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The effect of ad blocking on website traffic and quality

Author

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  • Benjamin Shiller
  • Joel Waldfogel
  • Johnny Ryan

Abstract

Ad blocking software allows Internet users to obtain information without generating ad revenue for site owners, potentially undermining investments in content. We explore the impact of site†level ad blocker usage on website quality, as inferred from traffic. We find that each additional percentage point of site visitors blocking ads reduces its traffic by 0.67% over 35 months. Impacted sites provide less content over time, providing corroboration for the mechanism. Effects on revenue are compounded; ad blocking reduces visits, and remaining visitors blocking ads do not generate revenue. We conclude that ad blocking poses a threat to the ad†supported web.

Suggested Citation

  • Benjamin Shiller & Joel Waldfogel & Johnny Ryan, 2018. "The effect of ad blocking on website traffic and quality," RAND Journal of Economics, RAND Corporation, vol. 49(1), pages 43-63, March.
    • Handle: RePEc:bla:randje:v:49:y:2018:i:1:p:43-63
    DOI: 10.1111/1756-2171.12218
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    Cited by:

    1. Brett R Gordon & Kinshuk Jerath & Zsolt Katona & Sridhar Narayanan & Jiwoong Shin & Kenneth C Wilbur, 2019. "Inefficiencies in Digital Advertising Markets," Papers 1912.09012, arXiv.org, revised Feb 2020.
    2. Tobias Regner, 2021. "Crowdfunding a monthly income: an analysis of the membership platform Patreon," Journal of Cultural Economics, Springer;The Association for Cultural Economics International, vol. 45(1), pages 133-142, March.
    3. Garrett A. Johnson & Scott K. Shriver & Shaoyin Du, 2020. "Consumer Privacy Choice in Online Advertising: Who Opts Out and at What Cost to Industry?," Marketing Science, INFORMS, vol. 39(1), pages 33-51, January.
    4. Vilma Todri, 2022. "Frontiers: The Impact of Ad-Blockers on Online Consumer Behavior," Marketing Science, INFORMS, vol. 41(1), pages 7-18, January.
    5. Christian Peukert, 2019. "The next wave of digital technological change and the cultural industries," Journal of Cultural Economics, Springer;The Association for Cultural Economics International, vol. 43(2), pages 189-210, June.
    6. Ūsas Antanas, 2019. "Consumer Loyalty Interfaces with Website Quality," Management of Organizations: Systematic Research, Sciendo, vol. 82(1), pages 87-96, December.
    7. Batikas, Michail & Claussen, Jörg & Peukert, Christian, 2019. "Follow the money: Online piracy and self-regulation in the advertising industry," International Journal of Industrial Organization, Elsevier, vol. 65(C), pages 121-151.
    8. Rex Yuxing Du & Mingyu Joo & Kenneth C. Wilbur, 2019. "Advertising and brand attitudes: Evidence from 575 brands over five years," Quantitative Marketing and Economics (QME), Springer, vol. 17(3), pages 257-323, September.
    9. Martin Peitz & Anton Sobolev & Paul Wegener, 2023. "Ad Blocking, Whitelisting, and Advertiser Competition," CRC TR 224 Discussion Paper Series crctr224_2023_448, University of Bonn and University of Mannheim, Germany.
    10. Rex Yuxing Du & Mingyu Joo & Kenneth C. Wilbur, 2018. "Advertising and Brand Attitudes: Evidence from 575 Brands over Five Years," Papers 1810.07783, arXiv.org.
    11. Gaston Giordana & Paolo Guarda, 2019. "Why do social networks introduce virtual currencies?," BCL working papers 132, Central Bank of Luxembourg.
    12. White, Gareth R.T. & Samuel, Anthony, 2019. "Programmatic Advertising: Forewarning and avoiding hype-cycle failure," Technological Forecasting and Social Change, Elsevier, vol. 144(C), pages 157-168.
    13. Zhuo, Ran & Huffaker, Bradley & claffy, kc & Greenstein, Shane, 2021. "The impact of the General Data Protection Regulation on internet interconnection," Telecommunications Policy, Elsevier, vol. 45(2).
    14. Bleier, Alexander & Goldfarb, Avi & Tucker, Catherine, 2020. "Consumer privacy and the future of data-based innovation and marketing," International Journal of Research in Marketing, Elsevier, vol. 37(3), pages 466-480.
    15. Suárez, David & García-Mariñoso, Begoña, 2021. "Does ad blocking have an effect on online shopping?," Telecommunications Policy, Elsevier, vol. 45(3).
    16. Koot, Martijn & Wijnhoven, Fons, 2021. "Usage impact on data center electricity needs: A system dynamic forecasting model," Applied Energy, Elsevier, vol. 291(C).
    17. Chinchanachokchai, Sydney & de Gregorio, Federico, 2020. "A consumer socialization approach to understanding advertising avoidance on social media," Journal of Business Research, Elsevier, vol. 110(C), pages 474-483.
    18. Catherine Tucker, 2023. "The Economics of Privacy: An Agenda," NBER Chapters, in: The Economics of Privacy, National Bureau of Economic Research, Inc.
    19. Shunyao Yan & Klaus M. Miller & Bernd Skiera, 2020. "How Does the Adoption of Ad Blockers Affect News Consumption?," Papers 2005.06840, arXiv.org, revised Aug 2021.
    20. Aleksandr Gritckevich & Zsolt Katona & Miklos Sarvary, 2022. "Ad Blocking," Management Science, INFORMS, vol. 68(6), pages 4703-4724, June.

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