Does Ad Blocking Hurt Good Websites?

2 Flares 2 Flares ×

Ads BlockedAn interesting post over at ARS Technica about how ad blocking hurts websites. The post is interesting for two reasons. First, the article, written by ARS Technica’s founder and owner, goes into more detail than is often the case regarding how ad supported websites work and how blocking those ads can hurt the website in question by depriving it of the revenue it requires to keep running. Second, the article mentions a “failed experiment” in which they blocked users who were blocking ads from viewing the site’s content.

The article, which I highly recommend you read, mentions an oft misunderstood concept about online advertising, namely, that all website advertisements pay per click. While, it is true that numerous popular advertising programs, such as Google AdSense, pay content publishers, or website owners, on a per click basis for some ads, that is not always the case. Even within the AdSense program, there are advertisements that pay based on “impressions”, or how often they are seen. However, for low-traffic websites, these amounts never show up as anything more than a penny here or there. For these website owners making money with AdSense means pay per click.

Because there are many more low-traffic web properties than there are high-traffic properties, and because those same numerous low-traffic websites write more about ad programs than higher traffic websites, they’re experiences and opinions are more widely disseminated. The result is that most people believe that only clicking on ads generates any revenues, and since they aren’t going to click on ads anyway, blocking them causes no damage to websites.

High Traffic Websites Earn Revenue Just By Showing Ads No Clicks Required

However, on a high-traffic website, such as ARS Technica, advertisers often pay based not only based on clicks, but often based on the number of impressions the ad generates as well. The most common standard advertising rate in this arena is based on one-thousand impressions, which is often notated as CPM (Cost Per Thousand). This is occasionally misunderstood as cost per million based on the erroneous assumption that M stands for a number that starts with M, when, in fact, it is the Roman numeral M which is 1,000. (You see the M all the time in movie credits that use Roman numerals for their dates.)

For example, a high-traffic website might get $1.00 for every 1,000 impressions. In other words, for every 1,000 times an advertisement is displayed, the website would get $1.00. (These numbers are all for example purposes only and do not necessarily correlate to real advertising numbers, rates, costs, or payments.) If the website in question gets 200,000 page views per day, that would add up to $200 per day of revenue. Over the course of a month, that is $6,000 which adds up to a nice $72,000 per year.

Even at that rate, you aren’t talking about a full-fledged publishing business with employees and benefits and the like. To get to those kind of numbers, you either need higher rates, or more traffic. Either way, you can see why the number of people with actual real world experience in this area is low. A site like ARS Technica get upwards of 10,000,000 page views per day, according to Alexa.

Re-do the math and you can see the kinds of numbers we are talking about here.

So, when a site like this notices that 40% of its users are blocking ads from being displayed, it isn’t just nickels and dimes we are talking about.

Ad Supported Websites Block Users Who Block Ads

Also in the article, the author talks about what he calls a failed experiment whereby the company kept users who used ad blocking software, most likely the Ad Block Plus plug-in for Firefox and others, from seeing the content on the website. Unfortunately, one of the major problems with the experiment was a lack of communication with the readers to let them know what was going on.

The other problem is that a certain subset of user populations is fanatical in both their efforts to block ads and their “right” to do so. Needless to say, there was some backlash.

But, did some good come out of all this?

I set my Firefox Ad Block Plus plugin to Disabled for the arstechnica.com domain. We’ll see how it goes. I’m perfectly willing to let websites display ads to generate the revenues required to continue their efforts. I am not, however, willing to let those ads slow down my browsing experience, and I am also not willing to let them be overly intrusive. I installed ad block plus when Kontera and its ilk came out and started manipulating text to have links that popped up ads if you so much as got your mouse close to them. That is unacceptable.

Furthermore, I am NOT going to unblock Flash on ARS Technica or any other website. Flash is a horribly bloated coding system that just gets worse by the day. Open a webpage with a few flash based ads on it, and watch your browser’s memory usage double. Since I like to leave tabs open while I do other things, those resource pig flash ads take up more and more system resources and that is not acceptable.

More interestingly, for the time being anyway, I have in the back of my mind the thought that some of my favorite websites (I read ARS Technica a lot whether directly or via RSS Feed) need to have those ads display to keep running. Otherwise, they’ll either disappear, become lower quality, or stoop to writing pay for review or pay for coverage articles.

2 Flares Twitter 0 Facebook 2 Google+ 0 Pin It Share 0 Reddit 0 StumbleUpon 0 2 Flares ×

6 thoughts on “Does Ad Blocking Hurt Good Websites?”

  1. belair says:

    I’ve wondered about this dilemma for some time now. I’ve had ad-blockers for over 10 years now and will not stop using them. I understand I am potentially missing out in a perfect digital marketing system that could be telling me all about and nothing but the exact things i would most be interested in. in a world of digital computer hyper local target marketing it would encourage democratic business.

    1. WGHubris says:

      Unfortunately, the ad system is far from ideal. In fact, I re-block many sites because they (or the ads they allow) abuse the privilege with ridiculous pop-ups, pop-unders, or intrusive animation or movement. I’m willing to allow reasonable advertising in order to get free high-quality content, but I won’t be abused by any site, regardless of what it offers.

  2. Pingback: Firefox Feeling Lighter? - News - BestHubris.com Best Hubris
  3. Trackback: Firefox Feeling Lighter? - News - BestHubris.com Best Hubris
  4. David says:

    The issue is not whether to block or not to block ads it is more fundamental.

    There is an implicit assumption that advertising in its current format will continue as it has always done. In other words an industrial-age concept of billboards can be successfully grafted onto the information superhighway.

    This is working at the moment only because an information age alternative has not yet emerged where vendors can meet with consumers in a more efficient, less intrusive and more cost-effective environment.

    Information age advertising mediums are inevitable and are starting to appear right now. One example is the Customer Satisfaction Monitor which has recently been launched.

    This Customer Satisfaction Monitor (http://www.customersatisfactionmonitor.com) answers the three most important pre-purchase questions and introduces a new step into the sales process. Advertisers can now target prospects at a very crucial point in the sales process much more cost-effectively and less intrusively because the consumer is in control.

    As an advertiser it will be increasingly uneconomical to advertise elsewhere because potential customers will be ambushed by competitors at services like the Customer Satisfaction Monitor. Industrial-age advertising will, as a result, wither on the vine.

    For those services relying on advertising it is time to rethink your revenue model.

    1. WGHubris says:

      This is a well thought out and seemingly personalized plug, so I’m going to allow it 🙂

      First and foremost, regardless of what may or may not come to pass in the future of advertising, the fact is that there are currently advertisers will to pay to display ads on a websites and webpages and that these ads form a major part of the revenue of many sites. Blocking these ads shuts off that revenue stream. Care or don’t care, it is up to you. However, those writers have mortgages and families too. If they do it on the side, it will be less than it is now. Also, servers, bandwidth, and so on aren’t free either. Many sites and advertisers go too far which is how ad blocking got started in the first place. However, for responsible websites that don’t allow ads to detract from the experience or the information, I’m willing to turn off my ad blocker in order to keep them around.

      Interestingly, this may be the factor that ultimately drives better, less intrusive advertising. Every browser comes with pop-blockers enabled by default due to abuse. How long before every browser comes with ad-blocking built-in? Considering it is the #1 source of revenue for virtually all of Microsoft’s competitors, it could be incredibly strategic for Microsoft to be the first vendor to implement built-in, enabled by default, ad blocking to starve the others of revenues.

      There is a misconception that all advertising is used to drive an immediate purchase from customers. Actually, a very small percentage of advertising actually works this way, which is why most “big” advertisers don’t really bother to have anything to do with the so-called pay-per-click advertising campaigns.

      The majority of advertising is actually designed to create an impression in your mind that you will hopefully remember (subconsciously or not) when it eventually come time for you to make a purchase. Nobody expects a television viewer to run out in the middle of House to buy a new Accord, a six-pack of Coors Light, or even a McDonald’s value meal. Rather, the next time you are driving down the road, that McDonald’s sign might jog the idea that you would like some fries and since they have great deals going on now (on what you can’t remember exactly) you’ll pull into the parking lot. Likewise, when you start thinking about buying a car, you might remember that Accords are on sale or have special financing or are safer/faster/plusher than others.

      Mostly, it is about familiarity. Several years ago on a car lot a salesman mentioned the Chevy Malibu (used). We had never even HEARD of that car. There was nothing that salesman could say or do to get us to even look at it. After all, we reasoned, if it were anything worth looking at, we at least would have heard the name of it.

      Good luck with your venture. It sounds promising, however, it seems that getting the right people to answer questions is always tough, and I think you will find that no one wants MORE steps in the buying process 🙂

  5. WG Hubris says:

    Some readers asked about this website in particular. This site does not generate anywhere near the kind of traffic required to worry about impression based revenue. Occasionally, I will see $0.01 or $0.03 in my AdSense reports that is from ads that pay per impression, but, for all intents and purposes, this site only makes money when you click an ad.

Leave a Reply

Your email address will not be published. Required fields are marked *

2 Flares Twitter 0 Facebook 2 Google+ 0 Pin It Share 0 Reddit 0 StumbleUpon 0 2 Flares ×