Why online advertising is going to take a big fall
Advertising has been a major marketing tool online for years and publishers made millions out of it, not anymore. It is becoming harder than ever to advertise successfully, users ignore advertisements completely and avoid clicking on them.
Why do users ignore Advertisements
It is no surprise that users ignore advertisements completely.
I remember the time when i used to click on sponsored links a few years ago when i was new to technology, today i can confidently say that i have not clicked on an advertisement for over two years and even if i have it was probably a mistake and closed the site before it loaded. If it is only new users that follow ads, the advertising market will burst like a bubble as people get more technologically advanced.
As the users know how the websites show ads, they learn to ignore them.
The reason some users ignore ads:
They were subjected to spam in the past and have set the impression that all advertisements are spam and lead to no good. Most advertisements are annoying popups, videos, sound, flash etc.
At times the ads are legit and helpful but previous experiences take away the trust and thus users avoid clicking them.
Publishers are looking for other means of income
Most advertising companies will claim huge numbers of click rates, it is becoming increasingly harder to deliver that as people have stopped clicking on ads.
Too many publishers are showing ads and so the profit reduces and the incentive to show ads on their site is disappearing.
If you are lucky and have got a million unique visitors a month, you would probably be able to pay your hosting bills but that’s not what we are here for.
What can be done
Well, you tell me. What is the future of advertising, is it a bubble about to blast or there is so much to it that i have not taken into consideration.
I am not a data analyst but it seems as though Google is having problems within the last year which is probably why they want to expand their market with android and chrome. View data here
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11 Interesting Conversations
Though this is very true, I don’t think we will see a collapse in online advertising, just a lateral movement towards something new and less affiliated with spam. So long as people are looking for a target market to sell their goods/services, they will venture to promote that product within that market share.
That being said, I do believe the effectiveness of 125×125 button ads and the thin horizontal banners are lacking, and advertisers must see the inefficiency, however I trust sites like http://www.psdtuts.com and if I see something interesting i will click through. So maybe it is all about the trust you have for the site you are on. In the example of psdtuts.com, they rely on return visitors like me, and so do their advertisers. Since I trust psdtuts, I trust that they will not offer spam ads. As such, they are still able to sellout their 125×125 ads monthly, and at a premium price!
Rich
Rich
September 16, 2008
To add what Rich said, quality content is the key.
Quality content draws returning, loyal readers. They’re likely to support you by clicking on ads. Sites that depend on viral gimmick to generate huge traffic hits, will see the conversion rate very low. It’s not always about # of unique hits.
Jin
September 16, 2008
Nice article, but I’m afraid you missed one thing: ad blocking software. Adblock for firefox is getting more and more popular, ab thus more and more people not only stop clicking ads, but they stop even seeing them (like me for example). Google ads are no exception, adblock can block them too.
I think that the online advertising market will still exist for some time in its current form, but in a few years it can shrink signifiantly. Or turn into some new idea
Doctor
September 16, 2008
Hey, Thanks for those comments:
@Rich @jin
I agree very strongly here, at times dont mind clicking on ads on websites like psd tuts as they do not annoy me. they are very related and worth bookmarking. Plus they have attractive ads.
@doctor
Excellent point, i showed all of my friends adblock plus its probably the best extension in the history of firefox.
But on the other hand people who use firefox are more tech people, and they usually avoid ads. So installing adblock just makes life easier, it doesn’t effect the clicks we do.
kumailht
September 16, 2008
People who use plugins like ad block are ridiculous.
When a site shows ads it’s because that’s the way they make money and can continue to give you the content you wish to see. If you cut the site’s source of money, you also give them no incentive to continue to publish.
The idea that ads are the scourge of the earth is just wrong.
On another level, the PPC system for payment is flawed. No one visits a site to click on ads, but if they see an ad on a page the impression is still made in the same way traditional ads affected people in TV and magazines.
All ads should be CPM based with clicks as an added bonus. That’s what it is – a prize when that 2 – 3% hit the ad.
Alex
September 16, 2008
The web advertising bubble may deflate a little but I don’t think it will burst, not as long as there is an audience there.
Aside for having a large audience another reason I don’t think it will burst is because web advertising has the benefit of more precise data associated with it, like Click Through Rates.
Advertisers simply to to develop smarter, effective, and less annoying ways to advertise.
Wardell
September 16, 2008
I don’t think online advertising will fail to sell. I once work on digital company, working on revamping a website that is top 10 in Alexa region Indonesia. They made USD 100,000.00 a month (that’s really huge for a country like Indonesia). All came from banner ads.
And when checking on Analytics, companies who advertise there got an increase of more than 100% visits than the previous month.
Saying banner ads won’t sell is like saying television commercial won’t sell. People has a lot of tv channels to choose from, yet advertisers still ripe the benefit of tv ads.
It’s really funny you are saying these things while you have a banner ads in the top right corner. Don’t you think you are making advertisers go away?
Adheaven
September 17, 2008
@Adheaven
Hi, it is true that advertisers will continue to advertise as long as its a high traffic site and the people are clicking on the ads. In most countries adblock plus is very famous and people ignore ads, so this will lower the click rate.
Even though I have ads on my blog, I would not let them effect content in any way.
Thanks for commenting
kumailht
October 22, 2008
People only ignore ads that are unrelated, why do you think Google does so well? It’s because they target sites with similar keywords and ads show up in their search for the same keywords as the person is looking for. I in no way think that online ads will fail, not now and not anytime within the next 5 years. Honestly, I just think it’s going to get a whole lot bigger.
Marketing Advertising Business
December 25, 2009
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