More and more consumers are downloading ad blockers. And new tools and services are coming this year (such as Apple allowing ad blocking on iPhones, and a new mobile carrier-backed ad blocker) which will make it even easier for consumers to choose to block ads.
That’s clearly a huge problem for the advertising and media industry. It takes money out of the system (and internet companies like Google are paying huge fees to the ad blockers to get their ads whitelisted.) If ad blocking became mainstream, publishers would struggle to fund their content, and publishers and ad buying agencies might have to look at a new model when it comes to digital, and for advertisers themselves, the growth of ad blocking says there’s clearly a problem with the advertising they’re creating online if people find it so annoying they opt to turn it off.
We spoke to three executives from each side of the equation at the Cannes Lions advertising festival this week. We asked one simple question: Are you concerned about the rise of ad blocking?
The ad agency boss: WPP CEO Sir Martin Sorrell
If you look at the numbers with ad blocking, Apple [mobile browser] Safari is what? 25%? Most people use apps. And you have to insert a third party piece of software to block. Most people would come down to a [more significant] figure if it was effective.
Then there’s the guy from Google who said ‘I am going to [raise] $US10 million [in investment] in blocking the blockers’ [launching a company called Sourcepoint.] And the other thing is: will people pay for content? If people do block ads, and it is effective, all it does is raise the price of content.
The money has to come from either subscriptions, or from ads. It always reminds me of … the Communacopia Goldman Sachs conference 10 years ago. One year it was all about ads, another year it was all about subscriptions, then the third year it was a bit of both.
The honest answer is: you don’t know, but the problem was created by the fact that people gave stuff away for free, so you just become used to getting it for free, and to get them back out of that is going to be very difficult.
[For WPP] it means that we have to develop different approaches in our business. Why we [formed a partnership with Snapchat and the Daily Mail to launch an ad agency] is because you will differentiate from other people.
It has been proven at Cannes the last three to four years [WPP has won the agency network of the year award] and hopefully it will be proven again. We do very well in terms of creative product and output.
The publisher: Daily Mail US CEO Jon Steinberg
I think it will be an arms race and just sorted that way. Look at the Sourcepoint announcement just last week.
We’re also on Apple News and Snapchat and will participate in more hosted scenarios that make this less an issue.
Finally, content advertising is a big part of our future. Look what we are doing in Daily Mail with branded articles and the original branded videos Elite Daily is doing for brands like T-Mobile and Strayer. People don’t want to block content.
The marketer: Mondelez CMO Dana Anderson
If you look into what happened with TiVO and DVRs [which allow consumers to record shows and fast-forward the ads,] you would have thought that would be the death of television advertising. Well they could also always get up and go out of the room, they can flip channel, they can ignore it. I think you can avoid ads if you want to.
I would say [as a brand] I’ve got to stand for something that’s bigger, and give you the experience you want — maybe something you’ll talk about, like our Oreo eclipse campaign [where Oreo paid for a digital billboard ad which mirrored the actual solar eclipse in the UK] and the things we do with Honey Maid in the US [celebrating the non-traditional “American Modern Family”] — that really started a dialog about culture.
I realise that’s hard to do, and that’s really the tip of the iceberg. But I think creativity is the answer, I really do. To be there in a way that someone wants you to be there, because anyone can avoid you.
James Hurman in his book “Creativity Matters” makes the case that great creative works five times harder. And Aegis looked at 2,500 campaigns in a study, and the two things that are the biggest predictor of ROI [return on investment] are the size of brands and creativity.
I think you have to try at every level because it’s a whole, and why make a great TV ad and a boring outdoor ad? It has to have that level. When you have a great idea, it goes and goes. Is it hard to do? Yeah. But the payoff for that effort is so worth it, and the numbers prove it again and again. We have a saying at Mondelez: “If you can’t share, we don’t care” — it makes our challenge more invigorated. You have to be engaging.
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