The Future Of Free Is Social

For large swaths of consumers, the right to access free online content is seen as sacrosanct -- and has been hugely influential over their expectations of what the Internet is and what it should provide. But with ad-blocking on the rise, there is little recognition or willingness on the part of the consumer to accept that ads are at the core of this.

Frustration is the principal driver of ad-blocking at the moment. According to our research, almost six in ten ad blockers are in the “Frustrated” group (saying that ads are intrusive, annoying or that there are simply too many of them). Interestingly, four in ten find themselves in the Selective segment -- those who might be using ad blockers, but who also say they engage with some ads or have found brands/products via online advertising. Large numbers of ad-blocker users are still willing to engage with ads, then; the key is that ads need to be relevant and non-intrusive -- a feat that is possible, if far easier said than done. 

While some publishers have simply denied access to ad-blocker users (a tactic that is risky when so many competitors keep their doors open), others have tried to increase engagement with subscription-based models. The obvious problem here is that so many digital consumers remain reluctant to pay for online content that is currently available via ad-supported models. The substantial discrepancies between the numbers using, versus the numbers paying for, music and movie streaming services are stark reminders of this: far more people will subscribe to free ad-based versions of a service than pay for access to the premium tier.

Certainly, that 16- to-34-year-olds are the most likely to be paying for content is a dose of good news, suggesting that this mindset is likely to become more widespread in the future (particularly in light of Apple Music’s decision not to offer a free tier). In reality, however, willingness to pay is linked very strongly to the type of content on offer. Consumers are a lot more likely to be paying for content streaming services like Spotify or Netflix than they are for news Web sites or premium Web services. And this is where Amazon’s Prime service makes sense, bundling an expanding host of services (music, movies, video, commerce perks, food delivery, etc.) under one monthly subscription plan could well be a glimpse of the future. More services could choose to combine things that people will pay for with those they won't, ensuring that both get revenue.

Even so, stand-alone subscription models remain impractical for much online content. And here it is social channels that offer considerable promise. The almost universal reach of social media and the migration of many online activities onto social platforms has essentially positioned the likes of Facebook, Snapchat and YouTube as middlemen between content creators and consumers.

The ability of most of these social platforms to deliver (comparatively) user-friendly cross-device ads using logged-in data is already a clear strength, but the development of social chat bots and their future marketing potential is where the real value of social shines through. With the consent of the consumer, chat bots could re-engage users on a 1:1 basis in a non-intrusive and relevant manner, in an environment largely out of reach of ad blockers and at the cost of the brand or advertiser.

Such an evolution is in line with how consumer behaviours are changing. Look at the channels people say they use when they want more information about a product, brand or service and, while search engines still top the table in all demographics, the age-based splits are revealing. Older groups remain the most wedded to “traditional” sources such as consumer reviews, price-comparison sites and brand Web sites, but younger groups are leading the charge towards “newer” options such as vlogs, social networks and mobile apps. In fact, social networks are not far from toppling search engines as the top destination for 16- to-24-year-olds. No less important is that 16- to-24-year-olds are about twice as likely as 55- to-64-year-olds to be using voice search/control tools on their mobile devices -- almost one in four are.

Of course, pragmatism is essential here. Some consumers will always resist brand interactions in any form. AI and chat bots are still in their nascent stages, and it will take time for them to become sophisticated enough to handle non-basic interactions without any human intervention. And some brands will find a much warmer reception in social contexts than others (dictated largely by the services and content they have to offer).

Nevertheless, consumers are spending more time each year on social networks and on mobile devices, they are (relatively) happy to engage with brands in social contexts when the value exchange is clear, video consumption and search are both set to expand inside the social arena, and AI/bots will only become more and more sophisticated -- facilitating personalized and relevant conversations in a resource-light way. If free is to prevail, things are therefore likely to become still more social in the years ahead.  

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