in the uptake of ad blocking: 22% of the UK and 37% of Greece is way ahead of say, 12% of Texas.
- 47% of 18-24 year olds are blocking ads now. No telling how ads will fare when Gen Z comes of age.
- Ad blockers block good ads too: James noted that UK Government ads and ads by charities are also blocked.
- Ad blocking in the US is higher in blue states and with youth who tend to vote Democrat. Considering the $1b in political ad spend, that could bode well for Republicans.
- Besides better load times, there are two reasons that could be motivating Three to block ads across their network. One is saving bandwidth: ads take up a huge proportion of most page loads and Three has to pay to deliver that to their users. The second is a bigger theoretical reach, and assumes a bit of bad acting, but it’s not without precedent: ransom. By gating all ads, they open up the possibility of un-gating some ads, for a fee. For precedent, see AdBlock Plus, who currently allows entities to whitelist “Acceptable Ads”, for a fee totaling 30% of additional revenue generated by the whitelisted ads.
- There’s a deep need for a ClassPass or Spotify style subscription service where readers can subscribe once and access all the major and minor content providers.
- Brand Marketers need to find unblockable means of spreading digital content. I’m biased here because I’ve seen the power and cost-effectiveness of Word-of-Mouth marketing. Native content is a partial solution, but quality and authenticity needs to improve because right now you can hear the brand talking behind the text. People will never block their friends. Getting real people to spread real messages they believe in will continue to be the one unstoppable marketing strategy.