Report claiming ad blocking has cost $22B in losses this year may be off

Dive Brief:

PageFair and Adobe released a report that ad blocking technology has cost publishers $22 billion so far in 2015, a figure that has been widely quoted and received a lot of industry attention.
A BuzzFeed article attempted to throw some cold water on the figure pointing out the extrapolation that led to the multi-billion dollar number ignored basic supply and demand, inflating the figure.
The reasoning behind the article’s premise was the researchers simply counted the value of the unserved ads without taking into account if those ads were actually in the marketplace, the extra volume would drive the overall costs of those ads down.

Dive Insight:

The 2015 Ad Blocking Report by PageFair and Adobe released last month got a lot of attention from industry and major media, including Marketing Dive, for one particular data point. The report declared that ad blocking technology had already cost publishers almost $22 billion so far in 2015. A striking number, and a figure that sent ripples of concern across digital publishers, marketers and ad platforms alike. Yesterday an article published by BuzzFeed attempted to ease those concerns a bit by laying out a scenario where the losses were overstated.

The argument goes that since “blocked” ads are really simply not served, advertisers never pay for them and still have that budget to spend on other ads. Basically in this case demand in the form of digital ad budgets remained the same while the supply, the inventory of ads, was reduced by the ads not served driving up demand and prices. The article pointed out if all those ads were not blocked, inventory wouldn’t be reduced and the overall value all ads would drop based on supply and demand.

Whatever the cost of ad blocking software, it remains a concern for publishers and marketers alike and there’s a new ad blocking concern looming in Apple’s iOS 9, which will allow for ad blocking extensions in the mobile version of the Safari browser. So far mobile has been one channel that is relatively free of ad-blocking tech, but that is about to change at least for Apple users.