Advertising Technology

Toward (Re)Defining Native Advertising

Fahad_OnePublic_260

This column was written by Fahad Khan, Founder and CEO of One Public, a cross media digital marketing software company based in New York City.

The definition of “native advertising” that is loosely or tightly associated with content marketing is flawed and misguided.

I had stressed the need to define native advertising at an IAB MIXX session on the subject, last year. Deanna Brown and Chris Cunningham facilitated that session. Randall Rothenberg, CEO of IAB, was also a participant in that session.

In his blog piece on HBR, Mitch Joel was the first to raise the question on the need to re-define native advertising. He laid the foundation on which I build my argument.

Here is the definition I offer:

Native ads are ads in a format that is native to the platform on which they are run, bought or sold. Native advertising is the activity of producing, buying and selling native ads.

This definition is universal and extends beyond the digital realm.

Prints ads in newspapers and magazines are native ads by definition. Print ads were as revolutionary in 19th century as Google AdWords were a decade ago. Printing press allowed the ability to print content on paper at scale for the first time in human history and ads were a natural – err, native – part of it.

Radio commercials are also native ads. Radio ads have a format, voice, which is native the radio platform.  TV or video-over-radio in 1950s and 1960s has a same story. TV commercials are video in format and therefore native to TV.

Most outdoor ads, particularly billboards, are non-native ads as they are not native to the environment they are placed in.

Debate on native advertising is not crucial for traditional media as it’s not going to have an impact on how traditional mass advertising works. But it is important to include traditional media in the debate to solidify the concept and the proposed definition of native advertising.

Below I cover major silos of digital advertising and their native advertising qualification.

We started off digital advertising industry on a wrong footing by applying print ad format to the Web.  All display advertising is non-native.

Google AdWords were the first form of native ads on the Web. When you search on Google or Bing your input method is text. Results are also text and hypertext links to what you are searching for. Paid search ads are placed before results in exactly similar format but with clear indication, “Ads related to… ”.

Contextual ads in Gmail are non-native. Gmail is an email platform and ads you see there are not email in format. If Gmail started sending you paid-emails — Facebook has started to do this pay-to-message service — that would be a different story.

Initial form of ads on YouTube videos were contextual text ads similar to those in Gmail and therefore non-native. Recently, YouTube has aggressively started to push pre-roll video ads – a gigantic move to native ads and it is working well.

Majority of the Facebook ads that show up next to your profile page qualify as display non-native ads. Sponsored Stories and all types of ads in the Newsfeed are native. The content in Facebook Newsfeed is multi-format. Therefore, by definition, any format of Newsfeed ad qualifies as a native ad, including the upcoming video ads.

Traditional SMS driven mobile advertising is also native. In the world of smartphones though, Apple’s iAds were the first form of native mobile ads. Facebook Mobile App Install Ads and other in-app rich media ads also qualify as native mobile ads.

You get the idea.

Debate on the definition aside, the other big question around native advertising is can it scale?

The success of native ads on a given platform is a function of scale. There are two scenarios of scale, in my thinking.

Players that qualify as marketing platforms — YouTube, Facebook, Twitter, Tumblr, Foursquare etc. — can easily scale native ads and find enormous success. However, players that don’t qualify as marketing platforms – publishers, content aggregators and networks like LinkedIn – will have a hard time scaling native ads, even if they were able to come up with ones that work.

And by scale, I mean hundreds of millions of ad dollars if not billions.

Native ads do scale when it comes to marketing platforms such as Google and Bing Search, YouTube, Facebook and Twitter.

Unfortunately, for publishers and content aggregators, I do not see how native advertising, however you define it, will scale. Unless one of the major marketing platforms comes to rescue.

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