Native Ads – Promises and Challenges

Quartz, a news site with a refreshing reading app like design has been making a lot of buzz recently. The design is optimized for all devices and unlike any other news website, Quartz shows only instream ads.

There is no noise of ads when you are looking at content and when you look at the ads, there is no content to distract you. You will see a glimpse of this layout in Indian news site scroll.in, the ads are still to come though.

Instream ads–you must have seen them on Facebook’s tablet/mobile app when sponsored apps show up for download between regular posts. An advanced version of this is the Native ads. Native ads are not only placement driven, like instream ads, but also have the same design as the atomic content unit on the platform. It looks like any other piece of content on the site, just promoted harder.

One of the biggest successes of native ads is the growth in Facebook’s mobile device revenue and other being the Outbrain’s widget for related/featured content that a lot of blogs and news sites use.

We have seen a hack of native looking ads when publishers try to optimize the aesthetics of Google text ads to make them look similar to content of site, in terms of color/font size/font face. Some tech blogs and how-to forums have seen huge upsurge in CTRs with such camouflaged ads. We, at FindYogi, tried something similar but the results weren’t encouraging.

What’s so great about native ads?

1. Device agnostic – A lot of publishers complain about mobile and tablet traffic not being monetize-able like desktop ones. A lot of this is because mobile/tablet doesn’t have any space for obstruction, hence a little to no ad inventory, that is visible.

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2. Branding – There have been enough debates about Internet not serving as branding medium for marketers, and only good for conversions. The trust of platform that native ads bring will be a lot more valuable for marketers looking to build brand on the web.

3. 100% Visibility- There is no way for a user to ignore a native/instream ads. One has to go through it before ignoring it.

4. High value content will be even more valuable–Native ads will mean the CPM metrics will be popular again for inventory buyers. The guaranteed visibility of ads means more trust between the publisher and advertiser. When the trading metrics go beyond the CPC, the focus will be on high value content that users engage with.

What is the challenge for native ads?

The major reason for growth of traditional banner advertising on the web has been the ease of trading of ad spaces. There are standard ad sizes that publishers and advertisers adhere to. There are standard metrics to follow in terms of performance. Thanks to Google’s Adsense program and related tools, small publishers can be part of this network from day one.

Each publication is going to be a different ball game when it comes to native ads. Imagine Twitter’s promoted tweets vs. Facebook’s sponsored posts, very similar yet altogether different. Small publishers cannot afford to have dedicated sales team. Optimizing inventory at such small scale is not feasible for publisher or advertisers. So, an ad network is definitely required.

As the diversity of platforms and content type increases, an honest measurement of visibility of native ads is going to be a challenge. The ad networks will need to go beyond number of requests and look into engagement time on screen. Such scrutiny will need to go beyond app and might need a device level control. So, is there a game beyond here for anyone other than Google?

The only way to crack this space is to bring disproportionate amount of revenue for publishers in the initial days. In India at least, we have seen a market where second ad networks have had negligible impact on publishers. The reasons range from non-predictability in terms of payment amount and schedule to low/no targeting abilities. Most ad-networks are more about out-sourced sales team than optimized automated systems.

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(About the author: Naman Sarawagi is the founder and CEO at FindYogi.com. He is a consumer web entrepreneur with focus on understanding consumer behavior and using that insight to build usable products.)

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