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March 6, 2010
 

Adblocking is Missing the Point

 

There’s a conversation going on right now arguing the merits and demerits of adblocking.  Ars Technica needs them turned off in order to generate revenue.  Readers like Brian Carper finds the need to look at advertising as ethically repugnant.  However, I think that they are both missing the point.  The fundamental problem is that the advertising model is broken.  There is no mechanism for properly trading attention for money.

Ars is basically saying: we know ads suck.  But we want to get paid, so please stop blocking them (even if we know you’re never going to buy from the advertisers).

On the other hand, Carper is saying: don’t play me for a sucker.  If I want to block the ads, I’ll block them - I don’t care if you take your site away.  If I find it valuable enough, then I’ll pay for the content.

But here’s the problem with the discussion: advertising is broken anyway!  It’s a mechanism that provides no value to anybody, be it Ars, the reader or the advertisers.  What if Brian and everyone like him capitulated and turned off the ad blocker?  He’d just turn on the same ad-blocker that I use - the one between my eyes and my brain.  I never click on ads.  Ever.  Ever.  Ever.

The intermediate result is that Ars would get paid - but not for long.  The end result is that advertisers will find ads not worth the cost and either take them away or ask for a reduced price…driving Ars to look for more revenue streams (read: advertisers).  Can you say Computerworld?

What is needed is a different system, one that provides value to all three entities.

  • Provide Ars with revenue for their articles.
  • Sell product for the advertisers.
  • Provide readers with goods and services that they need.

I don’t know what that system might be, but maybe Daring Fireball and The Deck is a good place to start looking.  Instead of using a shotgun approach, they choose to be more selective.  I don’t know if this would work for Ars, but I know two things:

  1. Via Daring Fireball - the Mac Sale is offering a $500 bundle for $50.  (And no, I’m not affiliated with Mac Sale in any way.)
  2. I don’t adblock but I couldn’t name an Ars sponsor off the top of my head if you paid me.

 

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Posted by Anthony 

Comments (3)

Mar 06, 2010
cheald said...
You're assuming that ads only make money for a publisher when they're clicked on. They aren't.

Ads are served in a CPM (impressions), CPC (clicks), or hybrid payment model. Sometimes you'll buy 100 clicks. Sometimes you'll buy 100,000 impressions. When I have adblock off, I am served an ad impression, and the publisher gets paid a tiny fraction of a cent for that impression. Scale that by a million pageviews a day and you have some impressive revenue throughput.

Just because you don't click on ads doesn't mean that nobody else does. I run a fairly high-traffic ad-supported site, and I get about a 3% CTR, and even if you don't click, though, I get paid for the impression.

This obviously does work. The online impression-based advertising model is extremely strong, and really isn't going away any time soon. Impressions are worth a lot to advertisers. Even if you don't take action on an ad, you're left with the impression of their product. For a blatant case of this, see Evony. I'll suspect they didn't get a ton of clickthroughs, but -everyone- knows who Evony is. Their ad campaign embedded their product in the public consciousness.

Ad value is not broken down into "impression converted into a sale" and "impression did not convert into a sale". There are a lot of shades of grey in between. Why do you think people buy billboards, or put up posters on telephone poles, or purchase television ad spots? Those aren't immediately actionable - I'm not going to click on my TV to purchase that new BMW I just saw an ad for - but I'm left with a (hopefully positive) impression of BMW's product, and will remember BMW's name next time I'm in the market for a car. The business of advertising is far more subtle, insidious, and lucrative than you give it credit for.

Mar 06, 2010
OneMiles said...
There is no inherent "value" in adds to begin with. Adds create the wrong motivators to produce content, just look around at all the shit on the net. Whatever the ideal system ends up being, please don't let it be one dominated by adds.

Instead, create a system where each http request has the potential to capture some sort of micro payment, payments cant be collected until after both parties agree (using certificates, the secure kind) to a fee structure. Then you have direct buyer to producer transaction, the middle man (yes, that middle man still exists, his name is Goolge, Apple, MSFT) truly dies and every "individual" wins!

Mar 07, 2010
Anthony said...
Hi Chris,

My response got a little long, so I wrote up another post instead. Thanks for the feedback!

http://www.inforift.com/looking-for-a-better-way

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