Do You See What I See? Ad Viewability and the Economics of Online Advertising

37 Pages Posted: 20 Oct 2016 Last revised: 1 Mar 2017

See all articles by David Bounie

David Bounie

Télécom Paris

Morrisson Valérie

Centre d’Étude des Supports de Publicité (Center for the Study of Advertising Media)

Martin Quinn

CATÓLICA-LISBON School of Business & Economics

Date Written: March 1, 2017

Abstract

Between 40% and 50% of online ads served by publishers are actually never seen by Internet users, resulting in ineffective branding campaigns and a considerable waste of money for advertisers. In reaction, more and more advertisers use technologies to measure the viewability of advertising campaigns on publisher websites. This paper provides the first comprehensive economic analysis of the impact of the adoption of such technologies on the economics of online advertising. We construct a two-sided market model for advertising where publishers manage their website to attract Internet users and advertisers. We show that the adoption of ad viewability technology affects the number of viewable ads displayed by publishers, the price of ads and publisher profits, and user experience. We finally analyze the total welfare impact of ad viewability and examine how ad-blockers constrain publishers from both sides of the market.

Suggested Citation

Bounie, David and Valérie, Morrisson and Quinn, Martin, Do You See What I See? Ad Viewability and the Economics of Online Advertising (March 1, 2017). Available at SSRN: https://ssrn.com/abstract=2854265 or http://dx.doi.org/10.2139/ssrn.2854265

David Bounie (Contact Author)

Télécom Paris ( email )

19 Place Marguerite Perey
Palaiseau, 91120
France

Morrisson Valérie

Centre d’Étude des Supports de Publicité (Center for the Study of Advertising Media) ( email )

92300 Levallois Perret
Anatole, 55 RUE
France

Martin Quinn

CATÓLICA-LISBON School of Business & Economics ( email )

Palma de Cima
Lisbon, Lisboa 1649-023
Portugal

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