Working From Home Spurs Ad Block Rates to Rise

Ad blocking could cost publishers $54 billion in annual ad revenue

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Mobile and desktop ad-block rates are experiencing a gradual uptick, increasing by 11% in 2023 from 2021, according to ad-filtering tech firm Eyeo and its 2023 Ad-Filtering Report.

Buoyed by the work-from-home trend, the rate of ad blocking on desktops in the U.S. reached 27% by the end of the second quarter this year, according to the report by Eyeo. The ad-blocking rate on mobile phones is 22%.

The report forecasts that publishers around the world will lose $54 billion in ad revenue due to ad blocking in 2024—based on global ad spend figures—representing roughly 8% of total global ad spend. The report suggests the cost would be up to $116 billion if ad-filtering solutions didn’t exist.

Before 2021, rates of ad blockers leveled off after publishers introduced tactics like urging people to deactivate ad blockers to access content or adopting Acceptable Ads standards, which regulate criteria like ad size in order to show people lighter ads.

The increased adoption of mobile devices globally combined with people replicating their ad-blocking experiences from desktop to mobile has spiked the trend on mobile devices, said Jan Wittek, chief revenue officer, Eyeo. There’s a total of 912 million active ad-blocking users worldwide across mobile and desktop.

Despite receiving higher traffic, mobile pages tend to be less lucrative than desktop due to lower revenue per page (RPM). However, the continued shift in traffic from desktop to mobile means that Eyeo anticipates a rise in ad blockers on mobile devices. As of October 2023, the global split among mobile and desktop market share is at 53% and 45.5% respectively, according to Statcounter.

“Safari doesn’t have third-party cookies and obviously there’s third-party cookie demise happening,” said Ben Morrisroe, head of growth at ad-tech firm Publift. “There’s definitely a squeeze on publishers being able to monetize the users as well as we have been able to so far.”

Meanwhile, data from App Annie found that downloads of the top five dedicated ad-blocking apps in the U.S. saw a 17% increase from the second quarter of 2023 to the third quarter, rising from 115,000 to 134,000 across the Google Play app store.

Recouping revenue and gating content

In the last year, Raptive—which runs ad sales for titles like MacRumors and Stereogum—saw ad blocking rates average across its publishers of between 20% and 30% of users, according to chief strategy officer Paul Bannister.

“It’s a pretty big number,” he said.

Raptive works with Eyeo’s Blockthrough solution to tap into the Acceptable Ads program run by the Acceptable Ads Committee, which serve ads that fit specific criteria to people who have chosen to block them. The number of people opting into Acceptable Ads has increased by 42% between the first quarter of 2022 and the second quarter of 2023, crossing the 300 million mark, the company said.

As such, Raptive has been able to deliver 2.7 billion ad impressions to ad blockers, facilitated by Blockthrough, according to estimates from Eyeo. Raptive has recouped millions of dollars in the past.

Elsewhere, Morrisroe said that publishing sites have seen an annual recovery of 12-15% in ad revenue by using Acceptable Ads.

Niche publishers, particularly those with a direct focus like providing weather updates or running calculator sites that heavily rely on a monetization model through display ads, face a higher risk from growing ad-block rates.

“[They have] 10 direct competitors in search, and people can jump to other sites easily,” said Morrisroe.

To mitigate the risk, Morrisroe said, publishers can use models where people are rewarded with some free content in exchange for engaging with an ad, already seen in some paywalled sites and games like Candy Crush.

“The open web is going to end up being a lot more like this,” said Morrisroe. “It’s going get more complex and specific to who this user is, where are they coming from, what’s the RPM and how you optimize that.”

This article has been updated to clarify that Eyeo’s Blockthrough solution taps into the Acceptable Ads program.

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