Native Ads (Native Advertising or also Native Display Ads) refer to all paid advertising formats that are discreetly marked as ads. Native Advertising is, simply put, advertising that does not look like advertising. Native Ads offer small disadvantages, but above all advantages. Did you already know? According to an AppNexus white paper, it is CTR native display advertising on average 8.8 times higher. According to Forbes, native ads increase purchase intention by a full 18%. Also in our customer projects we always measure a higher CTR. What does this have to do with? Personalization of content, storytelling and more discreet communication channels: recommendation marketing. Why Native Advertising? What is native advertising? What does advertising mean?
What are Native Ads? definition
We all know them: Sponsored content. When reading online magazines, in social media platforms. Native Ads nestle almost unobtrusively into the environment of the respective medium. Native ads are therefore visually as well as personalized, content wise adapted to the environment of the advertising measure. Native ads can be distributed in online advertising as well as in print advertising.
Typical markings are:
“Recommended for you”
When a user clicks on these ads, they are redirected to a third-party website / app. This is just an example of native ads. Native advertising, as described, cleverly disguises itself in existing media formats. This includes aspects of design (color, font, font size, etc.) as well as the targeted addressing of the audience.
Native ads enable brands and companies to deliver desired content in a non-typical, sales-promoting way. Unlike banner ads, native ads look like a natural part of the user interface. So it does not interrupt the UX (User Expirience).
70% of users want to learn more about products through content, not traditional advertising.
- Integrative advertising (unobtrusive)
- Indirect, sales-promoting measur
- Also for PR, Online Reputation, Brand Awareness
Why Native Ads?
In recent years, display ads have been the means to promote online sales. Banner blindness and ad fatigue are real, and advertisers have a challenge to combat them.
We all know the phenomenon of overdosed advertising from the city center. Who still notices individual posters? Even on the Internet, users ignore advertising banners or even block them completely, using ad blockers. The “classic” display advertising in online marketing is losing its effectiveness (not its relevance) as users become more and more immunized. Out of the necessity to adapt to the new user behavior, native advertising was born.
Native Ads is advertising that does not look like advertising, or simply put:
in 1990 articles were bought in magazines, today in online magazines
Advantages & Disadvantages of Native Ads
Here at a glance, the advantages & disadvantages of Native Ads. We start with the disadvantages:
Disadvantages of this strategy: monitoring and time
- Measurement of success
- Time, work and costs
- Hidden marking
Measurement of success
Measuring the performance of native ad campaigns is one of the most difficult challenges to solve for each individual campaign. Precise statements about key performance indicators such as return on investment (ROI) are difficult to measure.
Time, work and costs
Native Ads is also always called storytelling. A good story, an appealing design (for example, for infographics, etc.) requires time and talent. If you “only” rely on social ads, a good, meaningful graphic is ideally enough.
By our definition, Native Ads are all paid-for advertising formats that are discreetly marked as ads. Therefore, it is even more important that users are only confronted with online advertising that is fair, clear and appealing and really delivers added value. Often such Native Ads are marked “too discreet”, which also causes criticism.
Advantages of the strategy: personalization and CTR
- Recommendation marketing
- Tailor-made contents
- Higher CTR
Tailored content from native ads is more trustworthy than traditional advertising, as you can see in the market and online advertising development metrics, as they are more targeted, informative and entertaining for the target audience compared to traditional advertising. They encourage users to think and, as a PR tool, can also have an effect on reputation and brand image.
75 % of the users deal with a topic exactly when the interest is greatest (source: Reuters). This is exactly the time for native ads. Because it usually does not matter whether the content is branded or not.
To make this work, you create a real emotional connection to the user, through content that is tailored to the personality of the user / target group, through more appealing layouts and designs, as well as videos and infographics.
As seen in the drawbacks, it is difficult to measure the exact success of native ad campaigns. What is easy to understand, however, is the higher click-through rate (CTR) compared to typical display ads.
Another example? Clark+Meyler’s native advertising campaign for GE (General Electric, USA), reached 5.1 million people and required a full 416,000 click-throughs. That is a CTR of over 8 %. The comparison to traditional display ad CTRs is exciting. In the year 2000, this was still a full 9%, but by 2012 it was only 0.2%. This is why one usually measures in CPM (Click Per Mille). Basis for these key figures are clicks and impressions.
Advertising expenditure and development in marketing
The more effective click rate for us also goes directly to the market key figures. How is online advertising currently developing?
Online advertising in Germany
Online advertising is becoming increasingly important. The figures show that. In 2017, online advertising was still generating revenues of around EUR 7.4 billion. In the same period, the figure was EUR 8.7 billion for advertising in print media. One year later (2018), the figure had already reached 7.9 billion (+ EUR 500 million compared to the previous year; source: Federal Statistical Office).
Worldwide digital marketing
In 2021, online is expected to account for 52 percent of global advertising expenditure for the first time (source: Internet World). This is the general trend in spending on online advertising worldwide in the years 2014 to 2020, as well as a forecast up to the year 2024.
- 2014 – USD 146.62 billion
- 2016 – 191.87 billion USD
- 2018 – 283.35 billion USD
- 2020 – USD 332.84 billion
- 2022 – USD 441.12 billion*
- 2024 – USD 526.17 billion*
*Forecast from Statistia
Native Ads are not a new phenomenon, but they are becoming more and more popular in companies. While many are still working on Facebook accounts, some early adopters have been around for a while. In the USA for many years now.
Find more statistics at Statista
Expenditure on native ads will increase to approximately $41.1 billion in 2019 (exact figures are not yet available). This means that native ads already have a market share of 61% in the USA when it comes to digital display advertising (source: eMarketer).
Native Ads: Examples
In the following I want to introduce you to some new features and give you some ideas how to place native ads.
Online Magazine: Content Marketing
Focus, Ntv, Spiegel, Vogue, Bravo, in all magazines you will find “Recommended articles”. These are the big players. If you want to play native ads, you prefer to use such online portals, with wide reach and reader retention or SEO power (search engine optimization). Who wants to build a really effective network, uses such A-Online-Media and scatters additionally on B-Online-Media (thus smaller, for example blogs). These in turn refer to the articles or content placements in the large online portals.
Thus the 1st page on Google is gradually filling up with positive recommendations.
After the best family vacation I ever had, I really wanted to tell you about my camping vacation at the North Sea. We started with our new roof tent to discover the sea … I have found in a roof-tent comparison …
Podcasts: Audio Example
The number of podcast listeners is increasing from month to month. Millions of people in this country now follow their favorite podcasts on Spotify, Deezer & Co. If you’ve ever listened to American podcasts, you know that native ads are “normal” in the episodes.
After I repaired my car, I was finally on the road again with my sports car this weekend. The garage wanted to rip me off, so I did it myself. Do you already know the XYcars.com? Two weeks ago I was in the garage and they wanted to charge me hundreds of dollars. You know what I did? I went to XYcars.com and ordered the parts myself, for half price. The Auto Shop team makes it so easy for you to find the right parts…
Traffic changes. While 5 years ago we had more than 80%, 90% of our customer projects with visitors coming from desktop PCs (Mac, Windows, Ubuntu & Co.), today it is often 80%, 90% of the visitors are surfing the mobile. The market share for Native Ads, which:
- the technical status of the end devices,
- as well as the data transfer
increase in their relevance. Anyone who wants to advertise must think mobile today. Native ads hardly play a role here, however, with only 8% of online marketers relying on native ads last year. A large part of the advertising budget, however, flows into video ads.
- Video Ads – 51%
- Display Ads – 17%
- In-App purchases – 10%
- Other – 8%
- Native Ads – 8%
- Affiliates – 3%
- Membership / Subscription – 3%
Find more statistics at Statista