Native Advertising: Does it work?

There seems to be a new digital era of so called 'native advertising'; but what even is 'native advertising'? Its defined as a form of paid media where the ad experience follows the natural form and function of the user experience in which it is placed. The essential components of this are the form: being that native ads must match the visual design of the experience they live within, and look and feel like natural content; and its function: being that native ads must behave consistently with the native user experience, and function just like natural content. This can be shown in the picture below:

We've all seen them, they're those annoying 'Suggested Posts' on Facebook and the 'Sponsors Stories' on Twitter, that we all look past without batting an eyelid. In fact Online Media Daily  worked out that 60% of customers don't remember the last display ad they saw and Solve Media, an advertising consulting company, worked out how much more likely we are to do the most statistically unlikely of things rather than click on one of these display ads: "You are 279.64 times more likely to climb Mount Everest...and 475.28 times more likely to survive a plane crash than you are to click on a banner ad".

So the question now must be, does this advertising even work?

•   Well looking at the facts it seems they do work to an extent, with 99.8% of the usual banner ads being ignored, but native ads being looked at 52% more. Also seeing as their main aim is to increase sales, looking just at how much they get clicked on is not enough to prove whether they work or not, although a native ad play by car maker Mini Cooper on Buzzfeed resulted in a 33 percent brand lift. Here the facts speak for themselves, showing how effective native advertising can be.

• 17 of the 25 ads on Native Ad Leaderboard  are hosted on Buzzfeed. Although this isn't surprising as Buzzfeed's revenue is entirely dependent on native advertising and brand can easily integrate with its simple content model. A great example of this is Pepsi's Ad of '10 Beautiful Places In The World That Actually Exist', where users had to 'like' Pepsi on Facebook to be able to see these places. This created 1 million interactions although this did take 19 months for it to become so popular. Content like this drives user engagement, giving brands 'the opportunity to weave their brand message into customers' natural discovery habits' whilst they browse online (Horan, 2013).

• Also comparing native ads to the current banner ads, which are the the ads placed in the upper right hand corner of the page, rather than integrated in the text. Native ads are believed to be more visually engaging than banner ads with consumers looking at them 52% more and they're also believed to drive higher brand lift than traditional banner ads (Native Ads v Banner Ads), as shown in the image below. This all contributing to banner ad click through rates dropping from 9%in 2000 to 0.2% in 2012.  
  

• However negative attitudes towards native advertising has also been recognised. For example in the first picture of the Suggested Stories on Facebook above, it is believed that these have contributed to a decline in overall Facebook users. Also these ads are believed to have little targeting as to who the audience is and therefore meaning that eventually users will become bored of these in the future.

So the question would therefore not be whether Native advertising works because it clearly is the best type of digital marketing at the moment, but how will it continue to work? 

There is the fear that native advertising will become boring and obvious to the user in years to come, but as long as long as the content is interesting and makes the reader feel they are benefitting from reading the content, then native advertising will continue to be a successful marketing tool for brands.