Posted on September 22, 2016
Last week, Adblock Plus announced it would begin selling ads. That is not a misprint. The company literally named ‘adblock’ ( as in stop or prevent advertisements) and ‘plus’ (to tell users that they do that very well) is doing the exact opposite of the thing it promises to do.
For those unfamiliar, Adblock Plus was one of, if not the, leading adblocker. As a plugin or browser extension, users could install it to prevent advertisements from appearing in the websites they visited. The program is generally credited with popularizing online adblocking, which has had a major impact on how information travels on the Internet. Selling ads after selling the ability to block them is a complete 180. In fact, it looks like the company built on preventing ads from being served never really understood how users and advertisers interact with the ads they do see in the first place.
Predictably, initial reaction to the announcement was harsh. This could very well be the beginning of the end for the company. Technically, Adblock Plus is expanding its Acceptable Ads initiative with ‘a fully functional ad-tech platform that will make whitelisting faster and easier’ that promises to ‘turn the model on its head.’ According to Adblock Plus, the new program offers advertisers auction-based or real-time bidding (RTB), just like Google or Facebook. The difference is that all of the ads are, theoretically, vetted by Adblock Plus’ users. This is supposed to act as a kind of guarantee that they will not detract from any website’s browsing experience. If you ask the company, Adblock Plus is offering an alternative to RTB — instead of targeting options offered by every other RTB platform, user experience determines which ads are ultimately served.
Basically, Adblock Plus is hoping to enter the supply side of the digital advertising market. The new service will allow publishers and bloggers to buy ads vetted by Adblock Plus or users of Acceptable Ads because these ads are not disruptive to the browsing experience. Yes that was supposed to sound weird. There are lots of problems with this strategy. First is the problem of perception: Adblock Plus, a celebrated Adblocker is selling advertisements to online publishers. IAB UK CEO Guy Phillapson alluded to some of the other strategic issues in a statement, comparing the company’s new direction to a protection racket:
‘We see the cynical move from Adblock Plus as a new string in their racket. Now they’re saying to publishers we took away some of your customers who didn’t want ads, and now we are selling them back to you on commission. The fact is, in the UK ad blocking has stalled. It’s been stuck at 21% throughout 2016 because the premium publishers who own great content, and provide a good ad experience, hold all the cards. More and more of them are offering ad blocking consumers a clear choice: turn off your ad blocking software or no access to our content. And their strategy is working, with 25% to 40% turning off their blockers. So with their original business model running out of steam, Adblock Plus have gone full circle to get into the ad sales business.’
Adblock Plus’s decision, and the initial reaction to it, prove the company misunderstood its old customer base and the publishers or advertisers it is hoping to turn into customers. First, Adblock assumed its current users, people who downloaded something that, again, is named Adblock Plus, want to filter ads instead of blocking them. They also misjudged how appealing RTB is in its current form for advertisers, and like Phillapson said, that users are actually willing to put up with highly targeted ads from the content suppliers they enjoy. Most importantly, as a brand or someone paying for an ad, why switch to a system with less control when there is no substantial opposition to the current RTB model?
Besides Adblock Plus, there are other similar adblocking programs that provide practically ad-free browsing experiences. Many of them have capitalized on the negative reaction to Adblock Plus’s announcement by doubling down on their stated promise of actually blocking ads. Most of these programs use a process similar to the ‘whitelisting’ service Adblock is offering, allowing users to view ads from the sites they deem safe. This gives users the sense of control Adblock Plus is convinced it just invented.
Adblock Plus’ new take on whitelisting ignores the dynamic its previous version helped establish between users, publishers, ads, and advertisers. In the original model, training users to whitelist sites instead of individual ad units placed credit or blame for ads appearing with the publishers who accept revenue from them. Once a publisher or website was whitelisted, they remained whitelisted until the Adblock Plus user manually reversed their decision. Giving the ‘pass’ to publishers, instead of individual ads, made a ton of sense: ads change much more frequently on a random site than on a site someone frequently visits, and publishers generally adhere to the same standards when deciding which ads they’ll allow on their site.
This system was successful because it was simple. It also let advertisers actually advertise, which is by nature intrusive. Crucially, by placing agency on the sites, ads were presented as a necessary evil to support the content that users enjoyed. The new model abandons that simplicity by asking users to vote on the ads themselves and it changes the criteria for whitelisting. No advertiser in their right mind would choose an ad unit that is sanctioned for its inability to draw attention when alternatives advertising models exist. Adblock Plus seems to have forgotten that publishers need ads, and ads need to be somewhat disruptive in order to be effective, which is why there was a desire to block them in the first place. Also the RTB marketplace Adblock Plus envisions would require a staggering amount of sanctioned ads in order to provide enough variety to publishers to compensate for the (likely) reduced appeal among actual advertisers. Adblock Plus probably doesn’t have the user base necessary to vett that many ad units, especially after losing so many customers in the wake of its announcement. In fact, RTB, or the auction model Adblock Plus is attempting to adopt, is dependant on the relationship between site owners or publishers and users. Before, the company played a part in emphasizing this relationship, but now it’s neglecting it at its own peril.
Real time bidding is practically the only way to advertise on social media and search engines. First popularized by Google, versions of this bidding can be found on practically every other search engine, the largest social networks –like Facebook, Twitter, and LinkedIn –as well as leading content marketing services like OutBrain and Taboola. These platforms employ continuous streams of content, and the auction model was the only way to account for how they disseminate information in real-time based. The auction system accounts for the practically infinite variations of a given user’s news feed or search results. Instead of paying for a predetermined placement, advertisers bid to appear in the most relevant possible placements as they become available. The innumerable choices in social or search platforms that determine where ads could be shown mean users are subject to an incalculable number of ad units. This only works if the users trust the website or publishers to choose ‘acceptable’ ad units. Going through each ad individually would take forever. Even in content marketing, random units appearing in a given site’s ad spaces are subject to browsing data that essentially creates the same degree of randomness as social media. It is more practical to establish trust between sites and the people who visit them, instead of users and ads. One could argue any RTB system needs to be based on demographics instead of user experience, because targeting needs to be grounded in something that correlates to the person actually seeing the ad to account for the endless contexts in which it can appear.
Demographic information was key to popularizing RTB because advertisers love getting this info. They gain access to unprecedented amounts of users in a single ad buy, and a targeting system that is infinitely more specific than any other format. Social and search advertising use demographic categories based on static information (as well as in-platform decisions, but that’s for another column), like registration data, as static endpoints in a given user’s ever-evolving data set. Essentially, this allows advertisers to bid on who sees an ad, unlike older models where they paid for placement. RTB took out a lot of the guesswork in terms of ‘is the type of person I want to see my ad guaranteed to see my ad?’ Though users may complain about advertisers using their private information to build RTB campaigns, the information advertisers actually get to work with cannot identify individual users. There are certainly issues with privacy and RTB, though they are not close to significant enough to overthrow the system.
Right now, it looks like although Adblock Plus understood the trends in online advertising, they failed to contextualize their role in a changing digital landscape. People care generally if ads are on their screen, but the vast majority do not worry about how they were targeted. Though users are growing more tolerant of ads, and perhaps concerned over how they are delivered, high quality content keeps them coming back to sites using granular tracking options in their RTB units. People understand that websites need to pay the bills and, for the most part, they are willing to let them serve targeted ads in exchange for the services they provide. Up until recently, users who were unwilling to make that trade relied on Adblock Plus. Since, until last week, its entire business was blocking ads, the company is still considered toxic by many groups it now hopes to count as customers. Any chance of building up the user base quickly is slim, having lost a considerable portion of existing customers, and they do not seem to have the quality content needed to attract new ones. The promise of an ‘acceptable’ advertising experience is nice, but it’s a job for a plugin, not a content publisher or even an ad broker, which is what Adblock Plus is trying to morph into. Perhaps slowly rolling out a different plugin, branded with something connected to its acceptable ads initiative, working to accelerate the whitelisting process, maybe by gathering information about which ads users find acceptable to later sell to publishers, while still maintaining their initial service or line of business, would be a better strategy. Anything to avoid having to say ‘Hi we are called Adblock Plus, though we will no longer be blocking ads, as much as asking sites to pay us to show ads to users they attracted without any real help from us.’ Adblock Plus already alienated online publishers. Trying to quickly pivot and turn those people into customers may have cost them the ones they did have for their original service. Unless content providers, advertisers, and users radically change how they interact with ads online, Adblock Plus’ may end up using their new RTB platform to sell their office space instead of actual ad units.