On the surface, it would appear that mobile advertising is booming. US spending jumped by two thirds last year, according to the IAB and PwC. Dig deeper however, and you’ll see a technology that is underperforming, and approaching crisis point.
As KPCB partner Mary Meeker laid out in her now-seminal Internet Trends report earlier this month, brands are still not spending enough on mobile to match the extraordinary time consumers spend there. And no wonder advertisers are wary –use of mobile ad blockers boomed 94% globally in the last year, she said.
So when Meeker, spotlighted a “call-to-arms to make better ads” in her presentation, it seemed a logical antidote. But she is wrong.
It’s a common refrain that intrusive and dragging ads are the cause behind the rise of adblockers. And the common solution too often posed to this is that by engineering “better ads” we can solve this challenge. Many think making ads more “relevant” will do the trick.
But the problems go deeper than that.
It is not that any of the troublesome ads users see are bad, per se – all those banners have some intrinsic value to someone and the content of an ad is inert, so it’s not the content’s fault.
Instead, it is the infrastructure that is at fault. Our complex tangle of networks, exchanges and pipes has created an environment where publishers often have no idea of the kind of ads served on to their pages. It’s this complacency that shoved relevancy out of the window.
Sometimes the ad networks don’t have any clue either, with some common practices in online advertising bad enough to shame the mafia. Today, when an ad impression doesn’t sell at auction for the minimum bid, it goes in to multiple auctions at lower and lower prices until it sells for something , anything.
At each step, with each re-auction, the original context of the ad, that is the rules of the page set by the publisher, are washed away as the traffic is duplicated, resulting in ads that don’t conform to the page and don’t make for a good experience.
That’s why so many people are beginning to see floating banners stuck in the middle of their page, or ads interrupting a news story by forcing open an App Store listing without any user input. And all of this auctioning, when it occurs in real-time, adds significant page load latency on top of poor quality.
So, Mary, we don’t need better ads, we need better infrastructure.
There’s a great hope to solve all of this, and it’s nothing to do with the web – in fact, it has everything to do with forgetting the web.
When people talk about mobile advertising, they are really talking about two things – mobile web advertising, and mobile app advertising. One of these accounts for 85% of the time users spend on mobile phones and almost three quarters of all mobile ad spending. The other is the web.
When PageFair reports that 22% of all smartphone users, are running mobile ad blockers, as Meeker cited, that is a mobile web problem, not a mobile problem – with the vast majority of these individuals located in China and running open Android browsers. In the US, only two percent of iPhone owners are reckoned to have downloaded content-blocking plugins – and they only block ads on the web, not in apps.
In short, web ads are the smallest part of the opportunity, the biggest part of the problem and are doing nothing to raise the horizon for mobile advertising generally.
Apps don’t suffer from these sorts of problems quite as much. In-app ad inventory is far more tightly controlled. Because the rules are set at the system level, you don’t tend to find floating banners obscuring your content, or naughty banners that auto-link elsewhere. Apps already boast some of the features that web ad blocking extensions do, plus others – such as native access to sensors that can give ads the extra targeting context they need to make an impact.
This is not to say that apps may not, in the medium term, be plagued by the same problems facing the mobile web. If we are to retain the app environment as a refuge from the mobile web’s dirty practice, we must be diligent to safeguard against its cheapening.
The mobile web is already playing a smaller and smaller role, proportionally, in the future of mobile advertising, and that’s thanks, in no small part, to the mess its infrastructure has got us in to. If the ecosystem cannot exert some restraint, it may be time to let the mobile web go.