We are in the post-PC era. Really soon, billions of consumers will be carrying around Internet-connected mobile devices for up to 16 hours a day. Mobile audiences have exploded as a result.
According to recent research issued by the IAB, Internet ad revenues hit record-breaking double-digit growth, reaching nearly $37 Billion dollars in 2012. Also, for the second year in a row, mobile as a platform achieved triple-digit growth, surging 111% to $3.4 billion. Indeed, the market potential of mobile advertising is huge.
One of the factors that has influenced on growth in the digital advertising sector, and the mobile sector in particular, is native advertising, which offers seamless integration between ads and the aesthetics, user experience content of the websites or applications that run them. Since early 2012, these native ads have been cropping up everywhere, from news websites to Google to Facebook.
It's obvious that native ads are going to become the new formats that will bring real depth and differentiation to the mobile ad market.
But what exactly is a native ad on mobile?
As a good explanation we can mention a Reuters columnist Felix Salmon who noted in a recent column:
"A native ad is something that consumers read, interact with, even share — it fills up their attention space, for a certain period of time, in a way that banner ads never do ... In that sense, TV ads are truly native; the way you consume a TV ad is the same as the way you consume a TV show. Similarly, long copy print ads are native, for the same reason. And the ultimate native ads are the glossy fashion ads in Vogue: In most cases, they’re better than the editorial, and as a result, readers spend as much time with the ads — if not more — as they do with the edit."
Here are the main few facts you should know about the emerging world of native ads on mobile:
The right definition
An ad is not "native" simply because it's only possible on a mobile device, like an ad with a touchscreen interface. A native ad has to be an integral part of a site or app experience.
The scale issue
The one downside to native ads. By definition, since it is inventory created by publishers based on their unique characteristics, they don't scale well. They likely won't be traded in automated exchanges.
The price and cost issue
The price of showing a mobile ad has famously being pegged at just 75 cents for every thousand impressions, compared to $3.50 on desktop — and much higher than that for premium PC-based publishers. Native is aiming to be premium and raise the price bar for mobile.
The brand challenge
Advocates for native ads on mobile argue they'll bring brands deeper into mobile advertising since they are a perfect showcase for brand messages. But brands aren't only after native formats, they're also after better tracking and audience data.
The impact on the broader ecosystem
Native ads present publishers and native-focused ad companies with a unique opportunity to command higher prices and exert more control over their inventory. For ad buyers, they're a mixed bag: higher-cost, difficult to scale, but powerful vehicles for certain campaigns.
The main categories of native ads on mobile
We distinguish between native ads on mobile and mobile-only native ad formats. And we dive into the particularities of the main types of native ads: branded content, in-stream ads, activity-triggered ads, and mobile-only native ad formats like click-to-call paid search results.
The more you delve into it, the more "native" seems to be a synonym for "good" with regard to advertising. If nothing more, at least it's an attempt to make online advertising as good as TV or print ads. That's a good thing, but it's doesn't really mean that it brings something so much new.