Facebook really doesn’t want you to block ads. Who can blame them? Generally social media sites are struggling to monetise the huge amounts of web traffic visiting; if a significant proportion of people blocked advertising this could eventually make social media businesses unsustainable. Given the risk ad blocking poses to the advertising industry, Facebook had to make a stand.
We’re all waiting for Twitter to be taken over, Yahoo (despite promising) has ruined Tumblr, and everyone is still scratching their heads about Microsoft’s purchase of LinkedIn for $26.2 billion as their valuation doesn’t match reality.
Despite the popularity of social media and increased internet usage, finding a successful online business model seems near impossible. The rumours say that The Guardian is losing £1 million a week and only has 7 years of life left at this rate, City AM is trying another daring business model (best of luck to them), and Buzzfeed is proving profitable but needs to navigate the fact 70% of their readers digest content from third-party sites, such as social networks.
A broad view of online profitability tells us that quickly adapting to market needs and positioning your business as a facilitator tends to reap dividends. We can see how Uber achieved this by making the private taxi business more convenient by mobile app bookings and coordinating via GPS. The music industry was slow to respond; illegally sharing files through LimeWire was once the mainstream method of gaining access to digital music online. Eventually legal methods of buying music online became available, such as the launch of the iTunes store in 2003.
In my opinion, the most successful industry that has constantly adapted to the changing media landscape is gaming. The UK is currently Europe’s second largest video game market after Germany, and estimated the 6th largest globally; worth nearly £4.2bn in consumer spend in 2015. It is the only industry that has quickly adapted to different form factors such as desktop PCs, tablets, smartphones, smart watches, and smart TVs. Games consoles have become home entertainment systems, and game copyright settings have successfully locked most people into purchasing a copy each time.
So, why am I taking you on this journey of online monetisation?
Going back to the start of this post, Facebook’s stand against ad blocking; they believe online advertisements can truly be useful. Those advertisements can alert you to when a favourite band is playing nearby or to a product/service you may genuinely find useful.
What they don’t say is that the ads you don’t deem useful are still using up your mobile contract’s data allowance. Or the disruption ads have made to Facebook’s newsfeed meaning content from your friends has been given a lesser priority compared to that ad looking for sperm donors or telling you to lose weight.
Facebook have weighed in on the online advertising debate to protect their $1 billion per quarter in advertising revenue. The question is how are we going to respond as social media users? Are we willing to have companies target us with their advertising, generalising aspects of our lives and trying to find improvements?
Facebook wants you to keep your ad blocker switched off and convince you to tell the network what sort of advertisements you would prefer to see. A nice idea, but why do I want to spend my time giving Facebook a detailed picture of my life just so they can push more advertising to me?
The debate I’ve touched upon here will continue to rage, especially as the number of bot traffic online continues to rise, questioning if ad interactions are made by humans at all. Just as the PR industry has faced its struggles and criticisms over the last decade due to digital developments, the advertising industry will now need to tackle some of its upcoming challenges.
Anyway… some thoughts from me as this blog has been neglected for the past month!