And recent findings suggest that, in some cases, annoying ads can literally cost publishers more money than they generate, leading to a cost of up to $1.50 CPM for ads that may net the publishers well below that amount.
A group of Microsoft researchers published their findings in last December’s issue of the Journal of Marketing Research. Specifically, they calculated the economic cost associated with presenting annoying ads to readers.
To do this, they first compiled a set of 144 ads, which they ranked in terms of how annoying these ads were to a sample of 141 users. From this, they selected the 10 most-annoying and 10 least-annoying ads.
Next, they designed a field experiment in which an additional set of 1,223 users were asked to read a Web page and to categorize its content into one of four predefined categories. The content on the page could be presented by itself, or it could be flanked by skyscraper ads, which were drawn either from the more-annoying or less-annoying set. Users were paid for each item they categorized (regardless of whether they categorized it correctly or incorrectly), and they could choose when to stop.
Not surprisingly, users who had to deal with the more-annoying ads viewed a lot fewer pages (“impressions”) than those who had to deal with less-annoying ads, or with no ads at all. This provided an estimation of the economic value of dealing with annoying ads.
Through a carefully controlled experiment design, the authors were able to estimate the incremental cost of 1,000 impressions with the more-annoying ads, relative to a page with no ads, at $1.53. Even when comparing more-annoying ads relative to less-annoying ads, the incremental CPM cost was $1.15.
Given that many of the more-annoying ads also tended to be associated with lower-quality ads, which typically fetch well below $1 CPM, publishers would be economically better off not showing annoying ads. That’s because the number of page views they lose from annoyed visitors outweighs the monetary benefit of the ads delivered.
Furthermore, although this particular study focused entirely on aspects of an ad itself that made it annoying, other factors such as page clutter, pop-ups and takeovers can further increase visitor annoyance even if the quality of the ads is higher, leading to even greater “hidden” economic costs.
Even more importantly, these results are based strictly on the immediate economic value of an impression, and do not take into account long-term effects such as lowering the visitor’s perception of the publisher site, or the likelihood that visitors, annoyed by the ads, will not return.
While the details of these results surely depend on the specific ad, the website, the visitor, and many other factors, the message is clear: Maximizing ad revenue by filling more inventory with low-quality, annoying ads can potentially have a negative economic impact even in the short term -- let alone the long-term negative consequences to the publisher’s brand.