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How Ad Blocking Impacts the Online Advertising Ecosystem

By Shailesh Shukla on April 17, 2017

Within the past year, consumers have begun to question the usefulness of online advertising and whether ads have any relevance or add anything of value to the online viewing experience. 

This has been evidenced by the ever-increasing adoption of ad blockers — browser extensions that prevent ads from being displayed. PageFair estimates the use of ad blockers grew globally by 41% over the past 12 months.

But what is the impact of ad blocking on the online advertising ecosystem? I will try to answer that in this blog post.

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Rise of ad blockers and impact on revenue

Emarketer predicts 1 of every 3 internet users will use ad blockers by 2017, more than twice the 15% that did in 2014. Adobe estimates ad blockers have globally cost advertisers $22B in revenue during 2015.

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Ad blockers are here to stay and will continue impacting the ad industry. In this post I dive deeper into the impact of ad blockers on the user experience — more specifically, why users feel the need to block ads and whether ad blockers actually improve the user experience.

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Why users are blocking ads and the industry response

Proponents claim ad blockers improve user experience. Ad blockers remove unwanted intrusive ads that interrupt the online viewing experience. Interactive Advertising Bureau (IAB) in the UK found that the main reasons people block ads include:

  • ads are often interruptive, annoying and irrelevant
  • ads slow down web performance targeted ads raise privacy concerns

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The IAB believes that ad blocking is a threat to the ad industry and is working to set industry standards to improve the user experience through the DEAL and LEAN initiatives to get publishers to clean up their sites to improve the online ad experience.

DEAL stands for Detect ad blocking through an IAB-provided script, Explain the value of ads, Ask for consumers to change behavior, and Lift restrictions or Limit access to content based on the consumer’s choice. LEAN stands for Light, Encrypted, AdChoice-supported, Non-invasive.

RELATED: “There Would Be No Ad Blockers If There Were No Shitty Ads”

Ad blocking is forcing publishers to improve the quality of ads, which is good for user experience. According to Jason Kint, CEO of Digital Content Next (DCN), “Ad blocking is a symptom of a larger consumer issue. The solution has to be a better consumer experience.”

Does ad blocking actually improve performance?

It seems logical to expect that if you block ads, there's less data for the browser to load, so performance should improve.

PubNation studied websites impacted by Adblock, a popular ad-blocking browser extension, and found average page load times decrease from 7.7 seconds to 3.6 seconds when AdBlock is installed. However, Catchpoint found that although many websites load faster with ad blockers, the same could not be said for mobile sites. In their study, 7 of the top 20 mobile sites had worse performance with ad blockers.

My company, Instart Logic, also ran a test on ad blocker impact on web performance and found that performance varies depending on the type of site. For media sites with many ads, ad blockers can help improve performance. However, for eCommerce sites that typically have few ads, performance can decrease because of ad blockers.

For example, and, both of which have minimal if any ads, had slower render times. The reason is that the ad blocker scans the web page for ads whether or not there are any, which takes a bit of time. If it finds and blocks many ads, the smaller amount of data that the browser receives more than makes up for the additional time the ad blocker introduces. If there are no ads, no time is saved so the overall load time is actually greater.

RELATED: How Publishers, Advertisers & Ad-blocking Users Benefit from Acceptable Ads

Other studies have shown ad blockers can impede a website’s normal functionality by blindly blocking any sort of pop-up without caring if it's an ad or not. Oriel, a London-based ad tech company, performed tests on the top 100 sites in the UK. They found that ad blockers often hindered normal website functions such as checking in for a flight online or tracking an eCommerce order.

Improving the online ad experience is moving in the right direction

Adobe reported that 38% of US consumers said the online ad experience has improved over the past two years and 68% said the experience was improving or not getting worse. Publishers are realizing they need to create an engaging experience for users. eMarketer and Hubspot found that consumers are more likely to engage with rich media ads, video ads and native ads than the traditional banner ads.

Native ads in particular have a higher engagement rate, as they take on the look and feel of the website and do not detract from the content. Personalization through data can make ads more relevant for a user. Adobe’s study found that when done correctly, 78% of consumers like personalized ads.

READ MORE: The Ultimate Guide to Advertorials

Ad blocking has shed light on the user experience, compelling publishers to improve the online ad experience. However, this is only a short term win. The bottom line is that consumers can't have abundant, satisfying, high-quality content without publishers being able to generate ad revenue.

This article was originally posted on Instart Logic -- a provider of a 'block the ad blocker' solution that restores digital ad revenue to premium web publishers. In the coming weeks Shailesh Shukla will continue his writing on the subject of ad blockers.