Ad-pocalypse

I continue to catch up on some IBDs, here is a summary of Apple ad-blocking article from Friday’s paper.

With IOS 9, you can download an app to pair with Safari to block (some) ads while browsing (but not within other apps).

A report shows that 16% of US online population blocked web ads in Q2 2015. Gaming, social networking and tech-related sites are most affected by blockers (says report). Ad blockers led to lost revs of $5.8 billion in US last year. Estimates it could pose a global cost of $$21B this year and $41B in 2016. (But I say that is also saving someone that same amount of money). Says ad blocking “still underdeveloped”.

But, on mobile, good ad blocking can improve the browsing experience. An advertising CEO does admit there has been some abuse.

Ad blocking used on computer browsers since 2002. IOS 9 may be a game changer because so easy to install.

In Q2 40% of mobile ad blocking came from Firefox (with an extension installed). In June, 16% of Firefox users on Android used ad blocking.

Mobile Safari is 52% of mobile browsing and is expected to reach the 16% rate says one analyst. IOS will block banner and video ads (I hate auto-play video!). Various independent ad blockers for Safari are expected soon.

This will cause more innovation to create ads that are not annoying says CEO of Spartz Media. NBC won’t allow you to view their videos if you enable ad blocking. Washington Post will bug you to buy a subscription.

On to Criteo:
Stock got whacked on initial news, down 39% from July high. But starting moving up on 9/9 when Apple announce IOS9 (cute IOS 9 on 9/9). Then moved up 19% over next 6 days.
http://stockcharts.com/freecharts/gallery.html?crto
CRTO embeds cookies for visits to almost 50% of largest retail and travel web sites (nice piece of the pie). CRTO gets paid for a click and more if it results in a buy. An analyst said ad-blocker could hurt CRTO (duh).

Most ad revenue from mobile actually comes from within apps, not browsing. People spend most of time in apps (88%) . (I do not understand the draw of candy crush!).

Poll says 54% people “somewhat” or “very likely” to install blocker. But mobile “power users were less ready to jump on board. (as power users with lots of transactions, they may be hoping to see ads for good deals). Those most likely to install, just used phone for the basics (phone calls, text, check email, etc) Ad blocking not expected to change landscape for social media sites FB, TWTR, LNKD, where ads are already fashioned to look like other content like news feeds. (so I guess ad blocks get tricked?) Google could be hurt due to its heavy reliance on ads (90% of revs). (Hmmm, if Google isn’t crashing, why is CRTO).

(other ad blockers and cookie blockers if you are interested: AdBlocker Plus, Ghostery, Trust-GoAd Detector and Shine)

Ad users least want to see:
Display ads with audio (78%)
Website “popovers” (83%) according to PageFair.

Ad-blocking does not block all ads (as we have experienced). AdBlocker Plus allows “non-intrusive” ads including most “native ads” that blend with web-sites content. If you conform to AdBlockers “good user experience” policy you can pay to get whitelisted! (So that’s how they make money).

So maybe CRTO is not as damaged as we think. Maybe if ads get “nicer” fewer people will block. If they can’t visit the sites they like for free, maybe there is less blocking.

P.

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