Why profiting from mobile growth is so difficult – and how content can conquer the format
When Apple first announced that they were to make a mobile ad blocker available on the App Store, there was widespread worry among publishers that it might kill online advertising revenues stone dead.
The ad blocker desktop battle between publishers, ad tech providers and advertisers has raged for years. But until 2015, such a war had not formally extended to mobile.
In the aftermath of the announcement, a few rudimentary back-of-a-beer-mat calculations drew some pretty alarming conclusions.
Mobile had been rapidly eating into desktop’s share of the market ever since Steve Jobs stood on a stage in San Francisco to launch the iPhone in 2007. Albeit slower than predicted in preceding years, the platform was now rapidly approaching parity.
Market shares
The most fearful extrapolated that if Apple laid claim to half of this mobile market and if the uptake on the new (free) app was high, more than 25% could drop off the publisher’s traditional advertising bottom line – virtually overnight.
Even if the numbers were smaller, it gave the mobile user a consequence-free environment within which to eliminate publisher revenue. The relationship between content provider and reader had never appeared so broken.
One worried editor tapped me on the shoulder, panicking that they were about to see a 50% drop in revenue as similar ad blockers began to emerge for Android users too.
But mysteriously, it seemed to all, once the new software rolled out, overall revenues remained virtually constant. Had mobile readers bucked the trend of widespread ad blocking as seen on desktop? Or were the existing mobile revenue figures so poor that ad blocking made little difference?
The only way is app?
Despite its market share, mobile has long struggled to effectively monetise at the same rate as desktop. Apple’s reluctance to allow the use of third party cookies, paired with few truly valuable ad formats has meant that the average CPM (cost per impression) has bottomed out – leaving the publisher with a major disparity between traffic share by platform and bottom line revenue.
Treated programmatically, the more extravagant and adventurous ad formats used to plug this gap also came with lower bid density – so ad fraud and mobile redirects were commonplace.
Other publishers assumed that the best way of monetising mobile was by building apps – either with or without a programmatic advertising ecosystem running inside.
For those hoping to offer a mobile version of their print product, this growth has largely failed to materialise – with magazine products declining too slowly for a market hole to properly develop for magazine-based apps.
The aforementioned swing to mobile was first cited in 2011, and while it took another six years to actually gain a majority, the move is unlikely to suddenly stop at current levels.
Low tech, high quality
As ad blockers have grown in sophistication, native content plug-ins have also been targeted in a remorseless fashion – leaving publishers facing a commercial conundrum.
In the face of insufficient and declining mobile revenues, could regulated direct-sold content marketing be the saviour of the format?
Where the trust between the two is sufficient enough to allow a marketer to house their content within the publisher’s CMS, the high-quality creator can see their product displayed alongside that of the premium publisher and outside the scope of an ad blocker.
The process may be stripped of automation, be far more labour intensive for both parties and see a heightened level of scrutiny placed on the publisher’s relationship with their own audience. But it could also be the growth format as more established mobile formats continue to struggle.
Ad blocker usage might suggest that the relationship between publisher and audience is at breaking point – but it may be content marketing that brings it back from the brink.
