Tuesday, October 27, 2015

Mobile ad blocking: A threat to the industry's future?

Lincoln Rinehart

The onslaught of mobile device users in the past decade has brought forth a new generation of advertising.  However, the infrastructure marketers have worked so hard to build is tumbling, and will leave room for new innovations in the marketing industry.

Ad blocking is the new trend among mobile device users.  It prevents certain types of ads from being displayed on user's screens.  Recently Apple released the iPhone 6s, which contains ad-blocking software.  This new software could easily put a damper on advertising revenue in the next couple years, but the software still allows for some mobile exploitation.  Facebook, Snapchat, LinkedIn and Flipboard all display native ads as sponsored content within their mobile apps, and this advertising content is immune to ad-blocking software.  An example of mobile Facebook ads can be seen below.

Mobile Facebook ads
(Source:  thenextweb.com)

So the reality of ad blocking is that it may sound like a great idea from a consumer standpoint, and it may lead to temporary revenue loss for mobile ad agencies and companies alike, but in the end it is just a gentle push towards the next evolution of advertising.  One company that produces mobile advertising is Mobile Majority.    

Companies like Mobile Majority and in-house marketers, will collectively elevate the advertising industry to a new platform, one that entirely disregards the usefulness of ad blocking.  For instance, the Ad Age article points out that a similar thing happened when TiVo and DVRs allowed viewers to bypass commercials.  However, the technology further evolved to streaming services like Netflix, Hulu, etc., and, subsequently, more opportunities for marketers.

There will be temporary outcomes of ad blockers on the mobile advertising industry, on companies and on the way mobile users consumer content.  The mobile advertising industry overall will begin to shift towards native advertising.  Native advertising appears in social media apps, and is unaffected by ad-blocking software.  Until companies and agencies find another way to reach mobile audiences many of them will be emphasizing native advertising.  Companies will also begin to focus on earned media. Earned media is a marketing channel gained through pulling users in to view content, rather than pushing content out towards users.  Inbound marketing tactics that do not utilize strategically placed mobile apps will become the new trend.

Ad blockers will affect the way mobile users consumer advertisement content.  Users will become used to not seeing ads on several sites.  Even if mobile sites find a way to display advertising, these ads will eventually drop in sales because users will find them irrelevant.  As companies begin to use new marketing tactics to pull consumers in, less media will be directly purchased, and many websites will forfeit revenue.

Although some companies may lose advertising revenue, all is not lost.  As the Ad Age article pointed out, "Capitalism will prevail and the marketplace will sort itself out as new solutions are developed."        

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