Ad Blocking: Threats and opportunities for SMBs

In 2017 alone it was estimated that publishers lost $15.8 billion in advertising revenue due to ad blocking technology.* As the popularity of solutions that actively reduce the visibility of advertising people see online grows, what does the future hold for SMBs across New Zealand wishing to grow awareness and reach new customers?

It’s no secret that advertising brings money. Unfortunately, over the last decade a large number of websites started overloading their pages with advertising. This meant that the online ad world became intrusive and irritating, which helped develop a market hungry for ad blocker products. 
Instead of being part of the unwelcome noise online and to better reach customers, SMB’s should focus on more relevant, personalised promotional strategies. People are far less likely to object to seeing adverts if they are relevant to them or their lifestyle. 

Navigating a fragmented environment 
In order to reach potential customers in an increasingly fragmented digital environment, SMB’s need to be thinking about how they make their content meaningful, personalised and relevant from the outset. That means gaining in-depth insights into their customers including the brands they love, the places they go, even to the sports team they support. It’s all relevant. SMB’s need to begin their approach by asking “where do I get information about customers that I can use to personalise their experience and use as an input to my digital strategy?”
The advent of ad blocking technology should not be feared by local businesses, it actually presents real opportunities for savvy owners and managers that know how to leverage customer data and insights to stand out from the crowd. Because, if everything else is blocked and only they are getting through, their business or brand is going to get more visibility.

Understand your audience
For a SMB to make their promotional campaigns more relevant and personalised, they need to properly understand their customer base through segmentation. Unfortunately, many businesses still segment by age, gender, income, etc. — demographic data that isn’t relevant anymore. It doesn’t matter if people are 16 or 65, they may still like the same Facebook pages. SMB’s need to think again about how they segment their audience. They need to think about what data they are using to identify if a certain person falls into that segment or not. They cannot rely on a single source for data anymore.

Ad blockers are businesses too
It is important to remember that many ad blockers are commercially driven and have their own business model as well. Not all of the solutions on the market are on some moral crusade to protect the consumer from unwelcome content. Many ad blockers offer a whitelisting service that means if a retailer pays enough money, they permit their ad to get through. 

Be part of the conversation
New Zealand SMB’s should not automatically be afraid of ad blocking. If they provide content that the audience wants to consume, then the audience is far less likely to block them. It’s important to remember that online advertising is not the only way to get content to a relevant audience. 
A huge trend, especially with Generation Z, is for using messenger apps, such as WhatsApp or Facebook Messenger. Consumer facing SMB’s can reach out to their audiences through these apps. Normally the messenger app asks when someone is creating their account what their hobbies are, etc. Based on that, the user agrees to receive third-party ads as long as they are relevant to them. Those ads do not have to be in the form of a banner. 
As an example, when a user is chatting with their friend about a shirt they saw in a shopping mall, using artificial intelligence, the bot can then deliver a message to them in that chat telling them that it can see what they are talking about and ask them whether they have heard that they have a sale on a similar item in a certain online store. The bot is adding something that is relevant to both the user and the chat. The bot recommends a product not only from what it knows about that person from their social profile but also based on the context of the discussion they are having at that precise moment in time.

Build a community, not just a brand
In order to engage with customers, it is no longer enough to simply promote or build a brand; rather SMB’s should be focusing on how they can build their own online community. People respond positively when they feel there is a sense of community around a brand online — reviews of products and services, social media share buttons, forums, a blog with the possibility to add comments are especially important. 
The ultimate goal for all SMB’s today should be to create a personalised online (and offline) experience for consumers. The result of these efforts can lead to happy and engaged customers, who can act as brand advocates in their own right. After all, there is no ad blocker in the world that can filter that out.

Article by Wayne Jasek, director of APAC Operations for Kentico. He specialises in helping SMB’s deliver executional online experiences that turn visitors into customers.  

*References: https://www.mediapost.com/publications/article/308814/us-publishers-158b-annual-revenue-lost-to-ad.html