4 reasons native advertising is exploiting brands

nativeAs content marketing continues to take over the popular marketing psyche, native advertising in particular is fast-becoming the most popular conception of the practice.

Native advertising has been billed as something of a panacea for brands who are seeing diminishing returns from traditional advertising that is blatant, irrelevant and overtly salesy. The promise of native advertising for brands has been the opportunity to access audiences that can be subtly exposed to branded content that has been published ‘natively’ and are therefore increasingly likely to pay attention. Off the back of this promise, a $44billion industry (source: Custom Content Council) has developed, with publishers, agencies, content creators and technology providers all clamouring to join the goldrush of this new opportunity.

However, whilst the spike in interest around native advertising has led to all kinds of collective back-patting, no one is able to answer the most important question of all – is native advertising making any money for the brands that do it?

Curiously, the very same voices that are quick to trumpet the merits of native advertising’s impressive creative or how it’s ushering in an era of novel agency models go noticeably silent as soon as anyone mentions the tricky issue of ROI.

Why is this?

1) Native advertising measurement is unstandardised

Although marketers are just about coming round to the importance of measuring content marketing, native advertising practitioners are still struggling to standardise what to measure and how to measure content that is natively placed.

Attend any marketing conference and you’ll continue to see editors, agency bods and marketers, battle over whether native advertising should be measured with editorial metrics, web metrics or social metrics.

Until native advertising measurement is standardised, brands will struggle to benchmark their efforts in any consistent way.

2) Native advertisers only measure engagement, not conversions

As with content marketing, the success of a piece of native advertising is invariably measured in terms of engagement metrics such as dwell rates, visits, shares, retweets, linkbacks, scroll depth, etc.

These are all lovely but they must be tied to actual user behaviour as it relates to the brand. Engagement metrics need to be linked closely to business metrics (i.e. more conclusive actions that can be ultimately tied to a conversion or retention decision).

3) Publishers are controlling the brand’s purchase funnel

In most examples of native advertising, brands have limited explicit messaging beyond a logo where it can’t do little harm to the publisher’s branding.

As such, the unique voice of the brand – the voice that communicates the value proposition that ultimately helps drive the consumer into the conversion path – is completely lost. Without this bridge from the content to something actionable, the consumer may never make it to the sales funnel. (Buzzfeed is a good example of this – there is never any click-through to a Buzzfeed partner’s website).

Native advertising needs to lead consumers to a brand’s owned property so they can track inbound traffic and the customer journey thereafter. As it currently stands, brands largely rely upon whatever metrics a publisher is prepared to relinquish. These are typically quite limited in terms of actionable insights and rarely concord with the brand’s internal (read: commercial) goals.

4) Ethics and aesthetics are privileged over mature conversations about ROI 

Most serious debate around native advertising centres on either how good it looks or the rights and wrongs of doing it.

This is not good enough.

A brand is a business and businesses exist to make money. Quite simply, for native advertising to be of any real benefit it has to be either demonstrably generating revenues or saving money for a brand. Until the native advertising industry is prepared to talk openly about this, brands being able to measure native advertising’s effect on either critical business outcome seems unlikely.

The native advertising boom is generating considerable revenue for publishers, content creators, agencies and technology providers.

However, unless native advertising grows up and starts proving its effect on the bottom line, brands are doomed to be paying out a lot with precious little to show for it in return.

Jonny Rose is head of content for Idio