Monetizing Right with Native Ads

Native advertising promised to be the savior of online and mobile content monetization, and the natural evolution of digital advertising. But only if you did it right. So is it worth the risk for YOU?

Many old-school publishers and journalists cringe at the very mention of native advertising. It’s often perceived as a “cheat” or “hack” and can often times be misleading because the ad is camouflaged in the editorial content. Some even claim it’s native advertising that’s killing journalism.

You might be cringing right now, and that’s okay. However, with major publishers like BuzzFeed, New York Times and the Washington Post monetizing with native, it might be time for you to re-think your approach.

Even Apple is hopping on the native train with sponsored content in its News app feed and the naysayers admit it’s too late to turn back.

Slowly but surely, native advertising and content marketing budgets of brands are growing to overtake display advertising budgets. So if you’re not there yet, you might be missing the party.

Believe it or not, you do not need to sell your creative soul to the corporate devils to make native advertising work for you.

What is native advertising?

There’s a surprisingly large spectrum of definitions for the term, but we’ll skip that debate. The most basic definition is:

paid content that matches a publication’s editorial standards while meeting the audience’s expectations.

Long before native advertising there was “product placement.”

Technological innovation expanded the capabilities of product placement to computers and mobile devices but the main principles remain the same.

native advertising examples

Before you jump on the native bandwagon you should know that native ad networks haven’t been around for as long as display ad networks and publishers and advertisers alike are finding it difficult to find a formula that works, which isn’t easy considering how fast that market is changing.

Campaign managers will tell you that their optimization, analytics and targeting options are still pretty limited and not quite as effective, when compared to the display networks. That’s why,

 

Doing native advertising effectively requires creative skill and can be very rewarding but getting it wrong can be devastating to your business. Even more devastating than getting display advertising wrong.

lumascape-content-native advertising

Your audience can abandon you, and the FTC can come knocking with fines. Neither of those sounds like much fun, so let’s try to avoid them.

If you’re too scared to keep reading, and have already decided against native advertising? Don’t be. Because the risk is usually worth it. If you do it right.

Is native advertising worth the risk and investment?

The answer to that question depends largely on your percentage of website visitors using ad blockers, and the performance of display ads and other monetization sources (like affiliates).

Generally speaking, it’s always a good idea to diversify your revenue sources. The thing about native is that you have to be very calculated and smart because you’re risking your reputation as a publisher.

native-ads-vs-display-ads-effectiveness

How to monetize native ads effectively

I wrote this already, so I might be repeating myself a bit but it’s worth saying again. If you don’t plan and execute your native advertising inclusion strategy correctly, it can kill your business and cost you.

We’ve collected tips and suggestions to help you evaluate your native advertising options and execute it without glitches.

  1. Balancing the mix

The most common advice (and the most obvious one) you’ll get about native advertising is to find the right balance of native ads to “real content.” Too much native advertising is bound to upset your users and distance your advertisers.

You don’t want to run a CPC farm with mostly sponsored articles. What you want is paid content that seamlessly blends into your publication not only in appearance, but in writing style and topics. If it doesn’t bring your readers value, they’ll leave. And the advertisers will leave with them.

keep-calm-and-try-native

An important component in the native advertising mix are content promotion platforms like Outbrain and Taboola. These can bring you traffic (more on that later) or they can drive it elsewhere, for a fee.

These content recommendation widgets pay but also send your hard-earned users to other blogs and publications hosting the suggested content. This is especially true with mobile, where users don’t open a new tab but just move on to the next page, wherever it may be.

Oh yeah, and don’t forget about your display ads. You shouldn’t give up on those, especially since in many cases they can be displayed alongside advertorials.

  1. Keep the feed clean

One of the native advertising ad units that has been popular for quite a few years is the in-feed ad. These basically use in-stream real-estate to display ads that look like the “regular” content one would expect to find there.

Think Facebook and Twitter in-feed ads.  Although these get a lot of the attention from users looking for content to click, they are also very likely to annoy people. In our experience, what works for social networks will not always work for a digital content publisher. And we have the case study to prove it.

Our recommendation? Avoid in-feed ads. And if you can’t help it, measure and analyze carefully.

BuzzFeed_Native_Advertising_Example

  1. Mobile, Mobile, Mobile

Monetizing mobile traffic is a little like getting water out of stone. It’s hard, but darn impressive if you manage to pull it off.

According to the Mobile Marketing Association’s research from 2015, mobile native ads perform up to ten times better, and earn three times the attention than display ads. The research also claims consumers prefer the mobile native ads, which earned 23 percent higher ad quality scores than mobile display ads.

Seems logical, right?! Not so fast. Other studies have shown that native may get more clicks, great for us publishers, but drive few sales, bad for advertisers.

Naturally, as the glow on native’s freshly polished aura starts to fade advertisers will gravitate back to the ads that drive sales for them, i.e. display ads and search ads.

Wrong again, native ads are beginning to find their niche with marketing execs. And campaign managers as a format that supports and boosts display ad sales, which makes them into a great one-two punch. Especially on mobile devices. We’ll get more detailed in the next section.

Unlike the desktop where we multitask and have multiple tabs and applications open, the tiny mobile screen can only contain so much content. So native mobile ads capture all the attention when displayed and drive consumers further down marketing funnels.

Deciding on the quantity and type of native advertising on your digital properties depends heavily on traffic sources and audiences. If you have a lot of mobile web traffic you’re having a hard time monetizing, native advertising might just be the component missing in your mobile monetization strategy. The one that’ll turn rocks into brand-sponsored bottles of mineral water.

  1. Keep it fun, close, and personal

When it comes to advertorials and product placement, you want as much control as possible over the content. Sure, you can let the brand content people write the text or create the video. But how much will that content fit with your publication “voice” and perception? How much is this control worth to you?

Since the point of your content is to interest, entertain, and educate your website visitors, it’s important to keep it informative and fun. You know how to do that already – it’s why you do what you do.

Remember to do the same with advertorials and product placements. It’s not that hard – just let the creative juices flow and don’t forget to charge the advertiser for the hard work (and/or hard liquor).
native ad content so good

You can take a page out of the books of The Onion and BuzzFeed who’ve managed to incorporate native advertising while keeping it fun, amusing and fun to read and share.

the-onion-native-ad

  1. Analytics & Segmentation

For marketers, one of the main challenges of native advertising is measuring results. They like numbers just as much as we publishers do, if not more.

A Business Insider Intelligence report from 2015 claimed that desktop native ads have an average click-through rate (CTR) of 0.15 percent. While according to Google, display ads average a CTR of 0.06 percent.

But native ads are much harder to quantify into revenues. This is one of the reasons many native ads aim to increase brand awareness, rather than promote instant sales.
Metrics-used-to-measure-native-advertising

Since brands and agencies can’t precisely measure content marketing success, they rather just aim well. Advertisers and agencies are looking for well segmented audiences that match their demands. What this means is that you want to be able to offer as much information describing the audiences as you can. Having a loyal audience of subscribers helps a great deal.

  1. Don’t be a cheater: Sticking to FTC guidelines

We’ve already established that native ads attract more clicks than display ads. But the problem starts when people don’t know they’re clicking an ad, or can’t tell an ad from editorial content at all. This isn’t only frustrating to users, but also misleading and somewhat illegal.

live dangerously

If you’re advertising in the US, or your advertisers are American companies, we strongly recommend you familiarize yourself with FTC guidelines for native advertising.

The TL;DR version is basically don’t be an a**hole. Mark sponsored content as such, provide full disclosure and respect your audience.

  1. Content recommendation networks

One of the main challenges in getting started with native advertising is pricing it right. With sponsored content, it’s hard to put CPC or CPM in price quotes and most advertisers expect a flat rate.

In many cases, it’s a good idea to package native ads with display ads, exclusive promotions and other tools, according to the marketer’s needs. Remember not to under-price your native ad-space. With display ads the content copy and creation are in the hands of the advertisers.

Here you need to put in the work into creating this content and sometimes in promoting it on various channels.

With advertising it all boils down to ROI and like display ad networks we also have native ad networks or content recommendation networks. These are widgets you can place on your website that recommend other content creators’ content. You get paid for click or 1,000 impressions in the same way you do with display ads. The difference here is advertisers are not advertising a product, they’re advertising content to web visitors who are in the process of consuming content. Pretty smart, eh?!

Taboola, Outbrain and others promote sponsored content articles on your site for a revenue sharing fee. As with display networks, you’ll have a myriad of advertisers fighting for your native ad inventory and you could garnish a pretty plump check at the end of the month.

  1. The “nobel native”

Don’t sell your soul to native. Develop partnerships with brands and agencies that reflect your publications views and your audience’s interests. If you have a blog about makeup, having an advertorial by a funeral home is not worth any kind of money they’d be willing to offer.

It’s just wrong. Make sure that the brands you openly support as sponsors are right for you, and right for your audience.

These relationships will demands investment on your part and constant cooperation. You want to understand the advertiser, and you want the advertisers to see value for their money. Ask a lot of questions, and keep them as involved as they want to be, as long as it doesn’t clash with your editorial guidelines.

Going native

There’s still a lot missing in the native advertising puzzle to make it a perfect picture. Although users generally prefer it to display advertising, it’s still a hard sell with brand marketing execs. They want to see measurable results, and in many cases native advertising doesn’t deliver.
As native advertising evolves, it begins to merge with technologies like RTB (real time bidding) and programmatic buying of native ad space. With better targeting and segmentation, as well as analytics and reporting tools for all – native advertising will become the standard, and a must-have component in the marketer’s sales funnel.

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I’m Head of Marketing Operations at AdNgin. Before coming to AdNgin, I was a marketing professional focused on SAAS business models. When I’m not working, which is rare, I sail and hang out with my son, Jonathan, and wife, Meital.

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  • Even more important than ever i think, to present good content on a well designed (simple) site, and build, build, build. What will matter – increasingly to advertisers, is space on a site that delivers. Maybe just a tad ignored by many. Stop chasing money; seek and keep visitors. That surely must be the basis – unless you are happy with coffee money! Build a content-rich informative site that engages – such a hackneyed phrase, and rightly so.
    THEN you can really start thinking more seriously about publishing.

    • Hi David,
      Thanks for commenting. You’re absolutely right. If you want to run a sustainable operation then you need to start thinking about developing a website that can create a real and loyal following. This kinda relates to our simple but effective formula, RPM x PPS, for optimizing web/web-mobile monetization.