Native / Display Ads: Advertising in online media

What are native ads? Definition

We all know them: sponsored content. When reading online magazines, on social media platforms. Native ads nestle almost inconspicuously into the environment of the respective medium. Native ads are therefore both visually and personalized, with content adapted to the environment of the advertising measure. Native ads can be used in both online and print advertising.

Typical markings are:

“Sponsored content”

“Recommended for you”

…

When a user clicks on these ads, they are redirected to a third-party website/app. This is just one example of native advertising (native ads). As described, native advertising cleverly disguises itself in existing media formats. This includes aspects of design (color, font, font size, etc.), as well as targeting the audience.

In Berlin, Cologne, Düsseldorf, Munich, Hamburg and across Germany, native ads allow brands and companies to deliver desired content in a non-typical, promotional way. So unlike banner ads, native ads look like a natural part of the user interface. It therefore does not interrupt the UX (user experience).

70% of users want to learn more about products through content, not traditional advertising.

Native Ads:

• Integrative advertising (unobtrusive)
• Indirect, sales-promoting measure
• Also for PR, online reputation, brand awareness

Why native ads?

In recent years, display ads have been the means to drive online sales. Banner blindness and ad fatigue are real and advertisers have a challenge to combat them.

We are all familiar with the phenomenon of overdosed advertising in city centers. Who notices individual posters anymore? On the Internet, too, users ignore banner ads or even block them completely with ad blockers. “Classic” display advertising in online marketing is becoming less effective (not less relevant) as users become more and more immunized. Native advertising arose out of the need to adapt to new user behavior.

Native ads are ads that don’t look like ads, or simply put:

In 1990 articles were bought in magazines, today in online magazines

Advantages & disadvantages of native ads

Here is a summary of the advantages and disadvantages of native ads. Let’s start with the disadvantages first:

Disadvantages of this strategy: monitoring and time

1. Performance measurement
2. Time, work and costs
3. Hidden labeling

Performance measurement

Measuring the performance of native ad campaigns is one of the most difficult challenges to solve for each individual campaign. Precise statements about key figures such as return on investment (ROI) are difficult to measure.

Time, work and costs

Native ads also always mean storytelling. A good story and appealing design (e.g. infographics, etc.) require time and talent. If you “only” rely on social ads, a good, meaningful graphic is ideally enough.

Hidden labeling

According to our definition, native ads are all paid advertising formats that are discreetly labeled as ads. It is therefore all the more important that users are only confronted with online advertising that is fair, clear and appealing and really delivers added value. Such native ads are often labeled “too discreetly”, which is also a source of criticism.

Advantages of the strategy: personalization and CTR

1. Referral marketing
2. Customized content
3. Higher CTR

Customized content

Tailor-made native ad content is more trustworthy than traditional advertising, as you can see in the key figures on the market and the development of online advertising, as it is more targeted, informative and entertaining for the target group compared to traditional advertising. They encourage users to think and, as a PR tool, can also have an impact on reputation and brand image.

Referral marketing

75% of users engage with a topic when they are most interested in it (source: Reuters). This is precisely the time for native ads. Because it usually doesn’t matter whether the content is branded or not.

To make this work, you create a real, emotional connection with the user through content that is tailored to the personality of the user/target group, through appealing layouts and designs, as well as videos and infographics.

Higher CTR

As seen in the disadvantages, it is difficult to measure the exact success of native ad campaigns. What is easy to understand, however, is the higher click-throughrate (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 416,000 clickthroughs. That is a CTR of over 8 %. The comparison with traditional display ad CTRs is exciting. In 2000, these were still as high as 9%, but by 2012 it was only 0.2%. This is why they are usually measured in CPM (click per mille). These key figures are based on clicks and impressions.