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Pros and Cons of Native Advertising

Once upon a time, advertorials only appeared in newspapers and magazines. Now, they appear online in a new form called native advertising. Although our advertising agency in Austin does not currently offer a native advertising product, the fast rise of native ads is difficult to ignore. So, what are they? In a nutshell, native advertisements are ads that appear in-stream, usually on the feed of a news destination website. The ad looks the same as the legitimate news articles that surround it, with some minor indicator that it is sponsored content.

It is a trend that enjoyed a quick rise to popularity. 2013 has been called “the year of native advertising,” with nearly half of media buyers who responded to a Sharethrough survey claiming they plan to spend on native ads sometime this year. The same survey also found that 20% of publishers plan to add native advertising opportunities soon. Why native ads are now part of the mainstream has been a hot topic lately, and the consensus is this simple proposition: People are tired of banner ads. But could that really be?

There may be some evidence. The survey asked 4,770 consumers about their responses to native ads, with 200 of those consumers agreeing to have their eye movements tracked as they looked at various arrangements of content, including ads. The experiment revealed that subjects were 25% more likely to look at a native ad than they were at a banner ad; furthermore, they looked at the native ads 53% more often. The average participant looked at the native ads 4.1 times per session, and only looked at the banner ads 2.7 times.

Participants also said they were more likely to share a native ad with others, and showed 18% more purchase intent after viewing them. It turns out that people like ads that “behave” the same way as the other content they consume. As Sharethrough identified, “Readers are more likely to pay attention to marketing messages that resemble the content around them.”

These are the pros of native advertising, but it is not without its cons. Critics of native ads make arguments such as:

  • They are just repackaged advertorials (unlike promoted ads on Facebook, etc).
  • The definition is confusing. Some equate native ads to product placement and other types of contextual advertising.
  • Google may begin penalizing them. The concept of scrutinizing advertorials and spammy native ads (native ads that don’t disclose themselves) was touched on in a recent Google video blog.

Banner ads still work, to some extent. Because a banner ad is likened unto a giant logo in the face of users, it still outperforms native ads in the brand recall department. The study showed that the brand recall on banner ads was 38%, and only 25% on native ads.

ShareThrough’s ‘Native Adscape’ shows the current Native Advertising Landscape in a simple, breakdown between Social and Editorial categories, as well as content publishing requirements for each. (Click the image for enlarged view.)

So for now, it may not be wise to shift your entire budget over to native advertising. There is no guarantee that buying ad space in news feeds is going to increase conversion rates for your website. But for established companies interested in trying something new, it may be worth exploring the opportunities that native advertising offers. If you are seeking an advertising agency in Austin that can help you determine the best strategies for your unique business, contact Crest Media for a free advertising consultation.

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