Consumers and Marketers Going Opposite Ways on ‘Native Ads’

Sponsored content

It may sound naive but it’s not entirely clear to me why online advertising has become such a “cat and mouse” game — putting consumers and marketers in such antagonistic positions. Ads can in the best of circumstances be useful and even entertaining (see the Super Bowl).

Most of the time, however, they’re neither.

Paid search has managed to generate massive revenues by matching user intent and being relatively unintrusive. In traditional media, newspaper circulars are still “read” with enthusiasm and interest by selected audiences. Coupons are very effective and extremely popular. Print yellow pages, an earlier version of the search model, was full of “content” that was almost entirely advertising.

Online display advertising, in contrast, has a history of struggling for attention. Display has compensated through increasingly aggressive use of data and targeting. Many online consumers, perhaps wary of such data-collection practices, are increasingly seeking to block or avoid marketers online.

Survey Do Not Track

Source: Communispace

Native advertising or sponsored content, a euphemism for what used to be called “advertorial,” is increasingly seen as one viable response to consumer ad indifference or avoidance. BuzzFeed just raised $50 million against an $850 million valuation partly on its sponsored content model.

A majority of marketers have embraced at least the concept of native ads. A recent survey of 400 digital marketers by 614 group found that 69% believe native advertising is “valuable.” Yet nearly the opposite is true for consumers. As previously reported, a 2014 survey by Contently found a majority of consumers disapproved of sponsored content.

Part of the reason that native ads may be “working” is because consumers don’t immediately recognize them as ads and confuse them with actual editorial content. That’s part of the point. Marketers protest this accusation by arguing that they’re not trying to confuse or deceive anyone.

Yet fundamentally consumers don’t trust most forms of digital advertising. Once they understand something is an ad they’re much more skeptical and critical. This is why native ads seek to blend in and do the legal minimum to call attention to themselves as ads.

By my informal observation, nearly one in four “stories” appearing in Yahoo’s news stream is sponsored. One has to pay close attention to avoid clicking on them.

There’s no reason to believe that consumers will warm to sponsored content unless it becomes better and more prominently labeled as advertising. My view is:

  • Disclosures must become more obvious and clear to avoid confusion
  • The ad placements must become more directly and contextually relevant (travel ads in a travel context), which may sound like a contradiction of the above statement
  • They need to be less like conventional ads and more genuinely informational and interesting

Much of the sponsored content I’ve come across is perfunctory or bland or just bad. Yet good “content” is expensive and most marketers aren’t that interested in being thoughtful about their advertising. They’re relying on targeting and data more than improving the creative.

There are certainly exceptions that we can point to but in my experience most marketers simply want to put their existing ads in front of consumers in new ways that aren’t so easy to avoid. But that’s not going to work over time.

Most people by now have seen comedian John Oliver’s epic takedown of native ads. In the event you haven’t here it is:

Image via BuzzFeed.

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