Remember that report we cited a couple of weeks back about how ad-blocking is proliferating? Not so fast, says Buzzfeed. The report claims that publishers will lose $21.8 billion this year due to ad-blocking, but Buzzfeed warns that figure is arrived at via potentially faulty methodology.
Pagefair, the company that came up with it, has a vested interest in making ad-blocking look scary, because helping publishers get around ad-blocking is its business. But Buzzfeed notes:
To get to the $21.8 billion dollar figure, it assumed that the blocked ads, if added to the overall pool of ad inventory, would command the same rates as those in a market without them. But in a real world situation, if ad blocking went away, the market would flood with an increased supply of ad inventory, dropping rates for all ads and leading to a much smaller loss figure than $21.8 billion.
Pagefair’s estimate implies that advertising companies are charging for ads that never appear, when that is not actually the case. Advertisers don’t actually pay anything for a blocked advertisement. The ad is never shown to begin with, so it isn’t charged.
Furthermore, it’s not as if consumers are insulated away from every possible ad. Most ad-blockers are only effective in PC web browsers. Mobile browsers and apps, which are being used by more and more people every day, are still perfectly viable, and there’s still plenty of good money being spent there.
So, while ad-blocking might be effective in some areas, it’s by no means the apocalypse that Pagefair’s report suggests. It will be interesting to see what the landscape looks like given another few years.
Maybe I’m just the wrong traget audience, but I don’t think I’ve ever purchased a book based on a web ad I’ve seen. I’m of the mind that the only people who truly benefit from ads are those who sell them.
This is similar to what the music industry says. We lose xx dollars because of illegal downloads. However, many people who illegally download won’t buy their music anyway.