Category results for "Advertising"

Viewability problems spread to video ads on social

September 17, 2015 Mark Glaser, Founder and Publisher – MediaShift

A funny thing happened on the way to social distribution domination. While publishers have started to test more and more original content on social platforms such as Facebook, YouTube and Snapchat, those platforms are still suffering from problems of viewability for ads—especially with video.

Let’s look at the statistics: The Media Rating Council and the Interactive Advertising Bureau suggests a video ad is viewable when at least half of the ad’s pixels are visible on a screen for at least two consecutive seconds. An April study by Google found the average viewability of video ads across the web (not taking YouTube into account) was 54%. When considering video ads on YouTube, that figure jumped to 91% across different devices and apps — and video ads were significantly more viewable on mobile and tablet as opposed to desktop. Non-viewable ads, meanwhile, were either scrolled off the screen or abandoned in less than two seconds.

Short Attention Span on Snapchat
Yet just because ads might be more viewable on mobile than on desktop doesn’t discount the anxiety surrounding their worth. A recent article on Digiday found a full 70% of Snapchat’s mostly millennial audience had moved on from an ad after only three seconds. Given Snapchat currently charges brands for video ads that are viewed for even less than a second, it’s not only raised discussion on the definition on viewability, but also the relative value of these ads for brands.

“Snapchat is using this measurement that just seems off from what brands and clients want and where the rest of the industry is going,” a digital marketing insider with knowledge of Snapchat’s ad model told Garrett Sloane of Digiday. “If an ad is on the screen for less than a second, it’s hard to imagine it made an impression.”

Despite the ongoing debate on the impact of technology giants becoming the gatekeepers for brands and publishers, the platforms will have to work more closely with these parties if they are all going to have long-term, stable ad revenues. Twitter, for example, offers six-second pre-roll ads. Facebook also “teaches brands how to capture attention within three seconds, using muted auto-play videos, which people can scroll right past,” Sloane wrote in Digiday.

Third-Party Verification?
Some companies are demanding third-party tools be used to evaluate which advertisements are actually being seen, to help ensure the accuracy of the information and maintain higher viewability. Complaints from Uniliver and Kelloggs are suspected to be behind YouTube’s announcement to use third-party tools instead of its own in-house measuring tool, Active View.

But this also has its negative consequences. Facebook, for instance, has argued that “third-party verification view tags often slow down consumer experience and don’t always report views consistently,” and has hinted that these third-party verification tools could compromise valuable user data. And Facebook — whose log-in can track which desktop or mobile devices people use — has access to the consumer data that is so crucial to advertisers. That data is difficult for most publishers to obtain otherwise, and generally harder to determine on mobile, because the varying size of different gadgets require different kinds of advertising.

Maintaining a quality user experience versus earning revenue from advertising seems to be the trade-off that’s happening on social platforms. Snapchat, for instance, maintains brands won’t be charged if viewers skip an ad entirely. But it also offers its users the chance to skip any advertisement they wish.

These are early days for video ads on social platforms, so there could be more standards among the major players in the near future. That could go a long way toward addressing viewability issues. Snapchat videos, for instance, take up the entire screen (so eyes can’t wander), and also use the vertical video format which leads to higher view rates.

Or publishers and brands could also try another route to better viewability: better ads, and even native ads that are creative enough for people to play through and share without skipping in disgust.

Advertising | Industry-Research

Do Millennials Consume Content, Ads and Shop Differently?

August 28, 2015 Research Team—DCN

A new report from Adroit Digital compares Millennials’ shopping behaviors and advertising preferences with those of their older counterparts. While Adroit points out that a great deal of research closely examines generational behaviors and attributes, this report focuses on behaviors, particularly how Millennials shop, consume content and respond to advertising as compared with older shoppers. Adroit Digital conducted a study to ask Millennials and those 35 and older about their shopping and content consumption habits. The study was fielded from April 24, 2015, through May 24, 2015 and targeted a random sample of 1,000 US and Canadian consumers who self-identified as 18–34 years of age and who owned both a smartphone and a personal computer, and 500 US and Canadian consumers who self-identified as age 35 and older and owned both a smartphone and a personal computer.

Key findings include:

Both Millennials and those 35 and older do the majority of retail browsing in-store—57% and 61%, respectively.
When it comes to which online social medium affects retail purchases the most, both Millennials and those 35+ chose online review sites, 55% and 54%, respectively.
The majority of respondents are also more likely to click on a mobile ad over a desktop ad—55% of those 18–34 and 52% of those 35+.
The majority of survey respondents replied that online and/or mobile advertising does affect what they purchase—75% of those 18–34 and 73% of those 35+.
Millennials are slightly more likely to click on a native ad than a banner ad—81% compared with 75% of those 35+.
Millennials are slightly more bothered by advertisers’ remarketing efforts—83% of those 18–34 vs. 77% of those 35+.
When it comes to noticing ads between devices, the majority of both age groups surveyed report that ads on their mobile devices grab their attention more than ads on PCs.

Advertising | Perspectives

Where’s the signal? (And why it matters to digital advertisers)

August 19, 2015 DCN

Philosopher Thomas Wells, in an essay for the Australian Broadcasting Corporation, argues that advertising is a market failure:

The advertising industry consists of the buying and selling of your attention between third parties without your consent. That means that the cost of producing the good – access to your attention – doesn’t reflect its full social cost.

…

Since advertisers pay less to access your attention than your attention is worth to you, an excessive (inefficient) amount of advertising is produced.

For the web, though, there is still time to turn advertising into a net positive, if we fix a few things.

The main reason advertising exists is to help deal with information asymmetry. Nobel Prize-winning economist George Akerlof pointed out that, in a market where low-quality and high-quality sellers compete, and sellers know their products better than buyers do, high-quality sellers have trouble staying in business. When the buyer can’t tell a low-quality car, a lemon, from a high-quality car, no buyer can justify paying more than a lemon’s value for any car.

Over thousands of years, people have figured out ways to deal with Akerlof’s market for lemons problem. Licensing of sellers, product reviews, and protecting trademarks are all ways to give some advantage to quality sellers.

Advertising is another piece of the solution. Tom Goodwin compares advertising to stone buildings for banks, and writes:

Old world advertising used to be the same, the very act of investing in TV, buying a premium billboard, taking an ad in Vogue, became brand building because of the cost, not despite. The general public doesn’t know rate cards, but there was a tacit, enduring, innate feeling that companies that advertised were companies of quality.

Perceived advertising costs matter to users. In The Waste in Advertising Is the Part That Works, Tim Ambler and E. Ann Hollier describe a signaling test based on showing “expensive” and “degraded” versions of the same TV commercials to experimental subjects, and found:

[P]erceived expense influences perceptions of brand quality, which in turn is the most critical predictor of a participant’s inclination to purchase a brand.

Wells, however, argues that signaling is a waste. He writes:

Like banks housed in grand marbled buildings, companies which pour vast amounts of money into advertising campaigns must be supremely confident about the quality of their products and its long-term sales. Otherwise they couldn’t afford to burn so much money on ridiculous Super Bowl ads. This argument rather reminds me of John Maynard Keynes’s suggestion that in a recession caused by a collapse of aggregate demand one could solve the problem by burying bottles filled with bank notes and then leaving it to private enterprise to dig them up again.

But signaling isn’t just based on the production values of the ad.

Ads appear with content. Signal is proportional to the value of the content, not just the ad itself. In signal-carrying media such as magazines, a positive feedback loop can emerge. Valuable signal-carrying ads bring in money for content, whose quality and perceived cost increases signaling power, therefore ad rates, and so on. This can make a signal-carrying medium a great business to be in.

But when advertisers try to target users individually, signaling breaks down. Targeting turns an ad into the digital version of a cold call. Targeted ads tend to “burn out” the medium in which they appear, through a Peak Advertising effect. Each new targetable medium falls in value and popularity as users figure it out, filter it, or get their governments to restrict it.

Even when a web ad appears on expensive content, it fails to carry the signal that it would convey in a less targetable medium. Users are aware that ads “follow them around,” so instead of viewing an ad as part of an expensive, signal-carrying ad buy, even an ad on high-quality content could be an example of cheap targeting.

Solutions
The two extreme positions on web ads each miss something. Ad blocking everywhere and eliminating ad-supported content is clearly suboptimal. The existence of magazines that people voluntarily subscribe to is proof that some level of advertising can work.

The other extreme is anti-adblocking, telling users to stay in an unprotected, targetable state. This doesn’t work, not just because of the malvertising problem, which make some protection a necessity, but because of signaling failure.

A third way is needed. Fortunately, tracking protection tools are able to block cold-call-like targeted ads while permitting signal-carrying ads. Instead of waiting for more and more users to give up on advertising and get an ad blocker, publishers can help and encourage users to run tracking protection tools instead. But if sites fail to turn the web into a signal-carrying medium, web ads could slide into a no-win struggle like email spam/anti-spam, and anti-advertising philosophy could turn out to be right after all.

Don Marti (@dmarti) is a contributor of code and documentation to the aloodo.org project, a low-friction way for sites and brands to reclaim the value of online advertising from fraud and ad blocking. He is the former editor of Linux Journal. Don is the subject of an out-of-date Wikipedia article, which he will not edit himself, but wishes that someone would.

Advertising | Industry-Research

Viewability Continues to Trouble the Marketplace

August 18, 2015 DCN

Display ads were 11% less viewable in a year-over-year comparison reports Integral Ad Science in their Q2 2015 Media Quality Report. The viewability measure for display dropped from 49.4% in 2Q 2014 to 44% in Q2 2015. In fact, publisher sites decreased their viewability rate from 55.5% to 50.1% as did ad networks and exchanges from 45% to 39.9%.

During the same quarter fraud decreased to 14.1% from 16.5% in Q1 2015. Publishers fared better with fraudulent impressions at 3.7% where ad networks and exchanges had close to 4 times more fraudulent traffic at 14.1%. Overall video ads perform better than display in both viewability (37.2%) and fraud rates (11.6%) in Q2 2105. While the industry has made improvements in non-human fraudulent traffic, it’s slow to improve in viewability.

Integral also offers the “TRue Advertising Quality (TRAQ)” score using a mix of metrics including fraud, viewability, ad clutter, brand safety and professionalism. Display averaged a score of 604 on a scale of 1,000 with publishers scoring a 656 and ad networks and exchanges scoring a 584.

Advertising | Industry-Research

Global Mobile Advertising Revenue 2014

August 14, 2015 Research Team—DCN

The Interactive Advertising Bureau (IAB) and its Mobile Marketing Center of Excellence, IAB Europe, and IHS Technology report that global figures for mobile advertising revenue which rose 64.8% to $31.9bn (€23.9bn) in 2014 from $19.3bn (€14.6bn) in 2013. They find that this growth is being driven by continued shifts in consumer usage patterns and industry innovations.

According to the IAB, the global figure of $31.9bn (€23.9bn) for 2014 is made up of these regional shares:

North America: 44.9% ($14.318m / €10,781m)
Asia-Pacific: 36.5% ($11.627m / €8,754m)
Europe: 16.6% ($5.306m / €3,995m)
Middle East and Africa: 1.2% ($379m / €286m)
Latin America: 0.8% ($239m / €180m)

Among the key findings:

Growth year-over-year was led by North America, which saw a 76.8% leap over the 2013 figures.
All regions grew by more than 50%.
Mobile display continues to show the highest growth at 88.1%, overtaking search as the dominant segment.
Search represented 46.1% of the total global mobile advertising revenue in 2014.
Display represented 47.4% of the total global mobile advertising revenue in 2014 at $15.1bn (€11.4bn).
Mobile search followed, up 55.%, taking a 46.1% share.

Advertising | Industry-Research

Ad Blocking Predicted to Cost Ad Industry $21.8 billion in 2015

August 12, 2015 DCN

Use of ad blocking software is gaining rapid adoption with 198 million monthly active users worldwide reports The Cost of Ad Blocking published by PageFair and Adobe. Global usage of ad blocking software increased 41% from 2Q14 to 2Q15. In the U.S. alone, ad blocking usage expanded to 48 million monthly unique users, a growth of 48%, presenting approximately 16% of the U.S. online population.

What does this mean for the future of the Internet publishing and advertising? The ad industry anticipates losing $21.8 billion globally in blocked revenue this year with $10.7 billion in the U.S. alone. This figure is set to almost double by 2016 when the global cost of ad-blocking is expected to reach $41.4 billion.

What’s driving adoption rates? User adoption of Google Chrome and its easy installation of ad blocking extensions grew 51% from 44 million monthly active users in 2Q 2013 to 126 million in 2Q 2015. Further, while mobile only accounts for 1.6% of ad blocked traffic, new operating systems such as Apple’s iOS9 will make it easier for consumers to block mobile ad traffic. It’s the first time app Apple will allow app makers to develop ad blocking software for iPhones and iPads. Usage of ad blocking on mobile is expected to increase exponentially.

What do these ad blockers look like? Consistent with prior research, ad block users are typically, young, technically savvy, and more likely to be male.

Why are users blocking ads? PageFair and Adobe also surveyed 400 internet users asking what would drive them to use ad blocking software. The top two responses reported “misuse of personal information” (51%) and “an increase in the number of ads” (41%).

Advertising | Perspectives | Revenue

Is Programmatic Part of a Winning Strategy?

August 6, 2015 Mark Glaser, Founder and Publisher – MediaShift

There is always a sense of inevitability when it comes to robots and automation. Of course, factories are automated and these days, robot write basic news stories. We expect some kind of self-driving car to hit the road in the not-so-distant future. But what about online ad sales? Should that process be completely automated or is there still a need for one-on-one custom attention for each sale?

While the trend among larger publishers has been toward more programmatic ad sales, it was recently reported that some are bucking the trend. As the Wall Street Journal’s Mike Shields wrote, Vox, Mic and Refinery29 — “the much hyped cadre of venture-backed, web-born, and millennially-inclined publishers,” are largely shunning programatic ads. Perhaps the most firm stance against it has come from Mic’s chief executive, Chris Altchek, who said the site doesn’t use any programmatic advertising at all. Whereas Vox has actually made moves toward embracing programmatic, albeit carefully.

The backlash against programmatic and ad tech is based upon the sentiment that it degrades the user experience. When prominent publishers need multiple ad tech providers to accomplish different tasks, that “mass of tech” slows the speed at which web pages load. Frustrated users then do what seems to be a logical solution: install an ad blocker. And to some publishers, that makes it seem a lot like ad technology companies drive a publisher’s profits away. The fact is that each media outlet needs to carefully consider the potential revenue programmatic can generate versus the possible lost advertising as a result of poor user experience.

Push for Branded Content
“Once you get to a certain size as a publisher, in order for ad tech to make sense it has got to move the needle,” said Scott Grimes, the chief executive of the media publisher Woven Digital. “Just an incremental thousand bucks is just not worth it.”

Instead of relying on ad technology, newer web publishers are looking more to create branded content specifically for their sites. BuzzFeed has been the ring-leader of this trend. Vox, meanwhile, has Chorus for Advertisers, which uses its Chorus insights platform to enable brands to create and distribute the kind of content that works with Vox’s editorial voice.

But Vox Media’s vice president of global revenue and partnerships, Mike Hadgis, admitted this is just one stream of advertising revenue. “Native advertising/branded content, premium editorial, custom high-impact units, video, mobile, social…are all important solutions for our marketing partners and give us a well-rounded portfolio of advertising revenue,” he told Capital New York.

Difficult to Change the Trajectory
But it’s hard to say if a few holdouts will really slow programmatic’s march toward a permanent niche in the industry. Industry insiders speculate that the whims of a few publishers can’t change the general trajectory of the ad technology landscape even if they might have some influence. What they have that other publishers do not is venture capital, which gives them the financial leverage to take such a position on advertising.

Seth Rogin, chief revenue officer at Mashable, told the WSJ that being anti-programmatic is another way of saying one doesn’t understand programmatic. “You start to sound like the old uncle who complained that they’d never go on Twitter.”

And the overall numbers back him up: Programmatic advertising comprised 20% of all Internet advertising revenues last year, worth $49.5 billion, according IAB’s first-ever report on programmatic revenues. That said, ad tech revenues represented approximately 55% of the programmatic revenue pie in 2014 with approximately 45% of programmatic revenue finding its way to publishers.

However, whether you consider programmatic ads as useful and necessary or think that that programmatic is going to take away from the experience of a site, the important thing to remember is that a tool is only useful when it’s used the right way. The trick, then, is to figure out just the “right way” to leverage ad automation so that it supports your site and pleases your audience.

Advertising | Industry-Research | Video

Online Video is the Fastest-growing Category of Internet Advertising

August 5, 2015 DCN

Online video advertising revenue is estimated to reach 16.2 billion worldwide with the US by far the largest market at $8.5 billion reports ZenithOptimedia’s Online Video Forecasts 2015.

Given the rapid penetration of smartphones and tablets, worldwide total video consumption is expected to increase by 20% in the coming year from 48.1 minutes per day this year to 57.6 minutes per day in 2016. Mobile devices are expected to be the main platform for viewing online videos growing from 46.8% (22.5 minutes per day) share of time spent this year to 52.7% (30.4 minutes per day) in 2016.

Online video viewing globally skews to young adults and is slightly more male (14.2% males 18-24 and 13.8% males 25-34 vs. 8.5% females 18-24 and 8.4% females 25-34) based on comScore (Video Metrix, September 2014). Understanding online video consumption habits and the video publishing infrastructure is important to marketers in identifying the right short- and long-form advertising and branding opportunities for their target audience.

Advertising | Perspectives

Ad Blocking: A Problem in Need of a Creative Solution

July 29, 2015 DCN

Instead of Blocking the Blockers, Let’s Focus on Making Advertising Better

The adoption of ad blockers is climbing at an alarming rate, with usage doubling since 2013. The reason cited for this steep incline is that people hate advertising. Wrong. Sure, people hate irrelevant, intrusive and offensive advertising, but all you have to do is ask someone to tell you about their favorite ads and you’ll hear a very different story.

It’s true that we are moving into a period in which many more direct-to-consumer content offerings will become available, but it’s also unrealistic to think that 100% of consumers are going to pay for ad-free content services. Ultimately, content will need to be paid for by someone and even the direct-to-consumer offerings will likely contain some level of advertising, whether it be dynamically inserted or sponsorship integrations. So let’s stop entertaining the notion that advertising is going to go away and focus instead on improving the advertising experience — both its relevancy and targeting — so that, together with the content experience, we can truly delight and not alienate audiences.

A medium with a message

There was a time (and it still may be the case) that people were as excited about the commercials as they were about the Super Bowl itself. The fact is that strong, relevant, entertaining commercials have always done well. Great creative gets viewed, discussed, shared, talked about and remembered for years to come. In a digital world, the potential for creative to make a significant impact is even more possible. Unfortunately, that’s not what most people are seeing now… (Continue Reading on AdAge)

Advertising | Industry-Research

U.S. Programmatic Display Ad Revenues Totaled $10.1 Billion in 2014

July 21, 2015 Research Team—DCN

Programmatic buying and selling of online display-related advertising generated $10.1 billion in 2014, comprising 20% of last year’s overall internet advertising revenues ($49.5 billion) according to the first-ever IAB Programmatic Revenue Report, prepared by PwC US. This figure represents approximately 52% of display-related advertising in 2014 ($19.6 billion), while non-programmatic display-related revenues accounted for the remaining 48% at $9.4 billion.

As David Silverman, Emerging Company Services Practice Co-Leader of PwC, points out in the report, “over the last several years, publishers and advertisers have continued to adopt programmatic buying and selling of digital inventory into their media strategies; however, within the complex programmatic ecosystem there has been a lack of consensus around the definition of programmatic and its associated types and formats and the size of the programmatic market in comparison with the overall internet advertising market.”

For the purpose of this study, programmatic was defined, but not universally accepted, as “machine based buying and selling of digital media including auction based methods like RTB and private marketplaces as well as the automation of direct sales, sometimes called programmatic direct.”

Highlights from the IAB report include:

Open auctions made up approximately 70% of the programmatic revenue in 2014.
Display banner ads made up approximately 80% of programmatic revenues in 2014, but the findings demonstrate that mobile and video formats will take more of advertiser and publisher budgets and inventory over time
Ad tech revenues represented approximately 55% of the programmatic revenue pie in 2014 and approximately 45% of programmatic revenues ultimately found its way to the publishers.
The majority of programmatic inventory was bought and sold through Open Auctions, but the report predicts a shift to other types (i.e. Private Auction, Unreserved Fixed Rate or Automated Guaranteed) in the next few years.
Programmatic revenues from ad tech outweighed those from publishers in 2014.
Programmatic buying and selling are moving forward; however, sizing the programmatic industry will continue to be a challenge until standardization and increased transparency become more apparent.

Advertising | Perspectives

The Age of (Atypical) Advertising Alliances

July 9, 2015 Mark Glaser, Founder and Publisher – MediaShift

Coopetition. It’s a term long familiar in Silicon Valley, but only now making the rounds in the advertising world. It means that companies known for battling it out in the marketplace sometimes have to work together for the greater good for both companies. (It’s also a founding principle of DCN.)

The result? Unusual advertising alliances are shaking up the $531 billion global advertising business. It might seem bewildering, but given the trends taking place in advertising and technology and predictions for the future, it may be what story-driven marketing needs. Alliances this year include the Pangea group of publishers, the Truffle Pig ad agency, and even a video deal between Vice, Bank of America and Pinterest.

Vice Video Series
At the recent Cannes Lions International Festival of Creativity, Vice CEO Shane Smith had observers buzzing when he announced that Vice, Bank of America and Pinterest were joining forces to market “The Business of Life.” It’s a digital video series produced by Vice that launched earlier this year. With Bank of America backing it up, Vice can further its aim of providing better personal finance education, while having the Bank of America brand and knowledge to back it up. Bank of America can also leverage the Vice brand, including its storytelling ability, authority in the video world, and hip factor with the millennial demographic.

Pinterest, meanwhile, can roll in valuable insight from its new division, Pinsight Labs, into the collaboration. In the Labs, “a team of strategists analyze data from its platform to find insights for brands and other partners to help inform their marketing efforts,” Jack Marshall and Suzanne Vranica wrote in the Wall Street Journal. Put another way, Bank of America can look deeply into Labs to see what financial topics might interest millennials most—because Pinterest too has a strong hold over the much-coveted millennial crowd.

“You have new alliances forming. You can see where [the industry is] going,” Smith said at Cannes. “You can see it going to a more bespoke, case-by-case, platform, content, brand kind of thing.”

Truffle Pig Collaboration
According to Smith, the new deal is not much different than the other recent unusual advertising alliance that’s taken the marketing world by storm: Truffle Pig.

Truffle Pig is a collaboration among the advertising giant WPP, DailyMail and Snapchat. Much like the real-life truffle hog it’s named for, the new advertising agency is meant to sniff out and market content that only a true truffle pig can. (A truffle pig, by the way, has an excellent sense of smell that helps it discover truffles. Yum.) The agency will create both online and print sponsored content, including vertical video that’s meant to be shared on social media, and presumably, viewed on mobile. It makes sense given that a new report from Ooyala has found that mobile viewing today accounts for 42% of all online viewing—it’s grown more than 367% over two years. Forty-five percent of millennials have also reported preferring to view video on a mobile device rather than a computer.

Truffle Pig will test its concept first on DailyMail.com, Elite Daily and Snapchat but plans on extending it to any new digital clients. Alex Jutkowitz, head of Group SJR, which will head the Truffle Pig agency, summed up the premise behind the effort at a press conference at Cannes: “Great content is not just about creating it, but having platforms for it… Engaging millennials and having distribution is key. Snapchat is where the millennial fish are and that’s where we are going.”

Pangea Alliance
And earlier this year in March, the Guardian, CNN International, the Financial Times, Reuters and The Economist announced that they would form the Pangea alliance, to allow marketers to use programmatic advertising and pool data from their individual audiences.

“The essence behind this is it will give us a greater degree of strategic control over the direction of our business. Five heads are much better than the Guardian’s on its own,” the Guardian’s Tim Gentry (and leader of Pangaea) told the Wall Street Journal.

And that really sums up the idea of coopetition: strength in numbers.

Advertising | Perspectives

Ad blocking: Why now?

July 6, 2015 DCN

Users say that they’re blocking ads because of the annoyance. But ad blocking has only recently started to catch on, and ad annoyance has been there since the beginning. Distracting blinky ads, slow page load times, security concerns, the whole enchilada. For many users, web ads in the days of dial-up connections and pop-up windows were even more annoying than the web ads of today.

The ease of use of ad blocking hasn’t changed either. Free, convenient ad blockers have been available for more than a decade. But WebWasher, AdSubtract and others earned good reviews, then failed to catch on.

Today, though, ad blocking is a thing. And that’s not so much because new reasons to block ads are appearing, but because reasons not to block are going away.

The red line, retargeting, is a query for a form of targeted advertising that is easily visible to users—ads that users can see following them around. [View full report in Google Trends]
The blue line is a query for “how to block ads.” Users looking for a solution.

Why does the blue line start to take off only after the red line? Web ads were just as annoying before users started to see how they were targeted. What is it about targeted ads that changed the decision to block? Why was the 2010 What They Know series in the Wall Street Journal such a big deal?

Is better targeting causing blocking, or is it just an accidental correlation? Survey data suggests that users react differently to ads depending on how accurately they are targeted. In one study, 66% of adult Americans said they do not want marketers to tailor advertisements to their interests. And when the researchers explained how adtech can target ads to them, the percentage saying they don’t want targeting went up—as high as 80%.

If you don’t believe academic studies, believe the company with the best marketing in the world. Would Apple really put this copy on the Safari browser page…

The web pages you visit often leave cookies from third-party websites. These cookies can be used to track where you go on the web, target you with ads, or create a profile of your online activities. Safari was the first browser to block these cookies by default.

…if it didn’t resonate with users? If users like being tracked, Safari could easily feature extra tracking, to help users connect and share with brands.

Are ad blocker users irrationally squicked-out by targeting that’s actually good for them? And are users just being dishonest by using web content without accepting the ads?

Fair is fair: advertising and the reciprocity norm
It turns out that ad blocker users are pretty good at applied behavioral economics. If we understand what the basic bargain behind advertising is, we can understand why people put up with advertising in some media but block it in others.

Gavin Dunaway at AdMonsters writes:

The transaction between most Internet content providers and users is something I’ve always referred to as the “unspoken handshake” – users pay for their content consumption with personal data as well as by allowing advertisers the opportunity to reach them.

That’s one kind of fair exchange. It’s the lead generation bargain. Fill out this form to WATCH OUR FREE WEBINAR! People choose to reveal personal info all the time, every time they enter a sweepstakes or swipe a supermarket loyalty card.

But are users passively choosing to share data with unknown third parties? (Quick, name three companies that ran trackers on the last news story you read, and what they do with your data.) Studies suggest otherwise.

But advertising isn’t just about the lead generation bargain. Lead generation can send a special offer to buy a product for a lower price…

…but it can’t build a brand that people will be happy to pay a higher price for. That’s where signaling comes in.

Clearly lead generation is not the point of high-value old-school ad media such as TV, radio, and print. Nobody gives up any personal data to watch Knight Rider on broadcast TV, or buy a copy of the newspaper out of a vending machine. But that impersonal advertising is where the money is. Print is trending down but still more valuable than either web or mobile on a per user minute basis.

The bargain that matters in advertising’s big leagues is the exchange of signal for a user’s attention. An ad can be a public, credible, costly display of the advertiser’s intentions in the market. When an ad fails to send a signal, as is the case when it’s targeted to a user who can’t tell if it’s part of a big campaign or just the digital version of a cold call, the ad doesn’t hold up its end of the signal-for-attention bargain, and the user starts looking for an opportunity to block it.

One way to look at the blocking problem is to accuse ad blocker users of violating a reciprocity norm, by entering into an implied lead generation bargain and then failing to hold up their end. But the other, more valuable deal—the signal-for-attention bargain—is the one that advertisers broke first.

How to stick to both bargains?
One important direction is to make the lead generation bargain explicit, not sneaky. Instead of using malware-like third-party tracking techniques, make it easier for users to control how they share their info.

The other half is of the solution is to restore the signal-for-attention bargain. Some of the most promising new work from web browser developers holds the promise of changing the web advertising game to work more like signal-carrying print and broadcast media. Firefox and Apple Safari have tracking protection functionality in progress, and Microsoft Internet Explorer has had it for a while.

Tracking protection can displace ad blockers by filling users’ immediate need to block the low-value targeted ads that follow them, while at the same time leaving the door open for signal-carrying advertising that works better for brands and pays better for publishers.

Web publishers today have a choice: get dragged into a no-win game of blocking vs. anti-blocking, or change the conversation and offer users an alternative that works better for everyone. Instead of just lecturing users to turn off your ad blocker, it’s time to encourage them to enable tracking protection, and turn on the signal.

Don Marti is a contributor of code and documentation to the aloodo.org project, a low-friction way for sites and brands to reclaim the value of online advertising from fraud and ad blocking. He is the former editor ofLinux Journal. Don is the subject of an out-of-date Wikipedia article, which he will not edit himself, but wishes that someone would.