Though a major revenue opportunity for web-publishers, native advertising doesn’t just make money, it also enhances the audience experience. The real challenge in creating native ads is to make the ads make sense as part of a site’s overall content. Without the native branded content, the website should be less interesting. This demands a much higher level of ad individualization from site to site and much more creative content from brands.
When banner and sponsored text link ads and pop-ups were the web’s primary ad vehicle, creating Internet advertising was considerably simpler. Standardized sizes and locations for ads allowed marketers to design ads that worked across many websites. Some websites still rely on these types of static ads and links and intrusive popups for their primary source of revenue generation. They are, after all, more easy to set up. But they are also much less effective.
With the advent of pop-up and ad-blocker technology, consumers turned away from sites with more interruptive advertising in favor of sites with little or no advertising at all. In an effort to address the ineffectiveness of display ads, web companies like Google began offering sponsored content. Google AdWords offered advertisers paid first placement in search results. Twitter monetized itself using sponsored tweets and Facebook began paying its bills with sponsored stories built into its site content.
The rise of native monetization has had an impact on site design. A cadre of new content marketers has moved away from creating websites designed solely to maximize the number of page views generated by visitors. They’ve replaced the old designs in which ads were simply add-ons with designs that, from the ground up, integrate native advertising into the natural flow of the sites. The approach is more subtle, but is proving far more effective in terms of how many customers actually click on the ads.
In designing native ads that are more fluid and less interruptive, ad designers incorporate content streams, galleries or grids to encourage visitors to ‘discover’ advertising messages as content. This kind of advertising is far more demanding than display advertising for designers, because, whether the ad is a video or an interactive ad, it has to perform two separate functions: it has to deliver interesting content that is related directly to the website’s overall purpose and it must subtly promote the product or brand as well. This means that ads for Facebook have to be different than ads for Twitter, Google or Youtube. Because many of these sites started out free of advertising, customers would revolt if they were suddenly loaded down with pop-up ads, intrusive banners and display ads. For these social media sites, especially, native advertising was virtually the only way to monetize their operations.
Native monetization models create an alignment between a company’s mission and its revenue strategy. With advertising that looks and feels like part of the content that the site delivers, some sites have successfully replaced traditional one-way advertising formats with unique branded content experiences. Intel and Toshiba, for instance, developed a six episode short film for their ads. ESPN recently offered an 8-minute documentary on fans who continue to root for their favorite teams after they die (see film at top of post). Old Spice has produced some entertaining music videos. American Express offers branded educational content designed to aid growing small businesses.
In the coming years, the trend should encourage even more creative ad packages as more major brands begin shifting larger portions of their advertising budgets toward native monetization strategies.
Consumers will, of course, become more savvy consumers of native advertising. Companies like Outbrain that offer content distribution of branded content to advertisers help ensure that native ads are not only in sync with websites where they are placed but are also truly useful to website users. Advertisers must resist the urge to use native ads to lure viewers and then blast them with a hard sell the way too many pop-up ads have done. If native monetization schemes can avoid poisoning the well the way too many display advertisers have done and will stick with providing useful content to web surfers, then native ads will likely become more trusted over time and attract more and more click-throughs. Those brands that merely disguise advertisements as content without returning real value to consumers will find that they alienate viewers as often as intrusive pop-up advertisers have in the past. As the quality of native advertising improves, however, consumers will come to expect branded content that is visually appealing, interesting and useful to them. Advertisers will have to continually improve the quality of their branded content or native advertising will come to be ignored.