By now you’ll have heard an awful lot about native advertising. Like the fact that it will save us all (maybe), that news companies see a financial future in it, and that it while it sure can attract a whole lotta love, alas, the time has not come for The New York Times to embrace it.
A quick recap: native advertising is independently compelling content (text, video or other) that is paid for by a brand, and semi-camouflaged in a publication’s natural editorial environment. It should neither stick out like a sore thumb nor dupe the reader, somewhat like how the model in the picture above blends prettily into her bed of leaves, without leading anyone to believe that she herself is plant-based.
“Interruptive” ads, for a bit of contrast, are the opposite of native; clumsy, unengaging and intrusive, these still-lucrative squares and rectangles are like an uninvited party guest who makes everyone else feel uncomfortable. These days, with “turn mobile audience into ad revenue” at the top of many a to-do list, this is becoming increasingly awkward; having an interruptive ad appear on your smartphone screen is like getting stuck with that guest in a narrow hallway while you wait in line for the powder room.
As Digiday’s Jack Marshall has put it, if analogue advertising brings in dollars, and digital advertising brings in dimes, then mobile— for all its famously bar-graphed opportunity— brings only pennies. But a look at the companies that are managing to roll these pennies and take them to the bank reveals an element of common ground: “they’ve shunned standardized smartphone display units in favour of native or content-driven ones,” Marshall writes.
One example is BuzzFeed, a native advertising advocate, whose revenues are apparently “on track to be three times higher than last year,” and which sees higher rates of audience engagement with marketer content on smartphones than on desktop platforms, according to Marshall. Another is Facebook, which went from making almost nothing from mobile ads in the first quarter of this year to bringing in over $150 million in the third quarter – equivalent to a higher-than-expected 14 percent of total ad revenue. Sponsored Stories, the cornerstone of its revenue model, were generating around $500,000 a day on mobile platforms by June.
So native ads blend into content, are more palatable than interruptive ones, and can even work on mobile platforms. But what do they look like? And is it… ethical?
If the publisher is BuzzFeed and the brand is Obama…
In the weeks leading up to the U.S. presidential election, Obama for America had the honour of becoming the first political campaign to give native advertising a go on BuzzFeed. Above is one example of a post. Others involved Jay Z and those notorious binders filled with females.
As is the case with all of BuzzFeed’s Featurd Partners, the Obama campaign had the option of either working with the media outlet's ad team to develop a concept, or of simply posting existing content on the site. They chose the latter. And as is always the case for BuzzFeed, this sponsored content is clearly labeled as such: a yellowish box above the headline marks the video “Paid Political Content,” and another box below the blurb re-emphasizes “Political Ad Paid For By Obama for America."
If the publisher is Atlantic Media, and the brand is IBM…
Above is an elaborate infographic on The Atlantic's website that offers users information about social media adoption by Fortune 500 companies, the prevalence of technology in the marketing sector, and the use of data in police work. The mentions of IBM, the sponsor, are sparse: an IBM SmartCloud plug here, a quick reference to IBM analytics there…
Leading to this graphic is a boxed title on the home page that reads, “Sponsored Content: Infographic: Using Data to Keep the Peace,” and whose font and colour differentiate it from the rest of the day’s headlines. Within the sponsored section, a red stripe proclaiming SPONSORED CONTENT in small white text separates The Atlantic’s menu bar from the paid-for post’s headline.
If the publisher is Boston.com and the advertisers are local businesses…
Thomas F.X. Cole, the Executive Director of Business at Boston.com and The Boston Globe, has seized an opportunity for sponsored blog posts from local businesses on Boston.com. As he said to Ad Age’s Nat Ives: “Our advertisers and particularly our smaller advertisers have been creating their own content. They need to get it exposed. As much as 50% of small businesses are blogging. The one thing they want is to have people see their material.” Here is how it works:
In this case, too, church and state are firmly divided. “Insights,” as the sponsored posts are called, are in a box outside of the main column of headlines, in different font, and under the label: “Special Advertiser Feature.”
If the ad agency is Sharethrough and the product is Sour Patch Kids...
San Francisco-based native ad agency Sharethrough specialises in sponsored videos for brands that are “equal in intellectual value to ‘real’ editorial on a publisher’s page,” rely on a “choice-based interaction” whereby the user clicks on them very much on purpose, and are visually integrated into publishers' websites. I do not know on which publisher's website (if any) the above clip has appeared or how transparently it was marked (I found it via Sharethrough's site). One publisher that the agency has worked with, though, is Forbes; indeed, Sharethrough and Forbes Insights put together a joint 18-page report on native advertising entitled “Going Native.”
Will native advertising become a common source of revenue for news organisations in the near future, as it already has for several social networks? Perhaps, but there are some complications, even beyond the the many-shades-of-grey question of how integrated is too integrated.
One is scale: creating such content is costly, labour-intensive, and usually requires a partnership between a brand and one publisher; and the finished product does not lend itself well to being run across several different websites. For publishers, additional challenges include the figuring out how best to valuate and charge for custom content, as The Atlantic’s Publisher Jay Lauf has expressed, and the difficulty of striking when the iron is viral, as BuzzFeed has found.
On the bright side, they can bring in a lot of pennies. BuzzFeed, for instance, currently charges $8,000 per day for the slot to the right of the main headline—a price that will increase to $10,000 per day in 2013 due to growth in home-page traffic, according to Ad Age. The stories that fill this slot are visually distinct from the rest, and have headlines like, “13 Animals Who Know It’s Business Time.” From the user’s perspective, let’s be honest— invited or not, he'd be great fun at a party.