3 Ways Marketers Can Navigate an Ad-free World

Sarah Steimer
Marketing News
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Key Takeaways

What? Ad-free subscription services are on the rise.

So what? Traditional advertising may not hold up as more consumers opt into a paid, ad-free subscriptions.

Now what? Marketers should consider alternative approaches, including content marketing, direct marketing and improved services and products.

​Aug. 30, 2017

Marketers should consider moving away from traditional advertising and closer to customers

Consumers can typically recall advertisements from their childhood; they can hum a jingle or recite a slogan. The children of tomorrow, however, may only have one ad recollection: the quiet click of opting out.

Ad-free subscriptions are on the rise, leaving traditional advertising in the dust. For some perspective, consider a 2016 estimate from CordCutting.com that suggests each Netflix subscriber avoids about 160 hours of commercial-watching annually by streaming content through the ad-free service. It’s not only television or movie content that is going ad-free. Music platforms Spotify and Pandora offer ad-free subscriptions, and operating systems such as Apple’s latest version of MacOS, High Sierra, will offer a reader mode that strips out ads. Google has also announced plans for a built-in ad blocker for its Chrome system.

Consumers are on board with giving ads the boot, due in large part to exhaustion. Although advertising has been around for decades, it feels more painful than ever because consumers’ attention has become limited, says Bob Gilbreath, co-founder and CEO of internet marketing agency Ahalogy.

“Advertising has always been a tax on our time and attention,” Gilbreath says. “As the demand on our attention goes up, the price of our attention goes up and that tax feels worse and worse.”

The advent of digital access—be it mobile, in-home or elsewhere—has also made consumers more selfish with their time and demands. The audience is used to getting what it wants, when it wants it, which makes advertisements feel jarring and generally disruptive.

Traditional advertising still has its purpose, but its placement has begun to slowly dissolve. Marketers need to shift gears as more consumers opt out. Consider three ways to adapt or perish.

1. Content Marketing

If consumers are tired of being interrupted, the obvious answer is to stop interrupting them and maybe even add some value to their lives with content marketing.

“It’s not interruptive,” Gilbreath says. “You might find ways to put your useful content in front of someone like paid media, a paid social post, but at the end of the day it’s about getting into the habit, building the models, getting the right team together, getting your software platforms together. It’s not about the new ways to interrupt people, but finding new ways where the marketing helps them in their lives and in their experience.”

Gilbreath says the B-to-B world has already begun to master content marketing, offering consumers white papers, blog posts, videos, how-tos or challenge sales, wherein a salesperson educates a client or prospect about a change in the market.

“By making [consumers] smarter, you’re able to present your product or service as a solution to the biggest business problems,” Gilbreath says. He predicts a rise in in-house content expertise whether through an R&D lab, what the company is doing in its field or joining forces with outside experts.

Creating and hosting original content has the added bonus of brand safety. There are degrees of separation between an advertisement’s creation, hosting and performance when it comes to media buys, and recent cybersecurity fraud issues have muddled click results. Self-publishing also allows the brand to avoid having its name stationed near other content that could be deemed controversial.

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2. Direct Marketing

Removing ads from media platforms means a shift from fishing for customers to strengthening brand-consumer relationships. Where marketers may be jolted by the potential loss of basic data from media relationships, they may build a deeper set of data by getting to know their customers better.

“Everyone should aspire to be a direct marketer and not have to count on these random ads being strewn all about,” says Peter Fader, a professor of marketing at the Wharton School at the University of Pennsylvania. “Move to a bona fide relationship with customers and prospects. It’s hard and we don’t have the mindset or the infrastructure right now, but in the end, if we can do that well, we’ll make a whole lot of money and get better data than relying on the ad-based approach.”

Gilbreath says e-mails from a brand are a great direct marketing tactic, provided the e-mails contain useful content and inspiration. Fader, on the other hand, says the answer isn’t in finding a new platform to place ads on (“It was billboards, then magazines, then TVs and e-mail, then mobile, now let’s find ways to jam things into Snapchat.”), it’s about thinking of other ways to talk to the consumer.

This more direct attitude is what the subscription model is all about. For a fee, media companies offer consumers a better overall experience, which may happen to include the removal of advertisements. Fader argues that brands could take a cue from these platforms and join the subscription game. This could look like Blue Apron or Birchbox, or it could be a partnership with a company like Amazon, which offers a subscribe-and-save model that allows customers to receive regularly scheduled deliveries of specific products at discounted rates.

“That approach is still in its infancy, but I think that’s what’s going to take off,” Fader says. “That’s when we’re talking about a bona fide relationship. It might be through an intermediary, through an Amazon or Instacart. From a brand such as Tide’s standpoint, the data they’d be getting about me would be so much better than anything they would get in a mass media advertising world. They would have a much better sense of which individual is buying which product and when.”

Fader acknowledges the role traditional advertising plays for introducing newer brands to consumers or spurring awareness and reminders. 

3. Improving Services

If marketers aren’t spending as much on traditional formats in the future, they may have the opportunity to use the money for improving products and services.

“If you look at what startups call marketing, they call it growth-hacking,” Gilbreath says. “The mindset there is, ‘I’m a startup, I don’t have tens of millions of dollars for advertising, so I need to find creative ways for my product to sell itself.’ Often that’s where you have to find ways to make the product viral or ways to spread it around.”

For established brands, product or service improvement shouldn’t be conducted for the mass market, Fader says. Instead, the improvements should be customer-centric and focus on acquiring or keeping the customers identified as more valuable than the rest.

Fader uses Electronic Arts as an example. The gaming company has stopped focusing on how many units of a new game it can sell and instead asks how the product can teach the company more about those buying it.

“If EA comes up with a game that’s going to help it acquire valuable new customers or [a game that] enhances the value of existing customers, then the value of that game to the firm is worth 100 times the number of units it sells,” Fader says. “Using products as a way to fish for and maintain relationships with the best customers, that’s what it’s all about.”

Companies can also boost their relationships with consumers through loyalty programs that keep the firm at the top of customers’ minds and track customer data. These aren’t the loyalty programs of yore that require a punch card and “get one free” incentives. Modern loyalty programs should be used to learn more about the individual customer’s needs and wants. Fader says offering gifts or promotions to loyal customers shows that the company is trying to learn more about the consumer’s interests and needs so it can better align its communications and offers to the individual or group.

“The real key to customer centricity isn’t only to cross-sell,” Fader says, “but it literally is to surround them with a variety of products and services from which you make no money to show that you really have their best interests in mind.”

Ad-free subscriptions may not have taken over (yet), but marketers need to refocus on customized content that reels in and maintains relationships with valuable customers. Customer engagement, like personalized subscriptions, can no longer be one-size-fits-all.

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Author Bio:

Sarah Steimer
Sarah Steimer is a staff writer for the AMA's magazines and e-newsletters. She may be reached at ssteimer@ama.org or on Twitter at @sarah_steimer.
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