While there may be no quick industry fix for ad-blocking, which threatens the main source of revenue and business for media and advertisers, the closing panel at the 4As Transformation conference took a stab at understanding the root cause of the issue and how adland should be responding.
Part of the problem is acknowledging that more than one facet of the industry is responsible for creating a bad experience for the user, according to Jeff Burkett, senior director of product strategy for The Washington Post. "We found that people were accidentally clicking on ads, and that was frustrating to them," he said. "The perspective from agencies at that time was that it was mostly the publishers' problem -- publishers were at fault for ad blocking. I can opine that that's absolutely false. What we're also seeing is that we were being forced by the agency, in order to get them to buy, to serve obtrusive formats that we as a publisher would prefer not to."
Now, he said, ad blocking is giving publishers like The Washington Post an excuse to say no because advertisers and buyers care about reaching those users.
"When you talk to the publisher, they say they have no choice," said Vegard Johnsen, product manager of sustainable advertising at Google. "The advertiser says, they shouldn't put so many ads on the page."
Is there a quick fix? No. But one of the key steps the entire industry needs to take is making better mobile content before users can more easily block mobile ads in two to three years, he said. For now, it's still more difficult to block ads on mobile devices. "[Users] are not happier about their [ad] experiences on mobile," he said. "They're less happy there. They just don't have the option yet. We have an opportunity to make sure there is no need for ad blockers on mobile."
There are about 200 million people throughout the world blocking ads on desktop browsers, said Jim Hirshfield, senior VP of sales and general manager of America for PageFair, a company that helps publishers serve lightweight ads when their original ads are blocked. In the U.S., about 16% of users are blocking ads on desktop, and more in countries such as Germany and Greece, he said. And about 2% of users are blocking ads on mobile devices.
"Mobile has been hyped up in the media, but the real problem is on desktop," Mr. Hirshfield said. "Publishers monetize better on desktop."
They also emphasize volume, which may be part of the problem, explained Ernie Cormier, chief product officer of AOL Platforms. "What's driving the kind of ad saturation and crappy experience is the fact that publishers are not making much money off advertising," he said. "They try to make it up with volume."
In response to the larger issue, AOL is experimenting with new high-production, interactive ad formats that are less obtrusive, Mr. Cormier said. "We need to improve the experience of targeting so advertisers pay more on a CPM basis than they do today."
This is only one approach of many around which the industry needs to rally, Mr. Cormier added. "No industry is necessarily good at coordinating multi-faceted programs across sub-ecosystems," he said, using the example of a campaign from the mid-90s that for years tried to educate the public on how pirating content affects the lives of those involved in the creation of the content. "If we don't do that, there's a serious crisis around idea of how we fund creative content," he said. While it's not a solution for the ad industry, it's still the kind of step that's necessary as part of a broader program.
"We're talking about making less money in the short-term?" asked moderator and Horizon Chief Digital Officer Donnie Williams.
"The market will tell us whether it's less or more," said Mr. Cormier.
A new way of thinking about effectiveness is another necessary step, the panelists agreed. Mobile, static display ads that are not rich media had longer retensions in the consumer's mind, said Mr. Hirshfield, referring to a study by a Swedish newspaper. "They were more effective and [users] clicked on more. Less is more in the right circumstances." Those users include users with ad blockers, he said.