In the U.S., ad block usage has grown 48 percent from 2014 to 2015

Don’t let your site become the next victim

There is a point in every zombie movie or TV series where the audience realizes the situation is hopeless. Thousands of zombies descend on the living and cut off their escape, leaving them to flail at the heavens with inadequate weapons for a few horrifying moments before they get eaten alive.

Such is the story of ad blockers and hyper-targeted digital marketing campaigns. With the release of Apple’s iOS 9 operating system, ad blockers have gone mainstream. The zombie horde is growing, and successful digital ad strategies face an increasing threat, as do marketing agencies, content publishers and the auto dealers who run those ads.

Remember when your dealership was missing from Google listings because you lacked a digital strategy, and more competitors were whisking away your customers? It will be like that again, only worse—unless you adapt to this changing environment.

Why Ad Blockers, Why Now?
Ad blockers would not exist if consumers weren’t demanding them. Advanced targeting strategies have allowed marketing campaigns to become increasingly invasive and almost “creepy” in the past few years. These advancements are killing the user experience. Some websites struggle to load efficiently under the weight of their advertising, and mobile users do not appreciate having their monthly data eroded by animated ads and auto-play video commercials.

Apple has its own reasons for supporting ad blockers. Apple News, the iPhone’s curated news and information app, operates a display advertising network that is immune to most ad blockers in iOS 9. This allows Apple to sell ads that can be seen by iPhone users while potentially blocking those from Google.

It is important to understand the distinction here. In Apple’s world, in-app ads that they sell are acceptable, while ads that appear on websites are not. Many mobile users spend most of their time using apps, so in theory, the blockers only serve to create a walled garden that allows Apple to profit from ad sales to its users. It is as if another Google Display Network has popped up overnight.

In practice, about 16 percent of customers in the United States are using ad blockers, according to PageFair and Adobe, and under Apple’s rules, that should impact desktop search and mobile search but not mobile apps. Apple went as far as to remove one ad blocker from its App Store that was blocking in-app advertising. While the ad blocker was removed because it shared user information with a third-party server to perform its function, Apple also told its creator that blocking in-app ads was a problem for the company.

In other words, the zombie virus broke out of containment and threatened to infect the entire population of online ads, not just a subset of inconvenient ads. At this point, it is good to remember that the zombie horde, er—ad blockers—takes time to become insurmountable; it won’t happen right away.

Strategies for Survival

When faced with zombies, people must arm themselves with a weapon with suitable firepower and a vehicle with good fuel economy to get them out of town. Those who survive tend to be the ones who planned ahead or reacted fast enough to grab resources while everyone else was assessing the situation.

When faced with ad blockers, the automotive industry needs to be prepared for the possibility that their arrival will once again reshape the marketing landscape. Even if the impact is minimal, which it could be, there will be profound changes to the way people search and interact with websites in the next 24 months. Advertisers must begin to adapt their strategies if they want to stay ahead of competitors.

Survey the landscape
One tech website (Guru3D.com) is already facing an existential threat from ad blockers, with ad revenue down 50 percent year over year. If this continues, the number of online media outlets will suffer a sharp decline within three years. That means fewer places for ads to run and higher costs for placements as the supply of available advertising spots gets dwarfed by the number of advertisers looking for space.

Know where your customers come from. Pay attention to the sites and placements that bring in the highest volume of qualified traffic, measured in commercial intent traffic, calls and leads. Ask yourself what happens if one or more of those sites no longer exists.

Identify your allies
Apple’s ad blocker answers a simple question: How do you compete with Google in online advertising? Block their ads and start your own network.

This means you need to consider the possibility of buying ads from Apple, as well as Google, YouTube, Bing and Facebook. Each advertising platform will have strengths and weaknesses, and some may not be the right fit for your dealership. Hire an agency with experience or plan to spend some time in the next six months analyzing the performance of each platform so you can match platforms to the types of customers you need to reach.

You will also want to know what gets blocked. Most Google, Bing and Yahoo search ads are currently exempt from ad blockers, while display ads are almost universally blocked.

Load up on supplies
The ammunition needed is a marketing budget that can accommodate higher costs, fewer clicks for conquest campaigns and a much lower response to remarketing. Digital display advertising could become more expensive in the next 12 months, perhaps prohibitively so for select dealers, if there are fewer places showing ads and more advertisers competing over what remains.

Consider this: What happens if your digital campaigns needed 10 times the budget they do today? Would you scale back and redirect budget toward the most successful channels? Or would you stay the course and increase your bids, knowing that you could price competitors out of digital? Would you give up on digital entirely?

The right answer to this question depends on your return on investment. Analyze your traffic sources, leads, booking ratios and closing ratios. Understand how much it costs to get a customer, which channels provide the best cost per acquisition and which provide customers with the highest lifetime value. Digital should remain your best value, even if per-click prices rise, but you may need to be more selective in your spending to ensure the highest return.

Don’t go it alone
Survivors band together against zombies. Your strongest ally against the ad blockers is an experienced digital marketing agency that can analyze your performance, your strategies and your competitors. This is not the time for the cheap option; a professional agency should reduce the cost per acquisition for online advertising, while giving you the strategies today that will help you combat tough situations in the future. 

This article was published in the Winter 2016 issue of Strategy Mob.

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