Native Advertising 101: Understanding the native continuum

Gigaom

“Native advertising” is a term you’ve probably heard a lot lately. It’s come to embody a set of advertising approaches that look to integrate advertising more fully into the digital content experience. Sponsored content on Buzzfeed, “brand stories” on Facebook, promoted trends on Twitter — all of these are commonly cited examples of advertising gone native.

But publishers and brands looking to incorporate native ads into their portfolio often have a poor understanding of the “native continuum” — the gradient that exists between a classic banner ad and a fully native one. While all forms of native advertising What are the key differences? What types of ads exist along the continuum? And, most importantly, what are the benefits and drawbacks of each approach? Here’s a guide.

The tourist ad

Far from being a true “native,” the “tourist” subtype is just a step up from a standard banner ad. Think of it as the digital evolution of those massive fold-out sections in the Economist that governments sometimes buy to encourage foreign investment. Here’s an example from the Atlantic.

Tourist ads…

  • Are “super” banners. This is functionally a banner ad on steroids, with a well-conceived layout and expanded size.
  • Are multi-faceted. Note the simultaneous usage of video, imagery, and text used in this example. This is a common feature of “tourist” ads.
  • Actually contain useful content. These ads offer actual perceived value to the reader, in the form of content that goes beyond “check out this product” or “laugh at this GIF.”
  • Offer some inherent social functionality. While not ubiquitous in tourist ads, this ad has incorporated commenting and voting functions, further encouraging user engagement.
The resident ad

Resident ads move beyond tourist ads by integrating themselves more fully into a website, intimating that the unit is part of the site’s content. Here’s an example from Outbrain that appeared on CNN.com.

Resident ads…

  • “Dress the part.” Resident ad networks build units that can be easily modified by the publishing partner to look like part of the site’s core content layout. Outbrain’s unit, for example, looks like a natural extension of the site’s navigation. And users may not realize it is served by a third party.
  • Have new placement. Rather than try to fit into a site’s content model, resident units are often new types of ad units, often using the space between paragraphs or at the bottom of articles to surface their content. Outbrain’s done this at the bottom of the article.
  • Include local and third-party content. Resident ads often aim to provide value by simultaneously surfacing relevant content from both within the publisher site, as well as within a larger network. Outbrain’s tool is a terrific example of this.
The citizen ad

Building upon the local content alignment and nascent design “camouflage” begun by resident ads, citizen ads begin to further embed themselves in the flow of content. Here’s an example from Entrepreneur‘s website.

Citizen ads…

  • Match the site’s style. Similar to the resident ad, the citizen ad fits the style of the surrounding content and layout perfectly.
  • Are included in consumption experience.  The user encounters the ad as an extension of his or her core browsing experience, not as separate content.
  • Are core content objects. Even beyond the resident ad unit’s integration into the content experience, this citizen ad is actually being presented as a core aspect of the content experience.
The truly native ad

Truly native ads offers the best of both worlds: Content that users can readily identify as sponsored (as with tourist ads), but that is easy for them to engage with. Let’s use Facebook’s “sponsored stories” as an example.

Native ads…

  • Share functionality with non-ad content. On Facebook, sponsored stories can be shared, liked, commented upon, etc. This is a critical element of native ads.
  • Look the same as other content on the site. Facebook’s sponsored stories look no different than other posts in your feed, save a bit of highlighting for emphasis.
  • Are included in the consumption experience. In our Facebook example, these sponsored stories actually appear in your feed, right alongside your normal updates.

Across these different native frameworks, one thing is consistent: Native ads frequently perform better than banners on key metrics (e.g. click through rate), often by a lot.

Despite that, native CPMs aren’t much higher than CPMs on banner ads, at least for now. That’s not totally surprising — native ads are a relatively new format that can be challenging for marketers and media planners to justify internally. But advertisers should take advantage of the divergence between impact and pricing: It’s a significant inefficiency in the market, and they can exploit it while the publishers catch up.

Jonathan Glick is the CEO of Sulia, the subject-based social network. He was previously head of research operations for the Gerson Lehrman Group and ran digital product development for the New York TimesJosh Neckes is the VP of revenue at Sulia and a strategic consultant for early-stage tech startups.


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