• by Skip Brand , March 22, 2013

Native advertising is one of the industry’s hot topics right now, so we’re introducing this three-part series to delve into the phenomenon from the perspective of a technology company and premium ad network (Martini Media), an agency (Morpheus Media), and a SaaS platform (Flite).

Two of the biggest trends in the industry today are content marketing and native advertising. Native advertising features content-based ads that blend seamlessly into the design of a site, so much so that they appear to be part of the site rather than a sponsored external element.

A defining characteristic of a native ad is that it is user-controlled. These ad units shouldn’t expand or play or do anything else until the user deliberately takes action to expand or play them. Most importantly, however, native ads should also feature custom content. A perfect example of this is work being done by The Atlantic (all tragic incidents aside), Funny or Die and Forbes.

Content marketing puts brands in the publisher’s seat, giving them the opportunity to publish original material to establish thought leadership, become more accessible and appealing to consumers, or retain current clients in their respective vertical. Success in content marketing has been simplified with the rapid growth of social media and push-button publishing. A perfect example of how effective and simple this can be is American Express’s Open Forum, a vibrant community of small business owners sharing ideas and consuming top-quality, American Express-created content.

The introduction of the IAB rising stars -- particularly the Portrait -- has made it possible to marry native advertising and content marketing into a visually appealing, yet powerful ad unit. These three-module units can feature various interactive elements, social media feeds, original content, HD videos store locators -- all cleanly integrated into the publisher’s site design.

The engagement rate on these ad units has been high -- frequently in the double-digits, compared to older, static units. But they really lend themselves to that level of engagement. Picture, for example, a luxury auto ad that featured a high-def tour of the interior -- a social module that showed how many of your friends “like” this car, and an interactive module that allowed you to schedule a test drive. That’s a lot for a single standard ad unit to accomplish.

For brands, these units provide the opportunity to publish the original content they have worked so diligently to create. Beyond just the TV commercials and beautiful magazine stills, brands can publish social content to their Portrait ads. Burberry, Kate Spade and other leading brands have created gorgeous content on YouTube and Instagram, and they have vibrant, active communities on Facebook and other networks.

They can display user generated content, as well as their own “home grown” materials via the ads, and invite interaction – which can occur within the ad unit. You can pin, follow, like, share, whatever – without leaving the page.  

These are the things that are happening in native advertising today. It’s more than just Facebook ads and Sponsored Tweets -- premium, high-end publishers are introducing their own brand of native, and it’s super-friendly to advertisers. The advantage to the publisher is that they now have the opportunity to offer a premium ad on their premium site, demanding a premium price. As an example, a top-tier publisher like Conde Nast can enjoy all the perks of native advertising; specifically, a beautiful ad for a well-known luxury car that blends naturally into its site design and doesn’t detract from or compete with editorial content. Another advantage: publishers can reduce clutter and offer just a few slots per page without suffering a hit to revenue.

These new native ads, marrying content from both publishers and advertisers, can be an across-the-board win, inviting engagement and interaction from consumers. But with new standards and practices come new challenges. The next installment in this series will examine the trend from an agency perspective, providing insight into why native is so big with luxury brands, and the challenges this introduces for their agencies.

This is part one of a three-part series on native ads.