Close to 60 digital advertising leaders from 16 countries gathered for the International Breakfast Session at the 2016 IAB Annual Leadership Meeting in Palm Desert, California. The focus this year was tackling the pressing issues facing the industry and how we can all work together globally to advance our common interests.
Randall Rothenberg, President and CEO, IAB, and David Doty, EVP/CMO & Head of International, IAB, opened the breakfast by welcoming everyone and highlighting the year of strong collaboration for the IAB Global Network.
Alexandra Salomon, Senior Director International, IAB, reviewed the agenda for the morning and handed over the podium to Scott Cunningham, Senior Vice President, IAB, & General Manager, IAB Tech Lab, to lead the town hall discussion on Ad Blocking.
Cunningham opened the town hall with a review of where we stand in approaching ad blocking. We need to start engaging consumers who have ad blockers installed, and explain to them the exchange for access to free content on the internet. At the same time, if we are going to have that conversation, we need to put our best foot forward by improving the user experience with the LEAN Principles. These principles guide our pursuit for the next generation of digital ad standards. The ad blocking challenge is global, and the IAB Tech Lab has been working closely with international IABs on an approach to solutions.
Guy Phillipson, CEO, IAB UK, continued the discussion by sharing research on ad blocker usage from the IAB UK’s recent Ad Blocking Report, conducted by YouGov. Most notably, he highlighted:
- 18% of British adults online are currently using ad blocking software, a rise from 15% in early June
- Ad blocker users are mostly male (23% versus 13% female), and 35% fall in the 18-24 year old demographic
- The top three reasons why people want to block ads are because “ads interfere with what I’m doing” (48%), “too many ads on the page” (36%), and “ads are not relevant to me” (14%)
- The least objectionable ad format is skippable ads, while ads overlaying content were the least preferred
Learnings from this report will serve as useful data points for the development of core principles for good advertising practices that everyone should embrace.
Townsend Feehan, CEO, IAB Europe, followed up with the draft of an industry charter—a statement of intent on good advertising practices, developed by a small working group with IAB Europe, IAB France, IAB UK, and IAB Tech Lab. As a next step, the draft charter will be shared with the international IAB leaders for review and feedback to see what changes are needed before it moves to the next iteration.
Cris Camargo, Executive Director, IAB Brazil, explained how there has been very little ad blocking research done in Brazil. So far, only news publishers are reporting about 18% of readers using ad blockers. In addition to recommending that publisher members of IAB Brazil adhere to advertising best practices and LEAN principles, Camargo intends to conduct market research this year.
Toru Takata, Senior Vice President Chief Product Officer, Yahoo! JAPAN, added that ad blocking is not an issue in Japan with barely 1% of traffic being affected. The main reason is that ad blockers have not been localized and are not available in Japanese. However, the page loads are getting slower and this is an issue that Yahoo! JAPAN pays very close attention to.
Following up on the conversation held at the 2015 IAB Global Summit, Sherrill Mane, Senior Vice President, Research, Analytics, & Measurement, IAB, underlined the importance of the economic impact studies IAB produced with Harvard Business School, in showing the growth of the ad-supported digital ecosystem and the jobs it created. Feehan spoke specifically about the study IAB Europe and IHS conducted in the framework of a European commission very focused on digital issues and data protection rules. The report, published at the end of November 2015, illustrated how online advertising is a key driver of the European digital economy that promotes business and economic growth and paves the way for broader digital sector innovation.
The key findings include:
- 0.9 million European jobs are supported by online advertising – direct (0.4% of EU-28 total)
- 1.4 million jobs if indirect and induced effects are taken into account
- 4 million or 2.5% of EU-28 jobs if broader ripple effects are taken into account
- Online advertising is an integral funding model for high growth digital sectors in Europe
- With growing focus on data and technology, online advertising is an incubator for digital skills that rejuvenate different industries and also can transform economies of the future
Mane concluded the discussion with a summary of the parameters for other countries to consider when preparing to do similar economic impact studies. She encouraged IABs to participate, as this kind of fundamental work can add to the understanding of digital’s contribution to a country’s economy as much as advertising revenue reports already do. As a next step the hope is to explore the possibility of doing more national-level studies with IABs collecting similar data, e.g. on jobs, to enhance comparability across markets.
Nick Terlizzi, Partner, Media and Entertainment Services, EY, highlighted the findings from the study IAB and EY released in December 2015, “What Is an Untrustworthy Supply Chain Costing the U.S. Digital Advertising Industry?” This study reflects the cost impacts of invalid traffic, infringed content, and malvertising-related activities that exploit the supply chain in the U.S. There is a clear interest to work with other IABs around the world to expand this study, as Mane stated, “You cannot fix what you cannot measure.”
Chen Yong, Secretary General, IIACC/IAB China, revealed preliminary findings from the first-ever report with PwC on the interactive advertising industry in China. As this report is a work in progress, the figures remain confidential until the report is finalized in the next few months.
Stephen Li, Vice President of Business Development, Nielsen China, wrapped up the morning with a review of the Chinese interactive advertising industry. China is a huge yet highly fragmented media market with the majority of internet access coming from mobile devices. According to a recent Nielsen study, mobile video is dominant, and 55% of mobile video viewers are watching at least once a day, 34% several times a week, and 11% once a week or less. Chinese consumers are increasingly blurring the lines between TV, PC, and mobile—often watching a show on one platform while engaging in social media on another. Looking at the data from eMarketer on total media ad spend share in China by media, it is not surprising to see that Chinese advertisers are shifting spend to digital, but not fast enough when taking into consideration the time spent online. Li concluded that the two key things to unlock the growth of the digital advertising industry in China are standards and measurement.
Please save the date for the next IAB Global Summit, to be held in New York on September 28 and 29, 2016. In the meantime, we are excited to see the IAB Global Network continue to increase in size, scope, and capability. See more at iab.com/global.
Browse the full Facebook photo album of the IAB Global Network here.