Last month, Apple, the California-based consumer electronics major, set the cat among the pigeons. When it announced the launch of the iOS 9, labelled as the world’s most advanced mobile operating system, it created a sharp divide amongst the digital media owners and the consumers.
With the iOS 9 users can download apps from the App Store that would block ads from their mobile devices. Consumers who were bombarded by ads heaved a huge sigh of relief. The ad blockers would not just cut down ads, they would also enable faster downloads, cut down data usage and hence reduce the data charges.
Digital media owners including search giant Google were naturally concerned. In an interview with this newspaper (on page 2), Sridhar Ramaswamy, Senior Vice-President of Ads & Commerce, and the man in charge of the search giant’s nearly $60 billion worth of advertising revenues, came down hard on ad blocking apps. He says a “small set of not so great players is poisoning the well” and calls for an active debate on the issue. “It’s time for us to proactively talk about this instead of ignoring the issue. Because that leads to rise of ad blockers who indiscriminately punish every publisher,” he says.
Too early for alarm?
According to some estimates like the PageFair and Adobe 2015 Ad Blocking Report, the rise of ad blockers will have serious repercussions. The study says that the estimated loss of global revenue due to blocked advertising during 2015 was $21.8 billion and it could go up to as much as $41.4 billion in 2016. In countries like the US, the usage of ad blockers has shot up by as much as 48 per cent over the last one year. That there are many consumers eager to block out ads was further proven in the last few days. Barely two weeks after the iOS 9 operating system was available for downloads, ad blocking apps on the App Store were among the leading apps that consumers were prepared to pay for.
But many digital specialists that cat.a.lyst interviewed in India feel that it’s too early to press the alarm bells in India. Pratik Gupta, co-founder of digital agency FoxyMoron, says that he will believe the numbers only when it actually happens. “I am not worried at this particular time for sure,” he says. That’s because other ad blockers like the YouTube Ad Blocker have existed for around 3-4 years but have been slow to take off. “Not many people have taken on to those blockers. It has not created a big impact,” he says.
Gopa Kumar, vice-president of digital agency Isobar, believes that as of now, the impact on ad blocking in India may not be that much as iOS is not a primary platform in India. “Eventually if it becomes a mainstream phenomenon, it will turn out to be a boon for users who are bombarded with ads and don’t want to get unwanted or unsolicited ads when they are consuming content,” he says. Kumar, however, puts out a note of caution. “It poses threat to advertisers who rely on display advertising both in desktop and mobile. I also feel it will hurt the app economy the most as they rely heavily on app advertising either to drive downloads or visits,” he says. Gupta points out that the debate on ad blockers makes it important to create ads that sit lightly on the pages and are coded right.
Opportunity for good content
Divya Radhakrishnan, managing director, Helios Media, a specialty services company for broadcasters, says that ultimately there will be takers for both ads and no ads. She points out to the example of the television medium where there are channels without ads, where subscribers pay a premium.
She adds that the traditional format of pushing your television commercial on digital will not live long and points out to a classic case of timing by online retailer for ethnic wear and accessories, Craftsvilla. The brand released an ad set to the tune of Farida Khanum’s classic ghazal, Aaj jaane ki zid na karo less than a week back. Three days ago, the legendary ghazal singer hit the headlines once again for her phenomenal performance of the same ghazal at Coke Studio. “Unless they got the timing right by a huge stroke of luck, this is a good case of digital advertising,” says Radhakrishnan.
Kumar says, “There is huge opportunity for advertisers and agency to use this to create great content which will help them get past this. Native advertising and great story telling from brands is the way forward. We must use this to our advantage than looking at it as a roadblock.” Absolutely!