Native advertising is getting a ton of hype, but it is not a new concept. Brands ran “advertorials” in newspapers beginning in the 1900s, and adopted new native strategies with the advent of radio and TV.
The actual term “native advertising,” however, was not officially coined until 2011, by Fred Wilson at the Online Media, Marketing & Advertising conference. Since then, it has been the subject of countless blogs posts and digital marketing conferences.
Nowadays, the conversations have begun to focus on the potential of “programmatic native,” with true innovators looking to combine the power of native ad units with the precision and personalization of people-based marketing.
What is Native Advertising?
The proliferation of the term “native advertising” has led to confusion. According to the IAB, native advertising is “a means to deliver paid ads that are so cohesive with the page content, assimilated into the design, and consistent with the platform behavior that the viewer simply feels that they belong.”
Native comes in many shapes and forms. A native ad could be an in-feed ad on Facebook or Instagram. It could be a quiz, like “Which donut are you?” that BuzzFeed created for Dunkin Donuts. It could be a story, such as the “Woman Going to take Quick Break After Filling Out Name, Address on Tax Forms” that was published in the Onion and sponsored by H&R Block. It could also be product recommendations or editorial-based content recommendations seen at the bottom of articles prefaced by, “You may also like…”
The Native Controversy
The term “native advertising” has also become a lightning rod for sentiment in the industry, eliciting both criticism and praise.
Skeptics criticize native because an ad that looks like editorial content but is not explicitly labeled as such could be interpreted as deceptive to readers. The Federal Trade Commission (FTC) is combatting this problem with strict regulations about how native ads must be labeled.
An additional criticism of native is that the high degree of customization it requires can be very straining to both publishers and advertisers. Programmatic native continues to make strides in addressing this problem, as it provides more data for better targeting, greatly improved efficiency, and the ability to scale.
Proponents of native are confident that it is the only possible response to the changing expectations of consumers in a multi-device world. They believe that people-based marketing unlocks the promise of native, as it offers the ability to provide engaging native ad units to real people, wherever they are paying attention.
Native is Here to Stay
Native is not perfect, but it is certainly not going anywhere. It has been predicted that native ads will drive 74% of all ad revenue by 2021.
The main drivers of native advertising are increased user engagement and improved performance. Native ads perform better than traditional banner ads, especially on mobile devices. In 2015, average click-through rates for premium native ads on mobile devices were 4x higher than those of non-native display ads. These high-performing ad units also drive higher CPMs (cost per thousand impressions) for publishers. When compared to a standard banner ad, a native ad unit commands between 18% and 200% higher CPM.
Native advertising also combats ad blocking, which is an industry wide problem. Ad blocking prevents publishers from earning the revenue they need to continue producing the content consumers enjoy, and prevents advertisers from engaging with their loyal consumers in meaningful ways. The primary reason that people block ads is because they find the ads intrusive or annoying. Native provides a solution by creating a seamless user experience.
Email – The Ultimate Native Experience
While many publishers and advertisers have started taking advantage of programmatic native on social platforms and on the web, they have been neglecting an important channel: email.
It only makes sense to extend native to email. After all, email is a critical component of the cross-channel customer journey, and it reaches an engaged audience of opted-in subscribers. People are spending more time with email, especially millennials who are constantly on their phones. Time spent with email rose 17% in 2015-2016.
Secondly, email is inherently people-based. Social platforms have been dominating native ad spend in part because they use logged-in user data, rather than cookies, to track and market to users across devices. Programmatic email platforms also use the email address as a reliable method of cross-device identification.
The email environment provides even more benefits. Fraud is currently a problem for advertisers and publishers. Fraudsters go where the money is, and a lot of money is going to native. The email environment is virtually fraud free, as emails are only opened by real people.
Benefits for Publishers
Publishers have recognized that email can help them pull people away from social platforms, and back to their owned and operated properties. As such, email newsletters are getting the design attention once reserved for websites, with some publishers even building their own newsletter technology.
If publishers are spending valuable time and resources to create engaging email newsletter experiences across screens, their advertisements need an upgrade. Native ads provide non-disruptive experiences and preserve editorial integrity.
Creating a better user experience also maximizes the ability to monetize. Premium native ads are in demand by advertisers, and publishers can adopt native ad formats to garner high CPMs.
Benefits for Marketers and Advertisers
Email is undoubtedly one of the top channels to engage with opted-in audiences. So while native advertising campaigns perform well on the web and on social platforms, including email will be a win-win for marketers/advertisers and subscribers. Studies have shown that 72% of people prefer to receive promotional content through email, compared to 17% who prefer social media.
Native advertising in email also provides unique targeting opportunities for advertisers. An advertiser can use their own anonymized first party data (such as CRM data or website data), match that to publishers’ anonymized email addresses, and target these known audiences with relevant ads. This is the power of people-based marketing.
Consumers want seamless, personalized experiences with brands. With people-based marketing, brands can anticipate their buying behaviors, and target them with engaging native ads as they move between channels and devices.
For more information on how native advertising works in email newsletters, contact us to speak to a real LiveIntenter.