One of the fastest growing trends in advertising is native advertising. Research firm BIA/Kelsey estimates native advertising on social media alone will grow to $5B in 2017, from $3.1B this year. The reason for the fast growth is the reported effectiveness of native ads in engaging users.
A 2013 study done by Sharethrough found that consumers looked at native ads 53% more frequently than display ads. The study also found that native ads resulted in an 18% lift in purchase intent than banner ads and 32% of respondents said they would share a native ad with a friend or family member while only 19% said the same for display ads.
Native advertising is a big opportunity for local businesses and advertisers, as well as national advertisers, to create additional revenue streams. But there are both pros and cons and unique best practices for using and creating native ads.
What Is Native Advertising?
At its core, native advertising is content marketing, a practice in which companies create engaging content to build relationships with consumers. Generally, native ads are characterized by the following:
They mimic the content around them in appearance or content or both. For example, in a travel magazine, a native advertisement may appear as story or column about a particular destination.
They are a form of paid media, rather than earned media, although native ads can support owned media.
They are labeled to indicate they are not editorial content.
Native advertising is all around you. For example, native ads are found on Facebook as News Feed ads, Twitter as Promoted Tweets, Buzzfeed as sponsored posts and even on Pandora as a branded playlist.
These ads take all forms of media whether print, digital, video or audio. And they can be placed almost anywhere within that media such as one unit within a newsfeed or list, a result in response to a search, a recommendation as similar content at the end of a story, or as a call-out in the middle of a story.
Some Pros & Cons To Native Advertising
Native advertising benefits from being opt-in in nature by virtue of the relevance to the platform or content selected by the user. The ads understandably foster high levels of engagement with consumers leading to new revenue streams.
Native ads translate well on mobile and generally have a longer life than traditional advertisements. These all result in attractive performance metrics. Celtra, a cross screen technology company, measured the performance of mobile native ads and found their CTRs were nearly 3X those of standard banner ads.
On the other hand, native advertisements are new and are, therefore, still evolving. Metrics and KPIs around native advertisements aren’t fully defined. Because of the customized content or design of native ads, they are more labor intensive.
Local and national businesses and advertisers must be prepared to invest in their content ability, from a financial and personnel perspective. Businesses must also be sensitive to transparency to consumers about the sponsored nature of the content or risk misleading them, a consequence that has both legal and business concerns.
At this point, perhaps due to the challenges in making native ads scalable given the extra costs to customize them, native ads tend to be used more for awareness than for specific action based results. A Sharethrough study of marketing executives from leading brands found awareness, branding and brand affinity to be the top marketing objectives for native mobile ads.
Measuring The Performance Of A Native Advertisement
Identifying relevant metrics is still a challenge in the world of native advertising, but businesses can apply the “5Ws” to assess how well their native ads are performing:
Who Is Viewing The Content? The ad’s effectiveness is derived from matching advertising content with the interests of specific audiences. It’s important to make sure that native advertisements are being viewed by your business’ target audience.
What Types Of Content Does My Audience Find Most Engaging? A native ad can focus on many things – the product, the brand, or the industry — and take many forms such as a video, image, or text. Figuring out what type of content your audience likes best is crucial to keeping them engaged.
When & For How Long Are They Viewing It? Checking the views on a video or click-throughs on a website or the time spent reading a piece of written content can help you identify whether your content is attractive and when your target audience wants to consume it.
Where Is My Audience Viewing My Native Ad? A Google poll found that 70% of consumers who looked up information for a local business found a store within five miles of their location – so it’s important for local businesses with a storefront to reach consumers who are close by. Also, it’s worth investing time and resources into finding out where your consumer is viewing the ad and accessing content, such as mobile or social.
Why Are They Viewing My Content? Your target audience cares about consuming content for specific reasons. Are they researching something or are they looking for a specific business? Are they trying to decide which restaurant they want to eat at? Each of these decisions falls within a different Last Mile segment that should affect how you advertise.
Best Practices For Implementing Native Advertising
Proper use of native advertising poses a challenge for small businesses. With native advertising still in its infancy, there is general confusion around content strategy, internal roles, and channel selection, among other topics. The Altimeter Group, in a report by analyst and Marketing Land contributor Rebecca Lieb, has documented eight critical elements for success in use of native advertising:
Transparency, Disclosure, & Trust – don’t pretend to be something you’re not.
Content Strategy – invest in making sure the ad has the appropriate tone, messaging, and positioning to fit its surroundings.
Collaboration – make the message and branding consistent with other branded content.
Earned Component – use it to bridge paid and earned media extending the reach of both.
Content Portability – design it to be portable to other platforms, either in whole or in part.
Training – train specifically and uniquely for native advertising.
Ability To Scale – this remains the most difficult goal, but continued developments in use of technology should evolve the ability to scale.
Measurement – adjust or tweak ads based on performance metrics – its customized nature makes it particularly suitable to do so.
Ultimately, native advertising is worth the upfront investment of resources required to execute it well. Creating successful native advertisements can generate new customer leads, engage current customers, and strengthen your business’ relationship with your customers.
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