Mobile native ads, or sponsored content that adopts the user experience of a publisher, is just a new spin on an old concept, advertorials. But the recent explosion in adoption of the format by both publishers and advertisers shows that its time has come. For publishers, there are many benefits to incorporating native advertising into an app such as, providing a better user experience and increasing engagement rates, which will result in better CPMs. When exploring adding native advertising options for your app, here are five things to consider:
Select a sponsored content format that works best with your product
Some apps like Facebook offer advertisers the ability to sponsor news feed posts, while photo sharing apps like Instagram offer advertisers sponsored photo posts. Commerce apps such as Gilt or Ebay offer merchants a featured listing post that's very prominent in a specific category. Each app's unique user experience lends itself to a different native ad format. It's important to understand the user experience and offer something that will create value for both advertisers and the users.
Many apps have some kind of news feed, which makes it easy to develop one of the most popular native ad formats, by simply offering a sponsored news feed post. If your app doesn't have a news feed, a bit more creativity is required. Some good examples of non-news feed native ad formats include sponsored groups or channels, sponsored rooms, pages, or a sponsored playlist for music apps.
Native ads perform better and bring higher CPMs for publishers
Recently, a few studies have tried to quantify native advertising performance versus banner ads. One study found users were 25 percent more likely to look at a native ad than they were at a banner, and that they looked at them 53 percent more frequently. The same study also found that users were much more likely to share a native ad, which is a huge benefit to the format. And given the higher engagement rates, incorporating native ads will impact a publisher's bottom line significantly. Here is an example:
- Mobile banners: $.10 CPC on a banner ad gets 0.5 percent CTR = $0.5 eCPM = $5,000 net payment to the publisher if served on 10MM views.
- Native ads (averaged over native ads publishers): $.30 CPC on a real piece of content gets a 2 percent CTR = $6.00 net CPM = $60,000 net payment to the publisher if served on 10MM views.
Tap into RTB native demand to expand monetization efforts
For publishers, RTB marketplaces offer great opportunities to capture demand that extends well beyond the reach or expertise of an in-house sales team. New technologies allow advertisers to scale programmatic ad buying and put relevant ads in front of consumers based on real-time data. Now that native is coming to many exchanges, you can tap into programmatic demand for that format in addition to banners.
With more demand now migrating to exchanges, and the targeting data layer becoming larger and more robust, advertisers can access unique opportunities to reach consumers. Another benefit of programmatic demand is that it allows a publisher to scale direct sales efforts by using RTB as the delivery method for direct buys. RTB platforms generally have better campaign management and targeting capabilities that will improve a publisher's workflow and campaign delivery.
Be sure to provide analytics and reporting tools and incorporate viral lift
Helping buyers understand the total value of your native ad offering is key in scaling demand. Viral sharing and engagement numbers should be incorporated into the full analysis for customers, to help quantify the success of the campaign. For example LinkedIn does this by combining all shares and clicks into a single engagement number in its campaign reports. Facebook also does something very similar. Because viral lift from sharing can be significant, a publisher wants to make ad buyers aware of its impact on its campaigns. Providing metrics that quantify this unique aspect of native advertising will go a long way in helping create long-term value for your advertisers. It also clearly demonstrates the unique value native ads have and increase differentiation.
Don't forget to label sponsored content clearly, the FTC is watching
The FTC recently held a meeting specifically on native advertising and while no official labeling guidelines have been agreed to for native ads, the FTC did use the meeting as an opportunity to remind publishers that existing guidelines require all publishers to clearly label any native ad content as sponsored. How this is done is still up to the publishing platform. Google now simply uses the word "Ads" above its sponsored links, while Facebook labels its native ads with the term "Sponsored Post." Even clever publications like The Onion have a section called "Special Coverage" that contains articles marked "Sponsored By." Terminology, size, and wording are still all up to the publisher at this stage. What's most important is to label the sponsored content appropriately.