Opinion: Understanding Native Advertising in the context of 2021

Pankaj Jain from Httpool decodes Native Advertising - benefits & results in addition to the trends he foresees in 2021.

“Don’t trick them. Don’t piss them off.”

Brands love native ads; it gets more click-through rates and revenue per impression because of its organic nature. Still, it’s also considered one of the most controversial forms of communication. 

For those unaware, we, as consumers, have been consuming these native ads and the reason without understanding their real nature. Native ads are designed both editorially and design-wise to blend with the publication style where it’s going to be featured. These are similar to the content ads because the revenues are based on the number of clicks.

How many of us have clicked on the ads which appear on the top of Google search? Almost, always right? Social media platforms like LinkedIn, Facebook, and Instagram have also adopted native advertising, and companies like Taboola, Outbrain, and many others only deal in the same. The reason that native advertising is considered controversial because it is at the risk of breaching the trust of the audience, but before commenting on that, it’s essential to understand how native ads work. 

Outbrain suggests that consumers look at native ads 53% more than display ads and have more than 18% chances to influence the purchase intent with visual engagement.

Another reason why brands prefer native advertising is because it breaks from the monotony of ad fatigue. 

Thanks to cookies, we are surrounded by ads everywhere, which can often irritate the consumer. Still, native ads cloaked within organic content are more relevant and exciting and keep the attention span high with engagement. 

Serve Native Ads to Targeted Audiences

A recent study on advertising at Stanford suggested that consumers today are more educated and are not being fooled but are aware what they are viewing is an ad. While this might have impacted the purchase behavior, consumers also know how to make the best use.

So, how can brands make the best use of these learnings? The answer is programmatic native advertising, which means serving native ads to targeted audiences. Programmatic native advertising enables brands and businesses to optimize ROI-driven ads using programmatic auction of ads. And this is what is believed to form the basis of digital spending in 2021.  

With the transition, brands are now seeking digital platforms, showing that the advertising trends have also changed.

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Aninda Gupta, Marketing Lead, Media & Digital, Saint Gobain, Gyproc India believes, "In  2021, which is still adapting to the fallout of 2020, the overall digital spending is expected to rise by 34% annually across the globe.”

Talking specifically about native advertising, Shibu Shivanandan, Founder & MD at PivotRoots, says, “Audio content opportunities are emerging more so now and can disrupt the advertising trends.” This represents an incredible new opportunity for brands to reach out to their audiences through audio channels.

Forecast for 2021

I believe that the shift from static to programmatic media buying will be an excellent win for brands.

Some of the trends we foresee in 2021:

• Overall digital spending is expected to grow at a yearly rate of 34% globally. While Video ads dominance will continue for another five years, especially for creating awareness, Native ads will see tremendous demand from marketers and dominate across all the other user journeys for a brand.

• Native ads on social platforms will be the key growth driver for native ads. It will be well supported by artificial intelligence and user preferences.

• The recommended widget-led native ads market share will grow further as more publishers move away from traditional ad placements. Primarily because the revenues per 100 impressions that native ads fetch are much higher than other ad formats.

• Use of Google Search native ads will continue to be used more out of need than a want. While this type of native ad spend is expected to grow, it will not be dominant compared to the others.

Finally, marketers know that adopting an open-minded and flexible approach makes them more successful. Don't be afraid to try various channels, audiences, and content pieces and find your best performance areas. 

And so, as we move well into the post-pandemic year, native advertisers should bear in mind the sophistication of their audiences, design targeted campaigns, and follow through with open-mindedness, creativity, and flexibility for greater results.

Thus piece has been authored by Pankaj Jain, Partner Director, Native, India & SEA, Httpool.