Background

Real-time/Programmatic Ads

Ad blocking is pervasive

30–50% of users browse while blocking ads.

publishers around the world will lose $54 billion in ad revenue due to ad blocking in 2024, representing around 8% of total global ad spend. If not for ad-filtering tools that enable users to elect being shown only non-intrusive ads, those losses would be notably higher—about $116 billion. (Johnson 2023)

Don Marti

Concepts

With a peer or two, define and exemplify:

asymmetric information and responses to it
signaling
“Banner blindness”
retargeting

Concepts

asymmetric information: one party knows more than other (e.g., used car is a lemon); responses include licensing, guarantee/warranties, brand trademarks & ads
signaling: “… shows that a seller has the money to advertise … and believes that the product will earn enough repeat sales to justify the ad spending” (Marti 2017).
“Banner blindness”: users disregard visual noise (i.e., ads)

“Targeted Advertising Considered Harmful”

Why?

. . .

Broad, un-targeted, ads are signals of quality

Targeting: A cycle

Statistics about performance of individual ads feeds into dangerous self-deception about the industry-wide effects of targeting. However, as the audience begins to understand targeting, the rate of ad blocking increases, the value of web ads decreases, and increasingly crappy ads drive more user demand for ad blocking. (Marti 2017)

Privacy: Quality

Fortunately, better privacy tech, such as stricter treatment of third-party cookies, makes targeting more difficult and less accurate. The value of advertising across the entire medium rises, it’s harder for ad networks to “snatch” audience from high-reputation sites, and those sites will be able to get more ad revenue and control, at the expense of middlemen. (Marti 2017)

Paradox?

An individual ad will have a higher click-through rate if we personalize it to the user, and
Online advertising as a whole will be less profitable if we personalize ads to users.

What dilemma did we learn about that describes these situations?

. . .

Tragedy of Commons or Prisoners’ Dilemma

On the Media

Let’s listen to the clip and take note of pros vs. cons on ad blocking; you will be participating in your own debate.

ex: Split-room debate

A or B?

Ads and free content: Ad-blockers are destroying online publishing and should be prohibited.
Blockers and control: Ad-blockers are useful and their use should be encouraged.

Steps

Move to the side of the class for your position.
1. Think of at least one argument for your position (because you agree, or think it’d be interesting to argue). (< 3 minutes)
Briefly discuss within your group some key arguments. (< 5 minutes)
I will ask someone to start with an argument for their position.
1. Present only one argument; be short. (< 1 minutes)
2. Someone in opposing group responds.
3. Reiterate (without repeating; hopefully everyone will speak).