The average CTR for native ads is almost 3x higher than for regular display ads.
In a study conducted by AppNexus, it was discovered that the Technology B2B Industry had the lowest average CTR of all industries – 0.50%.
At the other end of the spectrum, the average CTR for Finance & Insurance ads averaged out at 0.80%, and for Technology B2C at 0.90%.
Meanwhile, regular display ads have an average CTR of 0.35%.
But before we dive any deeper into the topic, let’s first see what native advertising is.
Table of Contents
1. What is Native Advertising? (and how does it work?)
Native advertising is a form of paid media where the ad mimics the design of the website it gets displayed on, blending in with the rest of the content.
Basically, a native ad copies the design of the website and makes it look like the ad is just regular content. They are by far the most non-intrusive ad format, and that’s one of the main reasons why they work so well.
At first, that might seem like a true nightmare. Businesses could run native ads and trick users into believing that they’re reading a regular piece of content, when in fact, they’re reading a sponsored post.
If the ad copies the design of the website, how can a user tell them apart?
Actually, it’s not that difficult.
A section of native ads will always be labeled as “Sponsored” or “Recommended by [advertising platform].
When it comes to native advertising, there’s more than one form. But perhaps the most famous native ad formats are Facebook’s and Instagram’s sponsored posts.
2. Types of Native Advertising
There are 3 main types of native ads:
- Sponsored content.
1. Native Search Ads
Google released its advertising platform back in October 2000.
Today, their ads are perhaps the most recognized form of paid advertising. Millions of advertisers invest billions of dollars in their Google Ad campaigns, putting it at the top of the digital advertising market, with a 32.3% global market share in 2019 (according to Statista).
However, this makes it rather difficult for advertisers to target certain keywords, as the competition is fierce and many small businesses simply can’t afford to compete with large advertisers.
If Google is the market leader in digital advertising, Facebook comes in second. And it’s no wonder, given the massive number of businesses advertising through Facebook and Instagram.
And ads on Instagram are even harder to tell apart from regular posts, considering the type of posts.
Let’s take this image for example.
SIDENOTE. Image source: Converse
Do you think it was used in a sponsored post or in an organic one? Find the answer at the end of this post.
3. Content Recommendations
Also known as open web ads, content recommendations are ads encountered on the sites of publishers, usually in a sidebar or separate box labeled “Recommended stories” or “Recommended From The Web”.
They are by far the most common type of native advertising encountered, especially in the world of cryptocurrency. Businesses such as Taboola and Outbrain.
3. Why is Native Advertising gaining popularity?
The digital advertising market is constantly increasing every year. Publications such as eMarketer, BusinessInsider, and AppNexus expect the native ad market to represent the majority of all ad spend by 2021 at the latest.
But why do native ads perform better?
The answer is rather simple.
Because most of the time, they don’t feel like ads.
Native ads are non-intrusive.
They don’t pop up on your screen on a huge banner that promotes a 20% discount on pool cleaning supplies when you’re trying to do research for that course you’re taking. When you don’t even own a pool.
4. 5 tips to improve your Native Ads
1. Use power words
What is Native Advertising and why should you care?
Your Actionable Guide to Native Advertising (in 2020)
I think you would all agree when I say – the second title sounds way better than the first. And part of the reason has to do with power words.
Power words can have a great impact on the way people interact with your ad, by appealing to their emotions.
There are 3 main types of power words:
- Persuasive – new, free, imagine, because, instant, how to;
- Emotional – proven, jaw-dropping, little-known, trustworthy, outrageous;
- Sensory – sparkling, enormous, deafening, loud, hurry.
However. Don’t just pick a random power word and throw it in your copy
You must craft your title carefully, and make sure that your choice of power words fits into the content you are promoting.
Start off by answering the following questions:
- What problem am I solving for the people who will see this ad?
- What makes my content unique?
Once you know your Unique-Selling Point (USP), you’ll be able to properly present your audience with a much more attractive offer.
The copy of your ad does 80% of the work. So you should invest most of your time in crafting it, as it has the power to make or break the success of your native advertising campaign.
2. Entice curiosity
There’s probably not a single soul on the internet who didn’t click on a BuzzFeed article.
27 Things Everyone Has Done But Would Never Admit
Well, I guess it wouldn’t hurt to take a 5-minute break from work.
And while we may occasionally feel tricked by them, they’re not exactly clickbait. They just pique our curiosity.
In fact, there’s a whole topic of discussion about this strategy, and it’s called the curiosity gap. And just like with power words, the curiosity gap is not just a marketing scheme. It’s based on psychology.
But I’m not an expert on psychology and neuroscience, so don’t just take my word for it. Instead, check out this research paper which explains the curiosity gap.
3. Be honest
While using the curiosity gap might get you a higher CTR, it’s also a dangerous path to takes. That’s why honesty is your best ally.
Make sure that your audience knows they’re viewing paid content. Otherwise, they might feel tricked, and this will result in negative brand reputation.
Clearly display your brand logo on your image, and make sure that the section in which your ad is placed is labeled as “Sponsored content” or “Recommended by [Brand Name]”.
In the early stages of your business, brand reputation is one of the most important aspects that you must manage. Once people see that you are a legit business that wants to provide value to its customers, they will become fiercely loyal.
4. Don’t make it ugly
This sounds like a no-brainer, but bear with me.
Throughout my life on the internet, I’ve seen some pretty horrendous native ads. And I couldn’t just ignore them. They made me cringe and scroll away from that section, or close the website altogether.
And 9 times out of 10, that was because of the image.
While the media you use in your native ad isn’t that important, it does have its purpose. You should design it to fit beautifully with your copy and catch the attention of your audience.
But that doesn’t mean you should throw in as many colors as possible to “make it pop”.
Keep it simple.
Use your brand colors, or design it to resemble the landing page that you direct your audience to. If your whole website is designed in shades of blue and violet, don’t use a black and green palette for your ad.
5. Set correct expectations using Display URL
When a user decides to click your ad, he has certain expectations regarding what will happen after he clicks it.
And your job is to make sure that those expectations are set correctly.
The Display URL will help your audience get a better idea of the page they’ll reach after they click your ad.
Are you sending your users to a registration form? Then set the Display URL to https://example.com/registration/.
Are you directing users to a landing page created for your special spring promotion? Then set it to https://example.com/spring-promotion/.
The landing URL is the page where a user lands after clicking on your ad. Setting this up incorrectly will result in your ad getting rejected, or in your audience landing on a 404 page.
5. Where is the world of Native Advertising heading?
Remember when we mentioned that native advertising will represent the majority of digital ad spend by 2021?
Well, that already happened.
In 2017, 54% of the digital display spendings went to native placements. In 2018, that number was expected to go to 58.3%.
And one of the reasons why this happened is programmatic advertising.
But what’s programmatic advertising, you might ask?
The short version:
Programmatic advertising is the process of automatically buying and selling online ad space.
The not-so-short version:
Programmatic advertising is a process that takes the buying of buying and selling ad space to a whole new level. This whole process is automatically carried out by the Supply Side Platform (SSP) and the Demand Side Platform (DSP), in a fraction of the second.
The whole process looks something like this:
- A user enters a website;
- The SSP (publisher) puts the ad impression up for auction;
- The DSPs (advertisers) start bidding for the impression;
- The SSP decides which ad to deliver based on bids and metadata (title, description, media elements);
- The winning ad is displayed on the publisher’s website.
This process works based on a Real-Time Bidding (RTB) system, and everything happens in the fraction of a second. The ultimate goal of Programmatic Advertising is to help advertisers and publishers optimize their Return on Investment (ROI).
Through programmatic advertising, native ads can reach a pretty deep level of personalization, which automatically generates better engagement and more conversions.
For the future, we can only expect native advertising to increase in popularity.
Programmatic advertising is just one of the few results of technological advancement. In time, there’s no doubt that more sophisticated technologies will appear, which will take the online crypto advertising industry to new levels.
But it’s not all about technology.
Crafting a successful native ad requires work and effort. But it’s definitely worth it.
P.S. That post from Converse? It’s just a regular Instagram post.