Native advertising is experiencing meteoric growth. Business Insider projects that spending on native advertising in the U.S. will surge to $21 billion by 2018, about five times the spending level of 2013.
Marketers are flocking to native ads — particularly in-feed ads, like you see on Instagram, Twitter, or with Sponsored Content in the LinkedIn feed. These are attractive to marketers, because they are unobtrusive: they appear in the content stream that prospects are already consuming.
Native ads are attractive for two other key reasons. First, in-feed ads have helped crack the code on mobile ads. In-feed ads fit perfectly into the flow of mobile content consumption. Second, new technology, like that pioneered by Sharethrough, is enabling the programmatic buying of in-feed native advertising.
For LinkedIn’s new ebook, “Native Advertising: What It Is. How to Do It,” we interviewed Dan Greenberg, CEO of Sharethrough, to get his take on the critical role native advertising will have on the future of digital marketing. An edited version of that interview appears below.
Q: How do you define native advertising?
Native ads are a type of paid media that fit the form and function of the user experience on the site or app in which they’re placed. In short, they’re ads that fit in.
Native ads are indeed paid placements (“ad units”) but unlike the fixed-size boxes we traditionally think of as ads, native ads are made of component parts (a headline, a thumbnail, a brand name, a video, a few lines of text) that assemble to fit in naturally to whatever user experience they’re rendered within.
The most prevalent form of native advertising are in-feed ads, ads that fit inside a feed of other stories and content (think LinkedIn, Facebook, Buzzfeed, New York Times, etc).
Note that the creation of a piece of branded content is not itself a native ad. It’s when a marketer pays to promote that post to get it seen by users that makes it become a native ad.
Q: Why is native advertising so effective?
Effective advertising uses deliberate persuasion strategies to influence behavior change. When people are pulled away from what they’re doing, or forced to stop and change context, it’s much harder to trigger action. Traditional advertising works, but only on the people who are willing to be interrupted.
The magic of native advertising is that because it fits in naturally it trades off of earned attention, not forced attention. When a user proactively chooses to stop scrolling in the feed and read a story, ad effectiveness goes through the roof, as measured by engagement rates, brand lift, purchase intent, and overall cognitive activity.
People see banner ads peripherally, but people truly read native ads. And primary attention will always trump peripheral attention.
Advertising trades off of attention. Traditionally, ads have been foreign objects placed unnaturally around a user experience — and while forced attention works, earned attention will always be more valuable.
The magic of native advertising is that because it fits in naturally, it trades off of earned attention not forced attention. When a user proactively chooses to stop scrolling in the feed and read a story, ad effectiveness goes through the roof, as measured by engagement rates, brand lift, purchase intent, and overall cognitive activity.
When ads fit in, everyone wins
Q: How does native advertising fit in with the modern marketing mindset?
Advertising and marketing is traditionally taught as “the art of war,” with targeting, conquesting, and beachheads. We like to say at Sharethrough that modern marketing is not about the art of war—it’s about the art of syndicating the truth.
Great marketers find and create true stories about their brands and products, and then use native advertising to promote those stories to the people who’d be mostly likely to care. Whether those “true stories” are videos, articles, blog posts, or product reviews, the common thread is that they’re not ads designed to be skipped, but they’re actually just normal content. And that advertising content is often as good as or better than the non-advertising content surrounding it.
Conceptual example here: let’s say I’m Intel and I’m trying to build awareness and interest in my connected devices partnerships with Oakley and New Balance through native advertising. I’m not running banners with our collective logos in them — I’m finding the articles and writing the stories that explain our new partnerships and then I’m promoting those stories through paid ads into the feeds of tech and gadget and news sites.
The role of the marketer has changed in a meaningful way. Instead of the marketer saying “I need to push, push, push,” they’re saying “I need to discover the truth about my product, identify the best use cases, find the customers who love it — and then just tell that story through content."
Q: What is Sharethrough’s role in the native advertising realm?
Sharethrough is the white-labeled technology platform that most premium publishers like US Magazine, Esquire, Men’s Health, The New York Times, and ABC News use to power their own versions of native ads. We’re by far the largest independent company serving in-feed native ads. Facebook, Twitter, YouTube, Yahoo and a handful of mega-platforms have their own homegrown native ad platforms — we power the native ads for the rest of the web.
Publishers use our “supply side” platform to manage a full stack of native monetization: directly selling native ads to advertisers, selling native ads programmatically through our open exchange or private marketplaces, or by using our technology to manage all of their ad network partners.
The following Q&A was originally run in LinkedIn's new Native Advertising eBook, “Native Advertising: What It Is. How to Do It,” which is available online.