When your client likes adblock more than you
We have long known about the phenomenon of shifting the attention of advertisers and their money towards the Internet and digital media. However, the last few years are signals that digital advertising can no longer function quietly. This is due to the fact that the popularity of various mechanisms that block its content is growing.
According to research in the US, 38% of adult Internet users support ad blocking. In Poland, even more, because at the end of 2017 this figure was 42%. In November 2018, the Association of Internet Industry Employers IAB Polska published a report on the extent of ad blocking on the home Internet. He showed that the number of blockers in our country has increased by as much as 200% in five years, and among PC users it already exceeds 90% (1)! In smartphones and tablets, the percentage of blocking is much lower, but it is growing.
Ad blocking is only part of the problem, and even the result of a combination of reasons for the decline in the effectiveness of advertising and marketing in the traditional sense (2). One of the reasons this business is retreating is the generational change and mentality of younger recipients in the wake of technological change.
The Zetas don't want publicity
According to a Bloomberg study, the so-called Generation Z (i.e. people born after 2000 - although, according to some sources, 1995 is already a turning point), this year it should exceed the number millennia (born in the 80s and 90s), reaching about 32% of the total population in developed countries. Obviously, this information has a strong business and promotional tone, which in turn also has a profound impact on the media, the Internet and social platforms. Millennials have an estimated purchasing power of $65 billion, according to research firm Nielsen, which is now below the $100 billion Zeci can spend on purchases.
There have been many analyzes attempting to capture the needs of Generation Z. In the media (in this case equivalent to the Internet media), first of all, they are looking for strongly personalized experience, with a very strong emphasis on privacy protection. Another phenomenon that distinguishes this generation from previous ones is that its representatives they prefer entertainment to relationships. This is what the study shows, which seems to be confirmed by the websites they chose, most notably TikTok. Their attitude towards traditional advertising is illustrated by popular memes, such as, for example, parody advertising on social networks, stylized as old newspaper ads (cover).
The communication and information platforms favored by this generation are described by experts as "Fleeting" (). An example of such a service is Snapchat, an application for sending videos and photos that are available for viewing for no more than 60 seconds.
In relation to this generation, phenomena are quite common that are unfavorable for the media that traditionally live off advertising (ie websites). Young consumers are more willing to switch to services and services. user funded (for example, Netflix or Spotify), abandoning the traditional advertising model. Youth applied ad units on a massive scale. However, this does not mean so much the desire to "deceive" publishers, as some would like to see it, but a complete rejection of the traditional media-advertising model. If a publisher orders the ad-blocking mechanism to be disabled so that the user can navigate to the content, young people are more likely to opt out of serving it. On the income statement, ad omission wins.
The advertising model of online media, which emerged two decades ago, was largely the same as the old funding mechanism. In the past, a newspaper was inexpensive because the publishers made money from advertising. TV and radio were free (plus a subscription, of course), but you had to put up with ads. The texts on the portal could be read, but the annoying banners had to be removed first. Over time, advertising on the Internet has become more and more aggressive and persistent. Older Internet users probably remember situations when it was almost impossible to notice the text due to pop-up animations and videos. Closing them before they "played" was difficult, and sometimes not possible at all.
Driven by noisy, intrusive advertising, media models now seem destined to fail. Models are not the media themselves, because it cannot be ruled out that the latter will find other ways to monetize their activities. However, El Dorado's ads are apparently ending because users have rebelled against the ads.
Contrary to popular belief, young people are not worried about this at all. subscription systemsalthough among the content for which they are willing to pay, there are no articles, no reports, no journalism, which is traditionally offered by the media. With Spotify, you can get rid of videos for a small fee. With Netflix, you can pay a subscription fee to watch whatever your heart desires. This offer suits users.
2. Reduced effectiveness of advertising
Information and coverage instead of advertising
There is also a problem with the ad itself. Not only have the old models of creating and selling media stopped working, but the traditional editing of advertising that the media lived so well off is experiencing its own little apocalypse.
Howard Gossage, a colorful character in the golden era of advertising in the 60s, became famous for the phrase: “People read what they are interested in. Sometimes it's an advertisement.
Many commentators believe that this sentence contains the key to understanding the effectiveness of advertising. Must be interesting for the recipientand not selfish, as, unfortunately, often happens. Advertisers should also keep in mind that audience changes over time. A technique created primarily by the advertising and marketing world to capture changes in successive "generations" should help create intended virtual recipients of advertising messages.
In the "old" world before Facebook and Google, there were no efficient, cheap ways to reach people who were looking for niche products and services. Successful companies offered products aimed at the general public and advertised with the expectation of a mass recipient - hundreds of thousands, millions of people at once. Successful media advertising campaigns of the previous era were typically targeted by large restaurant chains (such as McDonald's), car manufacturers, hypermarkets, insurance companies, or consumer goods brands run by large mass corporations.
Entering the modern era, where the Internet has supplanted the traditional retail model with stores and well-known brands, has significantly shortens the distance between buyer and seller and removes various barriers, such as geographical ones. The Internet has given buyers and sellers unprecedented access to each other. Today, a company offering a specific, niche thing has a chance, skillfully using Internet tools, to reach all its customers, which are many. - for example, Bevel, which produces shaving kits specifically for black men. In the old world, advertising a particular product was not profitable for large companies and retail chains, because it turned out to be too expensive per unit sold. The Internet lowers this bill and makes marketing less common products profitable.
Sales and profitability are driven by tools and advertising from Google and Facebook. The cost of acquiring a potential customer remains low given the possibility of remarketing and customer retention through the many communication solutions that the Internet offers.
Increasing the accuracy of data processing can ultimately lead to a world in which the individual consumer has quick access to products that meet his biological, rather than consumer needs. This is a world without brands and trademarks, because in a reality based on information, not advertising, the concept of “brand trust” does not exist. An informed consumer will buy the cheaper of two identical products. For example, he will know that the active ingredient in the drug is ibuprofen, and Dolgit, Ibuprom, Ibum or Nurofen are just marketing constructs. They will make a conscious choice in what form and in what packaging they want to buy ibuprofen.
The sooner advertisers understand this new world, and the sooner they stop fighting to bring back the "good old days" in the advertising industry, the better for them. The game is not a share of the profits of Google or Facebook, because the Internet giants are more likely to not want to share their profits. It's about information and data. And it is this resource, and not advertising revenue, that is monopolized by Internet giants. And since it is not said at all that user information and private data are controlled and should be controlled only by Google and Facebook, there is still something to fight for.
In the Trade Innovation Report, which readers of MT will find in this issue, we write about new methods based on the latest technologies - AI, AR, VR and - new methods of selling, building conversations, strengthening relationships with individual customers, personalizing the offer and many other new methods to attract buyers. All this can replace traditional forms of advertising and marketing. Of course, companies will have to learn this, but they have also learned how to advertise effectively in the past.
