The End of Online Ads?

Jacob Brain — March 23, 2018

As a marketing agency, we see the place advertisements have online. If used correctly, they can be a great way to deliver a very targeted message to specific website users with products and services they actually need. Unfortunately, we are also aware that a vast majority of online advertisements are annoying, intrusive, and usually, promote products that are useless to us. That is simply bad marketing, but I will save that rant for another day.

There may be a solution

If you are like 99% of us, you know that one guy that seems to turn every innocent conversation into a discussion around cryptocurrency – and, more specifically, into a conversation about how he is one market spike away from buying the New England Patriots.

How does that relate to online advertising and marketing? Crypto mining.

What is crypto mining?

Without diving into the technical weeds of cryptocurrency, crypto mining is a process by which you use special programs to solve complicated mathematical problems in order to add blocks to the blockchain (essentially, the ledger for a cryptocurrency), thereby getting the cryptocurrency equivalent of cash. It is pretty complicated, but at the end of the day, miners do it for one reason – money.

Using Bitcoin as the example, there are 21 million bitcoins available as stipulated by the bitcoin protocol. Not all of these have been mined yet (and won’t be until around the year 2140), so until then there are companies and individuals working to mine them.

To do this, however, required A LOT of processing power. Miners buy custom-built computers and processors to get a leg up on other miners. On top of the cost of equipment, miners will also spend thousands on electricity costs. It is a game of small advantages. There is even a mining company in Iceland that uses the naturally cold climate to cool its computers.

There is another way, however.

Can I borrow your computer?

Instead of spending thousands of dollars on equipment and even more on the electricity bills, miners can actually use JavaScript provided by companies like CoinHive to use your computer’s resources for their mining operation. The theory behind it is that a news site, for example, can use a portion of each visitor’s computer processing power to make money mining cryptocurrency, instead of by flashing online advertisements in front of you. Is that a tradeoff users are willing to make?

While there are lots of privacy concerns that play into this, let’s focus on the advertising side of the technology.

RIP Online Advertisements?

Some say that this is the end of online advertisements, and others say that this will be another flash in the pan. In all likelihood, it will probably be a combination. Websites likely make too much money off advertisements to simply get rid of them entirely and transition to the crypto mining revenue model. And too many companies need to get in front of users’ eyes for ads to disappear completely. But, advertising could become less obtrusive. And crypto mining could become another revenue source to combine with more traditional models.

If this is to work, however, websites will need to follow a few rules in order to avoid making users angry.

Ask for Permission

If a website is secretly using your computer to mine, then they are essentially running malware on your computer. The same messages that some sites use for cookie permissions can be used for mining permissions. If a site promises no advertisements in turn for a few CPU cycles, many users may be more than happy to make that switch.

Limit CPU Usage to 10% – 20%

What is worse than getting 37 irrelevant online advertisements shoved in your face? The website using so much of your computer’s CPU that it can barely function.

If you give the website permission, then it should have a CPU usage cap set on it so that you (ideally) don’t even notice it is there. Whether this limit is set by the site or the user’s settings, it needs to somehow be limited. The question of how much CPU usage users find acceptable has yet to be answered.

Only Run on Open Tabs

It makes sense that sites should only be able to borrow your computer’s resources if you are currently on their site. The second you move to a new tab, the mining needs to stop. Otherwise, users will have 5 sites running script on their computers. Even if the sites are well within their acceptable CPU usage, the user may experience slow down.

At the end of the day, nobody knows what the future of this new technology will be. Maybe it will replace advertisements completely (unlikely), maybe it will be an alternative, or maybe it will just fade away in the coming months.

Regardless of what happens, it is important to stay on top of these technologies as, while it may not seem like it, they directly affect your marketing strategy. If you are a business that relies heavily on banner advertisements, it is absolutely critical to stay on top of this. You may need to look into alternative advertising means.

(73)