What is native advertising?
Native advertising is a type of advertising that fits the natural form and function of its environment. This means native ads can come in many different formats so that they can better blend into their surroundings.
"sponsored by…”
web films
photo streams
Interactive graphics
promoted tweets
sponsored stories
paid discovery
Native ads can perform better than banner ads
25%
of consumers
are more likely to view native ads compared to traditional banner ads*
52%
more views
for native ads compared to banner ads*
18%
higher lift
for purchase intent responses than traditional banner ads*
40%
cheaper costs per click**
53%
better click-through rate**
* eye-tracking study by Sharethrough
** AdRoll survey data
Native ads may soon dominate the market
US Native Display Ad Revenue
- Native Display
- Non-native Display
Note: Display includes all banner, rich media, sponsorship, and video ads
This is especially the case on social channels
Native adversiting revenue
- Native-Style Display
- Sponsorship
- Social
They also may be better at reaching millennials
Aged 17-34 today, millennials are much less likely to pay attention to traditional methods of advertising. However, native advertising—especially when shared over social media—can deliver with this generation. The ability to reach millennials with effective ads will prove crucial for businesses. In just the US, they’re a quarter of the overall population with $200 billion in annual buying power and will spend $10 trillion within their lifetime.
Sources: Dan Schawbel, Forbes and Erin Nelson, AdvertisingAge
Native advertising tips to reach millennials
The headline is the content
- 1 in 5 millennials exclusively read headlines.
- 80% of millennials say headlines should be informative.
In-feed native ads are preferable to all other digital advertising
- 80% of millennials say in-feed native ads are a good user experience.
- 44% of millennials say in-feed native ads improve their perception of the publisher, site, or app.
Credibility, trustworthiness, and timeliness are the most important qualities of a content feed for millennials.
What do marketers actually think about native ads?
In March 2016, AdRoll asked 4,092 companies about their experience with native advertising. 571 companies participated. Here’s what they had to say.*
*91% managed accounts, 9% small- and medium-sized business accounts
Native ads are more viewable with higher engagement
64%
of respondents
felt native ads are more viewable
53%
of respondents
said they have higher engagement
But only some marketers are certain of better performance
44%
agreed
that native ads have better performance
11%
disagreed
that native ads have better performance
45%
unsure
that native ads have better performance
Most marketers plan to spend at least $5K on native ads
65%
of participants
are currently running native ads or plan to within 12 months
HOW MUCH DO YOU EXPECT TO SPEND ON NATIVE ADVERTISING?*
N=136
- < $1,000
- $1,001–$5,000
- $5,001–$10,000
- $10,001–$25,000
- >$25,000
*On average, these advertisers spent $39,813 on web retargeting in the past year.
Performance is most important when deciding on a platform
What are the goals for your native ad campaigns?
N=196
It’s also possible that factors like viewability are harder to measure, and therefore regarded as less important.
Conversions are the main goal for native ad campaigns
What are the goals for your native ad campaigns?
N=196
Given that performance was the most important factor, it makes sense that conversions are the main goal
Marketers stopped running native ads mostly due to poor performance, high cost, and difficulty assessing success
Why did you stop running native ad campaigns?
N=101
Some other reasons cited include: lack of transparency, inexpensive looking ad placements, and change of goals.
Though many were spending relatively less before they stopped running native ads
How much were you spending on native advertising when you stopped?
N=101
- < $1,000
- $1,001–$5,000
- $5,001–$10,000
- $10,001–$25,000
- >$25,000
Which platforms were you running native ads on when you stopped?
N=136
Many marketers have never run native ads and don’t plan to because they don’t know how.
Why aren’t you planning to run native ads in the future?
N=87
This could change as native advertising matures and suggests there’s an opportunity here for both a land grab and education.
What channels do marketers use?
Among all channels, Facebook is the most popular
It’s the highest rated channel in terms of hitting goals, and thus, the most popular channel for native ads.
While only 48% of marketers running native ads on Facebook say they are achieving their goals, 82% will maintain or increase their Facebook media budget.
Reasons why they’re increasing or maintaing spend on Facebook
“Efficient, robust targeting, self-serve dashboard, breadth of messaging/creative, scale, continual upgrades.”
“Our product receives a lot of social shares and our Facebook ads are getting comments from previous buyers, so we are very encouraged to continue in this venue.”
“Explore the full potential of Facebook network.”
Instagram is rated just above neutral, while Twitter isn’t hitting goals
Instagram performance was rated just above neutral.
Marketers running native ads on Instagram are unsure of the channel, but 42% are planning on increasing investment.
Reasons why they’re increasing or maintaing spend on Instagram
“Client moving towards better imagery and understanding goals of Instagram campaigns.”
“Exciting new platform to advise on, but results not quite as strong as Facebook.”
“This is a new ad platform so I am expecting continuous product improvements throughout the year.”
Twitter campaigns are not hitting goals.
Only 22% of respondents with native Twitter campaigns hit their goals, and only 18% are planning to increase spend.
Reasons why they’re increasing or maintaing spend on Twitter
“Twitter only works for very specific types of brand awareness campaigns.”
“Have to be there for brand exposure, but from a direct response (DR) perspective they don’t perform.”
“Poor conversion rates but great tweet engagement, but the goal is conversions.”
Few marketers are using other channels—but of those who are—they’re seeing decent performance
Other Channels
e.g., LinkedIn, Bing
Only 41 out of 571 respondents use other channels for native advertising.
However, these other platforms—such as LinkedIn and Bing—appear to be performing well.
Nearly 60% of these campaigns are performing to expectations, and over 50% of respondents expect to increase spend in the next year.
Reasons why they’re increasing or maintaing spend
“We have found this works well for discovery on specific products, so we use it in a more limited and defined way.”
“Still collecting initial data.”
“It’s a different audience than on other platforms and has great conversion rates.”
Of those not running native ads, most plan on running them on Facebook and Instagram.
which platform do you plan to run native ads on within the next 12 months?
N=136
So if native is getting big, what should you be doing?
Understand different native ad types and best practices
- Pay attention to headlines—they play an even bigger role for native ads.
- Understand where your content is shown (e.g. in feed, as recommendation, both) and tailor your content accordingly.
- Create compelling content that your customers want to see in their feeds. For direct response ads, this might mean that your headlines are more descriptive or more focused on the price or call to action. Play around and see what works.
Test different native channels using a programmatic partner
- Every channel has a different format. Programmatic partners help you connect with users across channels with one set of creative.
Invest more in the native channels that work for you
- Native advertising—especially through a programmatic partner—is growing quickly and offers you even greater scale with fewer individual channels to manage.
Appendix
On Native Ads
Are native ads more likely to be viewed?
N=546
Do native ad have better performance?
N=545
Do native ads have higher engagement?
N=543
On Channels
N=196
To what extent are native ads hitting your goals on different channels?
Are you running native ads on any of the following platforms?
On Facebook
N=187
To what extent are your Facebook native ad campaigns achieving your goals?
How do you expect your spend on Facebook native advertising to change in the next 12 months?
How much do you currently spend on Facebook native advertising per year?
On Instagram
N=67
To what extent are your Instagram native ad campaigns achieving your goals?
How do you expect your spend on Instagram native advertising to change in the next 12 months?
How much do you currently spend on Instagram native advertising per year?
On Twitter
N=60
To what extent are your Twitter native ad campaigns achieving your goals?
How do you expect your spend on Twitter native advertising to change in the next 12 months?
How much do you currently spend on Twitter native advertising per year?
On Other Channels
N=41
To what extent are your native ad campaigns on other channels achieving your goals?
How do you expect your spend on native advertising on other channels to change in the next 12 months?
How much do you currently spend on native advertising on other channels per year?
