Round Up: Ad Blocking is the New Pink
The launch of iOS 9 last week has brought advertising to the forefront again, revealing the many problems in the industry.
Rather than being a new problem, ad blocking has simply revealed that the advertising industry is unhealthy and dysfunctional.
As Bloomberg tells us, this is an industry where a website can buy visitors from disreputable sources and then show those fake visitors adverts from an ad network that turns a blind eye to the fraud.
Digital’s return on investment was around 2 to 1, a $2 increase in revenue for every $1 of ad spending, compared with at least 6 to 1 for TV. The most startling finding: Only 20 percent of the campaign’s “ad impressions”—ads that appear on a computer or smartphone screen—were even seen by actual people. – The Fake Traffic Schemes That Are Rotting the Internet (Bloomberg Business)
It’s an industry where everyone from the advertisers to the ad networks to the tech companies to the websites shrug off the blame for problems like malvertising, a poor user experience, and fraud.
The interesting thing about the infrastructure of buck-passing is that any acceptance of responsibility is seen as apostasy. If we try to change our role in making a broken system, the folks next to us will lash out for pointing out the shortcomings. – How we pass the buck (The Message)
In fact, some are so eager to pass the buck that they choose to focus their anger on external issues (strangely, while also pointing to the problems the industry needs to solve):
As abetted by for-profit technology companies, ad blocking is robbery, plain and simple — an extortionist scheme that exploits consumer disaffection and risks distorting the economics of democratic capitalism. When implemented by consumers, ad blocking is a crucial wakeup call to brands and all that serve them about their abuse of consumers' good will. – Ad Blocking: The Unnecessary Internet Apocalypse (Advertising Age)
That piece goes on to argue that everyone in the ad industry needs to take responsibility for the problems (this is almost ironic given the earlier ranting). According to that article, websites need to start refusing adverts that cause a shitty user experience, ad networks need to curb the most abusive practices, and everyone needs to stop using so damn many tracking scripts which are ruining things for everyone.
All those tracking scripts are used because well, money, but also because online advertising is inherently flawed, as Cory Doctorow points out:
At root is an intrinsically toxic relationship between the three parties to the advertising ecosystem: advertisers, publishers and readers. Advertisers buy publishers’ inventory to sell things to readers, but publishers sell inventory to advertisers because they want money, not because they want to help sell products. Readers want to read what the publishers are publishing. A tiny fraction of readers want to buy what the advertisers are selling, and this microscopic minority subsidises the whole operation. – How to save online advertising (The Guardian)
Sadly, it’s not nearly as easy to fix as one might hope; the industry is so convoluted that there is no single point you can fix.
Worse, adtech is also a vector for malware and fraud. That’s because the supply chain for adtech could include any of the following things you’ve probably never heard of, and which together turn adtech into a four-dimensional shell game. – A Way to Peace in the Adblock War (ProjectVRM)
This industry is so complex and broken that the only way to fix it could be to build a completely different parallel structure, perhaps one based on the business model of The Deck.
This is a boutique ad network that breaks most of the standard practices for the advertising industry.
The Deck runs counter to many ad tech companies in its willingness to sacrifice scale in the name of quality. It has only 42 publishing partners, including Daring Fireball and design blog Swissmiss and mobile apps Twitterific and Instapaper. It only offers 33 ad slots each month, which it sells for $8,900 each. Publishers have to work exclusively with The Deck, to ensure they can’t “fill their pages with punch-the-monkey ads,” as Coudal put it. The Deck, whose ads are sold at a $3 to $4 CPM, served 92 million impressions in June. – Old-school ad network The Deck on ad blocking: 'We’re paying for everyone else’s sins' (Digiday)
While the Deck is a great idea, the single ad per page concept just won’t work for most sites.
Nevertheless, more advertisers need to embrace the idea of only placing adverts that are not user-hostile, because that is going to be the only way to get users to stop blocking adverts.