Digital advertisers are going to have a hard time in the near future, says a new study from marketing firm Juniper Research, who estimates revenue loss in the billions for digital advertisers in the next 4 years due to ad-blocking.
The rise of digital advertising has occurred along with the rise of the internet, especially with the ubiquity of one of its pioneers and chief proponents, Google. Their increasing prevalence in every internet activities, along with the privacy concerns they pose, has made them more and more of a nuisance to internet users, which has raised the popularity of ad-blocking.
“Adoption is being driven by consumer concerns over mobile data usage and privacy. They are also incentivised to adopt the technology in order to reduce page load times”.
– Sam Barker, researcher at Juniper Research
Previously a common feature for web browsers (so much so that it prevents users from switching to browsers without support for it), ad-blocking has now trickled to mobile devices, often considered the new golden market for digital advertisers.
Apple leads the change with their recent inclusion of a built-in ad-blocker for iOS 9. More worryingly to advertisers, even network operators are reportedly joining the blocking game at a network level. The combined effort from hardware makers and operators will cut an approximate $27 billion of advertisers’ revenue by 2020, says Juniper Research’s “Worldwide Digital Advertising 2016-2020” paper.
While Google sounds the heaviest-hit, what does it have to do with Microsoft? As it turns out, quite a lot, considering that Bing turned a profit just recently, and that its revenue comes in large parts from ads. The search and advertising service, while far away from Google, still sits comfortably at the second place in the market, and is expected to grow healthily in the future. The growth has been attributed to Windows 10’s warm reception and the rise of the Surface line of 2-in-1 PCs, putting Bing-powered Windows into more people’s hands than ever.
Microsoft’s new Edge web browser has perhaps complicated matters by introducing extensions with the latest Windows Insider builds, with extensions already available for AdBlock and AdBlock Plus.
Microsoft’s products are not all of the equation however, with Bing also prevalent in competitors’ products like Apple’s Siri and Yahoo; in other words, Bing Ads’ revenue will not be spared from the negative impact of ad-blocking. Of course, ad companies are already looking for ways to deal with this new market change, and it will be interesting to see how Microsoft and the Bing team address this challenge in the future.Further reading: Bing Ads, Digital advertising, Microsoft