Native advertisement is an online advertising method where the advertiser attempts to gain attention by providing content in the context of the user’s experience; while not distrusting the user’s flow.
Om Malik in an article he wrote for Fastcompany asserted that Native Ad is going to work primarily for social media platforms and not publishers. He gave some very valid reasons.
Publishers (not social media) have lots of overhead and are also recording a decline in revenue generated from display and banner ads. Users are engaging a lot less and ignoring banner ads. CTR (Clickthrough Rate) has declined for publishers. For publishers to stay in business, they have to create new forms of income streams.
The traits possessed by social media platforms that make native ad a hit for them are:
- The users create the contents themselves;
- There are gargantuan users in tens or hundreds of millions;
- It’s free to use and the users do not pay for contents;
- The format of the social media platforms are great for ads;
- They have a treasure trove of demographic data… which allow them to be surgically precise in offering the right ad at the right time;
- They can weave the native ads within the contents with ease without disrupting the users.
If you look very closely, you’ll notice that these traits listed above are missing from online publishers.
Native ads by online publishers haven’t been as successful as it has been for social media platforms; publishers even struggle to distinguish between native ads (that are paid for) and the contents that they created by themselves.
Publishers do not have as many users as most social media platform do. It also costs an arm and a leg to create the contents that will appeal to the audience they are trying to attract.
It will be fun to see how Instagram will pull off native ad on a grand scale when they make the platform open to all advertisers.
Om Malik completed the article by saying:
That’s why native ads will not be sustainable for publishers or their advertisers. The hits can be fun–kudos to Gawker for getting a lot of buzz with a clever tack like “We’ve Disguised This Newcastle Ad as an Article to Get You to Click It,” but it can never use that trick again. Worse, hits like that defy my definition of native advertising: They interrupt me. And that means, for publishers at least, expect native advertising to go the way of the pop-up ad.
Until online publishers find a way to not interrupt their visitors with banner ads and native ads that appear in form of real story and erode the trust visitors have on the credibility and originality of the story, they’ll continue to struggle with generating revenue from native ad while the social media platforms will continue to excel.
Source: Fastcompany
