Low renewal rates from ad buyers on Native Advertising: Does it work?

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March 8, 2017 by Paul Dughi

native-advertising

You know native advertising.  It’s when instead of running an ad, publishers integrate advertising messages into content.  It may be in the form of a news-looking article that features the company’s information or employees.  In its best form – clearly labelled as advertising content – it may provide interesting and useful information.

Used improperly, it’s disguised to look like news when it’s really an ad.  And not following the guidelines can merit fines.

It’s popular.

An average of 610 new advertisers are getting into the native advertising business every month, according to MediaRadar.  According to Business Insider, native ads are booming and expected to continue to grow.  They estimate spending in 2016 at $7.9 billion.

native-ad-spending

Does it work?

Well, depends on who you ask and what your goals are.  We talk to clients a lot about being careful not to chase that “bright shiny object.”  Be careful where you spend your advertising dollars and make sure they align with your goals.  Native advertising may make perfect sense for your marketing needs.  But if your goal is to sell products, native ads may not be the right venue.  There are plenty of other options – product ads, call-to-action campaigns, paid search, and plain old advertising – that might be the best pick for your dollars.

Whether it’s the right option for you depends solely on your marketing goals.  Too many advertisers chase that bright shiny new object instead of starting from the goals and building a strategy from there.

Low renewal rates

Perhaps that’s why, of those that do decide to get into the native advertising game on media sites, only 33% renew their campaigns, according to a study by MediaRadar.  Don’t right – and done well – it works, but only if it’s with top brand publishers and aligned with the buyer’s goals.  Renewal rates at top sites have a 49% renewal rate and the top 11 websites tracked had rates above 60%.

It’s another example of what we all know deep down:  you get what you pay for.  Spend the right money in the right place and it works.  Throw your stuff into an ad network where you have no idea where you have no idea where you stuff is running or who’s managing it and you may get a lower price… and less or no results.

Disclosure issues

MediaRadar also tracks 12,965 brands and found that only 37% of website were complying with Federal Trade Commission (FTC) rules on native advertising labels.  Publishers and advertisers face significant fines for failing to follow the guidelines, but nearly two-thirds have decided not do so.

For the record, we do create native advertising campaigns for clients at WAAY-TV and AudiencePop.  We clearly label tham as “Sponsored Advertising Content.”

Bottom Line

It can work when done well and aligned with your goals.  Don’t be mesmerized with the hot-next-thing someone is pitching you.  Define your objectives and then build a strategy from that, utilizing marketing and advertising tools that will clearly match your objectives.  Even in this digital era, some things never change.

 

 

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