By Kunal Gupta, CEO, Polar For the past year, I’ve ended emails, phone calls, and editorials with the a sign-off claiming native ads as an exciting new format. While native ads, and the innovative ways they are implemented excites me, they are not exactly new anymore.
Truthfully native advertising has existed for a very long time. Television commercials are mini movies or shows that emulate the format of the content your watching. The entire podcasting industry has survived to date on show hosts incorporating deals, from companies like Audible.com or Dollar Shave Club, into the humor of the program.
What’s changed is that publishers have turned the corner on what they can accomplish in the process of serving native advertising. As a publisher you now have a brand new set of tools helping you create and share sponsored content. The problem however, is one which many pioneers face: It’s on publishers to drag customers into the modern era, in this case the adoption of native ads.
Just last year, I read articles and listened to panels proclaiming TV was still king and nothing would knock it off the throne. This week, with help from the IAB, we’ve learned that dynamic is changing dramatically, with internet advertising overtaking television in ad spend. It’s incredibly hard to invent a new ad product in television, but when you pair it with new online concepts, like the approach Twitter takes with native ads becoming part of television viewer’s real-time conversations, you tap into the tried and tested aspect of marketing – the mix.
Let’s take a closer look at a couple of those IAB numbers. When it comes to their share of digital ad spend dollars, banners have slid a little to 19 per cent (which still amounts to almost $8-billion – a slight rise over 2012’s dollar amount), while sponsorship has held steady at 2 per cent (almost $800-million). These formats aren’t going to switch places overnight. It proves banners are still a formidable format that is adapting in its own way.
Native is great for brand awareness and top-of-the-funnel marketing activities, while display is great for performance and bottom-of-the-funnel marketing activities like conversion and activation.
Think of it like this: At their conception, banner ads were meant to be clicked and contained a strong call-to-action. At times that’s now an after thought. Banners are the billboard displays of the information highway, they remind you where you’ve been and where you’re going.
Pictured above: A Washington Post native ad for financial holding company, CIT. Not only is a banner accompanying the article, it's no ordinary display ad; it contains a Twitter feed, content, interactive polls, and more.
They can dominate a readers peripheral vision and need to be a part of the mix if brands want to stay top of mind. Great sponsored content is sticky and sharable, but great sponsored content coupled with banner domination and cookies can linger long after a reader is done with the initial story and accomplish several marketing goals simultaneously.
This hybrid method might be the key to success for publishers. A recent study conducted by Copyblogger showed that only 9 per cent of advertisers and marketers have a dedicated native advertising budget. If native advertising is going to grow it’s going to cut into the existing display ad allocation. By showing how native and display can bolster each other and are intrinsically linked, one can modernize the tested banner, while legitimizing the premium status of native.
I’ve pointed to the example of Starcom before - they introduced a standard banner which mines a publisher's older content to produce an ad relevant to the brand or product it’s promoting. This is product that appeases the traditional marketer, yet dips their toes into an unfamiliar world without challenging the line items on their traditional budget.
Marketers and advertisers have shown no fear of purchasing sponsored content on Twitter and Facebook – the social sites’ increased revenue can attest to that. But the previously mentioned Copyblogger survey shows marketers don’t necessarily consider it native advertising. Strip away the naming conventions, whatever you call it – it’s working.
I don’t expect every marketing dollar to pour into sponsored content, so let us let go of the decisive rhetoric. Native ads are are here to stay – but so are the stalwart formats, like the banner, that came before them. Striking a balance between the bleeding edge and traditional formats is where we’ll find success, and the space between is where innovations lays.
Kunal Gupta (@kunalfrompolar) is the chief executive officer of Polar (@aboutpolar) and has been recognized as a Top 30 Under 30, a United Nations Global Citizen and Ernst & Young’s Entrepreneur of the Year.