"Data-Driven Thinking" is written by members of the media community and contains fresh ideas on the digital revolution in media.
Today’s column is written by Ben Barokas, co-founder and CEO at Sourcepoint.
Following Facebook’s announcement last month, ad-blocking software may be rendered ineffective on the social network. With its decision to bypass blocking technology on its desktop website, ads will be served to all users, regardless of whether they have opted to block ads via software.
But while Facebook’s move in favor of ad reinsertion — the delivery of ads even in the presence of ad blocker — has been met with approval and dubbed a “spot-on” choice by Interactive Advertising Bureau (IAB) President Randall Rothenberg, it may leave some companies in a fix. Like, for example, GroupM.
Two months ago, GroupM laid out its position on ad blocking and ad reinsertion but it had the opposite message. GroupM’s view is that ad reinsertion is the “least consumer-friendly option” and the organization announced it would no longer pay for reinserted ads.
Both statements follow a sharp rise in ad block usage, with the latest IAB US report finding more than a quarter of internet users stateside now deploy the software on desktop. As a result, the cost for digital publishers that rely on advertising revenue is spiraling, and by 2020 global content producers are expected to have lost $27 billion to blockers.
GroupM’s decision to steer its clients away from purchasing ad impressions delivered to ad block users now potentially limits its trading options as Facebook commits to ad reinsertion. When we consider the significant reach of Facebook with its 1.7 billion active users and its growing significance to advertisers, the consequences for GroupM could be severe if it sticks to its guns. So, the big question is: Will the organization stand on principle or relax the rules?
GroupM’s convictions are clearly about to be tested. If we consider that the decision to forego purchase of reinserted ad impressions will now deny its clients the ability to reach a significantly sized audience across the Facebook platform, a rethink is a strong possibility. While GroupM has previously demonstrated a strong resolve to potentially controversial positions – as evidenced by its decision to commit to 100% viewability – it remains to be seen whether the allure of Facebook’s significant reach will be enough to cause a rethink.
It is commendable that both Facebook and GroupM have formed opinions and are taking action on this issue. But both Facebook and GroupM are pursuing fairly blunt, singularly focused approaches. While Facebook has provided controls for helping to manage advertising preferences, users are still left with just one choice – advertising – as a means of “paying” for its services.
Facebook and GroupM have made bold leaps in advancing the ad-blocking conversation, and while we may not be at the final destination yet, the move has brought the critical issue of ad blocking back to the forefront. We are still in the very early innings as we work to ensure a sustainable digital ecosystem, and while we cannot firmly predict what happens next, these actions are certainly the first of many to come as big players in digital publishing aim to ensure continued relevancy and viability.