At last week’s IAB MIXX Conference, there was a session entitled, “The Economic Impact of Ad Blocking: Exploring the Human Costs of an Industry Problem.” IAB President and CEO Randall Rothenberg called on three independent publishers to share how their livelihoods are being damaged by “ad-blocking profiteers.”

Now, most video marketers may think Rothenberg is using some fighting words – because he is. He said, “Ad blocking is the latest crisis du jour, a potentially existential threat to the industry.” Adding that “Without advertising, digital content and services either will vanish, or the cost for their production and distribution will come directly from consumers' wallets.”

34% of U.S. Adults Use Ad Blocking Software

Rothenberg went on to state that some websites, particularly those aimed at millennials were already losing up to 40% of their ad revenue directly due to ad blocking practices. And here are some additional statistics from PageFair and Adobe’s 2015 Ad Blocking Report, “The Cost of Ad Blocking,” which was updated recently:

  • There are 198 million active ad blocking users around the world.
  • Ad blocking grew by 41% globally in the last 12 months.
  • Ad blocking grew by 48% YOY to reach 45 million active users in 12 months thru June 2015.
  • Ad blocking is estimated to cost publishers $22 billion during 2015.

Ad_Block_STATS2

The Effect of Ad Blocking on Video Creators

But as video marketers know all too well, statistics don’t tell compelling stories the way that people can. So, Rothenberg invited Rick Jaworski, the CEO of JoyofBaking.com, and Sandy Pelland, the CEO and founder of MomLifeTV.com

The IAB has also posted videos from these independent publishers. Here’s the one by Stephanie Jaworski. Her Joy of Baking channel on YouTube has more than 94 million views and over 580,000 subscribers.

Yesterday, I interviewed Rick Jaworski on the subject of ad blocking, and the economic impact it has had on their video content:

Greg Jarboe: Tell us about your business. What's your backstory?

Rick Jaworski: My wife and I have been running joyofbaking.com since 1997 and the Joy of Baking (JoyofBaking1) YouTube channel since 2011. We are one of the few content creators that have a presence on both the web and YouTube as we started on the web first. We generate 100% of our revenues though advertising on our site and channel. Our website receives over 1.3 M visits per month, and our YouTube channel has 580K subscribers, 94M total views and is running at about 2.2M views per month. We teach you how to bake anything from the simplest muffin to the most difficult French croissant and everything in between and we do this all for free. Last January we won 4 Taste Awards in Hollywood for our video content which has never been done before in a single year.

GJ: How does ad blocking threaten your business?

RI: Since 100% of our revenue comes from advertising, when ads are blocked we earn nothing. If blocking becomes a major percentage of our views we will be unable to provide the high level of content our audience has come to expect.

GJ: What would you think the industry should do about ad blocking?

RI: In my view the reason ad blocking has become popular is because ads have become too intrusive. As an industry we need to be cognizant of this and look seriously at the type of ads the industry is running and tone down the amount of intrusion.

When Installing a Paywall isn't an Option

The IAB has also posted a video of Sandy Pelland of MomLifeTV.com, and how ad blocking software has a detrimental effect on small digital publishers:

I also interviewed Sandy, about the challenges of monetizing via ad revenue:

Greg Jarboe: Tell us about your business. What's your backstory?

Sandy Pelland: MomLifeTV.com is the lifestyle network for moms, designed to inspire at every life stage of parenting. We provide education, information and entertainment with a primary focus on video. Our goal is to inspire through the power of storytelling. As a holistic brand, I place blocks on ads for unhealthy products, like junk food. It pains me when some of these ads slip through, but as a small publisher, it’s nearly impossible to block them all. I share the annoyance of my audience.

GJ: How does ad blocking threaten your business?

SP: As a publisher, I’m reliant on ad revenue to grow my business. MomLifeTV is a valued resource and platform for moms, with a mission to give them an authentic voice. Installing a paywall isn’t the right option for my audience and ads allow me to keep my site running. On the surface, ad blocking tools appear to be a great resource for consumers, but in the end, the consumer loses if content is no longer free, or if smaller publishers disappear. This is a critical issue for us.

Ads: The Only Income For Many Small Video Publishers

Users deserve a great experience when visiting a site. Everyone knows that screen takeovers are annoying, yet more sites have them than ever before. Ads are more intrusive with self-starting videos, and viewed products that endlessly follow you on other pages and sites. Frequency caps are needed.

Many consumers don’t realize that online advertising supports a whole ecosystem: large and small publishers, ad and media agencies, as well as brands. It’s about real people. It’s about providing jobs for a thriving economy. When you block ads everyone is affected. Consumers need reminding that “free content” requires advertising.

Well, that's what a couple of independent publishers think about ad blocking. Let us know what you think in the comments section below.