Month: August 2020

In the U.S., for instance, 41% of respondents said they used an ad blocker in the latest round of the survey — conducted between April and June 2020 — versus 52% in 2016. (However, the 2020 number was slightly higher than the 39% of those surveyed who said they used an ad blocker in 2016.) In the U.K., those saying they use ad blockers have steadily declined: 47% in 2016; 41% in 2018.

AudienceProject also attached an ad to the online survey and used its measurement technology to detect whether the respondents were actually using blocking software at that moment. In most countries, the sessions blocked on a computer decreased between 2016 and 2018 versus 2020 — though there were slight increases recorded in Germany, Sweden and Finland.

Data from consumer insight company GlobalWebIndex’s latest quarterly survey of more than 100,000 global participants on average also found those saying they used an ad blocker had declined: To 42% in the second quarter of 2020, down from 49% in the year-ago quarter, 46% in 2018 and 48% in 2017.

There are a few intertwining theories as to why fewer people are using ad blockers on their desktops — ranging from the shift to browsing on mobile devices, to publishers and tech companies asserting more discipline around the display of annoying ads like pop-ups and autoplay videos with sound on.

Ben Williams, director of advocacy at Adblock Plus owner Eyeo, acknowledged via email that ad blocking on desktop computers has dropped off since the “halcyon days in the summer of ’16” primarily, he said, because fewer people are browsing on desktop computers.

While desktop ad blocking has declined, mobile ad blocking rose globally by 64% between 2016 and 2019 to 527 million users, according to a separate report released in February from Blockthrough, a company that helps publishers recover revenue lost to ad blocking. That growth was primarily driven by users in Asia and India — particularly through adoption of the UC mobile browser, which was estimated to have more than 400 million monthly active users at the end of 2019. 

Mobile ad blocker user growth hasn’t yet been as profound in the U.S. and European markets. AudienceProject’s research found just 7% of respondents in the U.S. were detected to be blocking ads on mobile devices in 2020, up from 5% in 2018.

Much has changed in the ad industry since Williams‘ “halcyon days” of blocking in the middle of the last decade. Legislation such as the EU’s General Data Protection Regulation and the California Consumer Privacy Act have forced publishers to be more upfront about the data they collect for advertising purposes and the value users receive in return. (Some publishers even moved to prevent ad blocker users from viewing their content.) And as ad blocking grew in popularity, the digital advertising industry was forced to be more introspective about the types of ads that annoy users.

In 2016, a group of companies and trade bodies including Google, GroupM, Procter & Gamble, the Interactive Advertising Bureau and the World Federation of Advertisers formed the Coalition for Better Ads. Overseen by law firm Venable, the cross-industry group identified over a dozen intrusive ad formats that the industry should seek to avoid. In 2018, Google’s Chrome introduced a filter to automatically block out ads that don’t meet the Coalition’s ad standards.

Neal Thurman, director of the Coalition for Better Ads, said the ad blocker install rate on desktop Chrome in North America and Europe has dropped 60% since discussions about forming the group began in late 2016 and the first quarter of 2020.

While not wanting to take the entirety of the credit, Thurman said: “Our standards have had some impact in cleaning up the worst of the worst experiences that really pushed consumers to stop ad blocking.”

“It’s the inevitable maturation of the [digital ad] industry,” he continued. “We’ve proven ourselves — all the numbers show we’re now bigger than TV and print combined — now it’s time to figure out what eggs we broke getting there.”

In the early days, ad blocking was primarily driven by browser extensions. Now browsers are offering anti-tracking and ad-blocking features as standard. On anti-tracking front, those include Apple Safari with its Intelligent Tracking Prevention feature; Firefox’s Enhanced Tracking Protection; and Microsoft Edge’s Enhanced Tracker Prevention. Elsewhere, mobile browsers including UC Browser, Brave, Opera Mini and Adblock Browser block ads by default.

“We have seen a diversification in the types of ad blocking,” said Blockthrough CEO Marty Krátký-Katz. For example, its previous research methodology for observing ad blocker use — inferred by the number of downloads from the open source EasyList blocklist — doesn’t capture the Firefox browser’s blocker when users choose the “strict” setting, which uses the Disconnect.me blocklists. In general, “there’s more dark matter,” especially as some ad blocking software is designed to go undetected, Krátký-Katz said.

At the same time, the AudienceProject survey suggests users’ attitude toward ads might be changing. To be sure, around half of the respondents it surveyed had a negative view towards ads on websites. But in countries like the U.K., fewer respondents had a negative attitude towards those ads in 2020 (54%) than in 2018 (57%). However, in the U.S., more respondents had a negative view this time around (47%) compared with 2018 (42%).

“Ad blocking has evolved into ad filtering in that same period: Today, most ad-blocking products allow ads to pass if they are more respectful of user experience,” said Williams. “This means more ads in more sessions, but fewer annoyed users — even the ‘ad blockers’ — and that’s a good thing.”

In short order, the U.K. announced it’s in the midst of the deepest recession of any major global economy, the Federal Reserve Bank has admitted that U.S. economic growth will be muted until the virus is contained while global unemployment fears are at a high. As businesses brace themselves against these economic headwinds, marketers’ performance — and subsequently their agencies’ performance — are coming under even more scrutiny than they were in the first half of the year. 

What this means is that the traditional drivers of growth such as consumer spending and corporate investment are likely to remain volatile given the financial pressures advertisers are under and so to maintain margin they’re focusing on ruthless cost efficiencies. As Miles Welch, partner at  M&A advisers Waypoint explained: “The feedback we’re getting is that agencies are going to come under pressure throughout the second half of the year because the C-suite is demanding quantifiable proof that marketing investments are working now that the recession is in full swing.”

On one hand, this new urgency to lower costs could foster innovation. Diageo, for example, is taking some parts of its media in-house like brokering fewer, but better relationships with ad tech vendors during the second half of the year, having outsourced other aspects to a PHD-led team from Omnicom over the first, said one source who recently discussed the plan with the company. 

That said, stricter spending rules could reinforce bad habits as one ad tech exec observed: “The agencies we’re talking to at the moment are worried that because they’re having to do so much work with fewer people that there’s a tendency to default to the simplest plans, which usually means buying [the] most ads from either Google or Facebook.”

Increasingly, however, marketers seem prepared to make working under those conditions worthwhile for agencies. With more of their money being spent online since the start of the crisis, those marketers are looking at more performance-based metrics and have concluded that it’s more cost-effective to pay them a commission when those targets are hit.

In other words, more marketers are coming round to the idea of paying agencies more to save money on their media budgets. Usually, media agencies are paid by a set of billable hours worked by agency execs on an account. 

“If you’re using a commission remuneration model then that puts a lot emphasis on the agency and we’re seeing a lot of work done here as advertisers place more emphasis on performance channels,” said Matthew Semple, media management practice lead at Ebiquity.

Seeking transparency in ad tech, squeezing more savings from media dollars and revising remuneration models, these are the sorts of processes that lead to media reviews. And while many of the pitches scheduled for 2020 have been put on hold indefinitely, that doesn’t mean the advertisers behind them aren’t weighing up their options. 

Few things in life are as disruptive as a divorce, particularly during an economic downturn, so marketers are seeking more marriage guidance counseling — as evidenced by how the pandemic has dampened the buzz around in-housing. “While there are some advertisers that decided to plow on with in-housing projects, they’re the exception because most are thinking about making those moves due to how expensive it is to do,” said one consultant on condition of anonymity. 

Still, if both advertisers and agencies can’t reconcile their differences, then marketers are likely to look elsewhere once it’s safer to do so.

“If economies return to some sort of normality over the next six months, then the pitch market is likely to spring back because there are a lot of advertisers who had to postpone account reviews this year,” said Ryan Kangisser, a partner at advisory firm MediaSense. “We’ve had marketers admit to us that the agencies they would consider now could be different from the ones they’d consider in six months’ time as they actively monitor how agencies evolve their business during the crisis.” 

Some marketers are already making these changes, having decided it would be more costly to stick with, rather than twist away from, their current agency. 

Honda, TikTok, Duracell, Starbucks and Burberry are among a raft of advertisers that have either started, resumed or concluded media reviews during the pandemic. In these reviews, cost savings are still a crucial factor in those decisions, according to an exec who has managed some of these reviews. After all, advertisers expect to make at least 10% savings in media pricing and agency fees when they switch accounts, continued the exec on condition of anonymity. And adding a new level of complexity, those marketers are now also prioritizing how agencies can help them adapt to how people have changed during the pandemic. 

“We saw no new business at the start of the pandemic but that’s picked up over the last several weeks,” said Martin Kelly, CEO of Infectious Media. 

More marketers want agencies to help them recalibrate media strategies to broader corporate-wide digital transformation agendas, said Kelly. “We’re not seeing clients do what they did during the last mediapalooza and move to another agency that does pretty much the same thing as the incumbent for a little bit less,” he added.

Indeed, since that last glut of media reviews in 2018, agencies have tried to recast themselves to keep pace with marketers’ expectations. Now, those changes are being tested. 

At Omnicom, for example, its insights and forecasts tool OmniScope has come into sharp focus, as has the Omni data platform that underpins it. The tool is effectively a workflow app that’s replaced the standard processes the agency had in place for one of its largest clients prior to the pandemic, covering everything from investment tracking to scenario planning. 

Not only has the tool allowed those execs on the account to make faster and more informed decisions about when to replace, postpone, cancel and renegotiate ad dollars with media owners, it’s also spread those jobs across more of the team. Having Omni made it easier for the agency to swap in data to different analytic and statistical models as and when they needed to be updated, said Amanda Forrester, director of product marketing at Omnicom’s data and marketing sciences group Annalect.

Flexibility will continue to be important for advertisers, but going into the second half of the year they’re more concerned about when to commit instead of continuing to shift strategies. 

“We had to make different decisions on different scenarios on almost a daily basis, partially during March and April where nothing was happening, but no one knew what was going to happen next in certain markets, said Iain MacMillan, head of consulting at Annalect. “Having a tool that allowed us to relentlessly scenario plan help give our clients confidence. “Marketers don’t expect things to stop changing but they are looking to feel confident — and find stability.”

On the plus side, WSJ’s digital subscriptions have grown by 23% and its branded content revenue has grown as well during the coronavirus crisis, according to chief revenue officer Josh Stinchcomb, although he wouldn’t say by how much. That’s thanks to the title’s established prominence with business-focused advertisers. And at its Digital Ad Upfronts in June, the publisher announced Trust Direct, an ad product that allows clients like Deloitte to self-publish content quickly, the title’s answer to the problems marketers have in responding to a rapidly-moving market.  

Speaking to Digiday, Stinchcomb discusses how The Wall Street Journal has been strengthening its ad offering and how it navigates relationships with platforms. The below has been edited for length and clarity.  

Explain where and why you have seen digital ad revenue growth? 

We’ve had a lot of great digital ad momentum lately. We’ve had growth for the last four out of six quarters. We’re largely a B2B ad platform — 65% of our ad revenue is B2B — those sectors that have held up relatively well during COVID, like productivity tech, financial services, healthcare. We’re well-positioned for where there is still growth in the market.

A somewhat surprising bounceback has been high-end residential real estate, which has seen great performance for digital and print. There’s pent-up demand, a lot of supply and so a lot of marketing activities, which was an unanticipated bright spot for B2C. Luxury is beginning to come back, it’s less dire than it seemed to be three months ago. 

Aside from external market conditions, what has WSJ done to weather the storm?

We have been very focused on our capabilities for either end of the advertising barbell: High-touch custom solutions [virtual events and branded content] and data-driven programmatic. For high-touch custom content, we’ve brought in new talent and honed the focus of the content we offer. Marketing is moving to the speed of news. A news organization used to pivoting quickly and responding in near real-time is a great branded content partner for marketers right now, and we’ve seen that result. Long-term, the close rate has gone up, the renewal rate has increased by 17% percentage points. At the foundation of the new fiscal year, already there is revenue locked in for multi-year deals. That’s recurring revenue we never historically had in advertising. 

For our programmatic data-driven business, our private marketplace revenue has grown north of 50% in the last year. We’ve seen CPMs grow 15% [in the last 12 months], that bucks every other ad pricing trend. That’s a result of the return on investment in our first-party data collection and ad tech, which has been a focus for two years. We have been able to increase yield by segmenting audiences in smarter ways and understanding price sensitivity among buyers. But the open exchange is only 15% of our digital ad business.

How has the team changed?

Over two years we’ve turned over a third of the team as we seek out talent that’s a better fit for purpose, driven by high-touch custom and sophisticated data-driven programmatic. We’ve changed the composition of the team, taken down the number of traditional sales roles by 25% but added more programmatic specialists, content creation specialists. The goal hasn’t been to get cheaper but to get better composed, that’s ongoing and will continue. 

Not all publishers can have a relationship with tech platforms that leads to revenue. How has revenue grown for Apple News+? 

There are two revenue streams that come through that partnership: A subscription revenue stream, where we share in the subscription revenue and our brand has done very well in there — our contribution to the total time spent correlates to our revenue. It does quite well with new audiences, we have more females, a younger audience, it brings our brand to a broader audience.

There is an advertising component, a relatively small part of our overall revenue. [Apple News] is a nascent ad platform overall, but they are incredibly collaborative. We have other partnerships like video with Twitter, audio with Gimlet, now Spotify. I see those as new money and a relatively light lift. These are in the low-touch, high-growth bucket which is a good thing for us. Both [revenue streams] are growing and quite comparable.

How many subscribers convert from Apple News+ to WSJ subscribers?

We have been public about our total subscription growth, that 3 million does not include Apple News+ readers, those are all incremental.

Were you told about the recent Apple News+ changes?

I did see that, but I don’t know the full analysis or what that means for our traffic generated.

How do you negotiate with the platforms, how does it help to be the WSJ?

We’re willing to engage. News Corp has been vocal about the platforms, we’re going into this with eyes wide open. But it is difficult, we look to see where we can find common ground. It helps to be the WSJ, it carries cache with readers, journalists and the world, our ability to negotiate enhanced. But every platform is different, the nuances are different and it remains complicated. These are entities we partner with, they are clients, they advertise with us, we — at times — take issue how are our journalism is treated [by platforms].

And advertisers that paused campaigns, rather than canceling them, in the spring, are starting to talk about new campaigns that might run later in the third quarter or the beginning of the fourth, sources at three different travel publications told Digiday.

Even with traffic and views well behind where they were a year ago, the audience is ahead of advertiser interest. But after a two-month stretch where initiating new business was nearly impossible, the travel publishers will take good news where they can find it.

“’Pivot’ has been the word the past few months,” said Jen Mormile, chief business officer of Condé Nast’s Lifestyle division, which includes Condé Nast Traveler.

While most brands paused or slowed their ad spending at the onset of the pandemic, travel advertising as a category shut down almost completely. In April, ad spending in the category was down 93% year over year, according to MediaRadar data. Over the next two months, even with a slight rebound, spending remained more than 80% lower than it had been year over year.

During those lean months, publications had to get creative to bring money in the door. Some, such as Tastemade Travel, relied initially on platform monetization to make up for the lack of direct deals, said Jeff Imberman, Tastemade’s head of sales and brand partnerships. The Culture Trip reoriented its advertising strategy around streaming services, alcohol and groceries, vp of global sales Kate Glover said. The site also spent some time figuring out how to monetize things like bike and scooter rentals.

Many sites also focused on producing more content focused on local trips. “We pivoted towards DMOs [destination marketing organizations], but specifically on opportunities around domestic tourism to encourage staycation style trips,” Glover said.

In June, things began to revive somewhat. Advertisers that had paused campaigns, rather than canceling them, started to come back, mostly to talk about resuming campaigns in September, said Pete Spande, Insider’s chief revenue officer.

Many of those campaigns required new work around different messaging, with new production ideas that reflected the changes that continue to plague all kinds of video production operations. Instead of shots of cohosts gallivanting around on holiday, for example, Insider’s custom productions now might rely on voice-overs on footage shot on location.

And instead of messaging that focuses purely on a hotel or city’s perks, virtually all campaigns must now include some mention of the measures a client has taken to ensure the safety of their customers.

That shift remains a challenge for many marketers. “If you’re a destination, you know how to talk about how incredible your city, town, country is,” Mormile said. “But now, what’s at the forefront of the conversation is the safety and the changes and all the front of the house fixes that have been made.”  

In the past three or so weeks, a few advertisers have begun to send along RFPs for the fourth quarter, or have at least resumed planning discussions, Spande said. And hotels and tourism boards, for example, hoping to reach people planning trips they might not take for another six to 12 months, began to come back this summer as well. “The booking window is further out, so long-haul marketing today impacts 2021 activity and action,” Mormile said.

Some have come from old clients trying to reach new kinds of customers. In the past couple months, hotels have begun focusing on reaching people who are traveling not for business or vacations, but to visit family members while also maintaining a social distance.

“What we’re seeing is when they go to [visit] a friend or a relative, they want to keep their family member safe,” Mormile said.

But these small improvements have not brought things back to normal so sites continue to overhaul their content strategy.

Condé Nast Traveler, for example, will launch an editorial program next month called The New Standard, which seeks to recognize the improvements and changes that hotels and other businesses have made to make customers feel safe.

BuzzFeed’s travel vertical, BringMe, has seen advertisers start to come back to the table in the past month or two, said Louise Khong, BringMe’s director of content strategy. The BuzzFeed brand had big plans this year to produce content aimed at driving people to book stays at Hilton properties.

But its content strategy lately has been different. BringMe once relied heavily on sending crews out to shoot on location, gathering footage it could use across several different videos. These days, it focuses more on content that can be produced locally or by remote producers using their iPhones. It also focuses more on content about staycations, or recipes one can cook to mimic being someplace new.

Video views are up 39% from their low point in April, though still well below where they were at a similar point last year, according to CrowdTangle data.

“We’re seeing a good upward trajectory,” Khong said.