How to Take Advantage of Native Advertising

Native advertising is on its way to dominating the market. So we wanted to know more. How do marketers think of native ads? What platforms work best? And are native ads meeting their goals? See what we found.

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

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.


Source: Chris Schreiber, Sharethrough

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.

facebook

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

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

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?