Advertorials have been almost since the dawn of the news business; the concept of native advertising is nothing new. At its most basic, a native ad is a paid-for story that mimics the look, feel and style of the editorial that surrounds it. The idea is to present commercial messages in the context of the users’ experience so that it feels less intrusive than a display ad. The hope is that readers will click through to the advertisers own web property.
Many high profile news sites and social networks have been offering native ads to brands for quite some time. Twitter and Facebook have a similar offering in ‘sponsored stories’ and ‘promoted tweets’. LinkedIn has invested a lot in its native strategy and Pinterest is now piloting an ad service. Last week Yahoo and Tumblr, too, announced the launch of integrated ads.
Online news sites Buzzfeed, Mashable and The Huffington Post all have their editorial and production departments involved in generating sponsored content. Last week native ads went mainstream with the launch of The New York Times new website and a subdomain which distinguishes paid content in the publication from editorial content. Dell was the inaugural featured brand.
The launch instigated some journalists to comment that the Times is destroying its blue-chip brand. They argue that native ads will do nothing to foster the people’s trust and that readers will start to tune out proper editorial content as they do ads. Jeff Jarvis, a respected journalist and blogger (of Dell Hell fame) blogged about the Times launch: “Do you find value in reading an opus from Dell about “Reaching Across the Office from Marketing to IT“? I don’t. I go to Dell to buy hardware, not words.”
The issue is native advertising’s potential to confuse readers about what is and what is not news. Making ads look too much like editorial could be seen as deceptive or could risk turning readers off altogether. University of San Francisco research shows that people don’t remember seeing the words ‘sponsored by’ on articles and updates. Indeed half of the people surveyed were not sure what it means for content to be ‘sponsored’.
That’s why the ad industry is taking steps to set standards for ethics and behavior. The Times plans to keep sponsored content and the newsroom separate. News staff will not be involved in paid content; freelancers will do the job. Also, sponsored articles will carry a label and full disclosure, a common practice for native ad content. In addition, the Interactive Advertising Bureau has released a Native Ads Playbook to provide guidelines for ad units, formatting and disclosure.
Like it or hate it, native advertising is here to stay. News organizations were on their knees as advertisers fled in droves; publishers needed to find a revenue model that works. Native advertising provides the solution; it’s a format that brings value to readers and brands are willing to pay for it. According to the American Press Institute, the news site BuzzFeed is entirely reliant on native advertising revenues and more than half of the Atlantic’s digital revenue is driven by native ads.
Why? Because it works. PG Media Lab surveyed 4,770 consumers for Sharethrough. The study showed that native ads registered an 18 per cent higher lift for purchase intent and nine per cent higher lift for brand affinity than banner ads. Participants looked at native ads 53 per cent more frequently than banner ads, and one in four looked at in-feed native ads. In a Forbes survey of 2,259 people, those viewing branded content were 41 per cent more likely to say they would buy the product.
“We believe native ads are quickly becoming the de facto ad format on mobile and increasingly moving into desktop,” said lead analyst Doug Anmuth in J.P. Morgan’s annual “Nothing But Net” report, released on last week. According to the report, native ads represented five to ten per cent of Facebook’s 2013 impressions, but accounted for more than 60 per cent of the company’s revenue.
Jeff Jarvis wrote that he had “recently warned a roomful of PR people itching to advertise natively: Content is a sh*tty business. Stay away! I predict that the fad will soon lose its luster.” I disagree. Native ads provide value to brands, readers and publishers alike. Until something better comes up, news organizations will come to rely on native advertising revenues as a mainstay of the publishing business.
This article was first published on Thornley Fallis.