• by Selina Petosa , February 1, 2016

In the ever-evolving age of digital advertising, brands often look to agencies for recommendations and guidance on the changing landscape. The mediums available and magnitude of options is constantly growing, offering new opportunities for brands to reach consumers elegantly within the context of their daily lives. With this influx, though, the line between native content and native advertising has become blurred, and for some time, there has been a need for higher standards within the industry.

Native ads have always been ambiguous by nature, with little to no labelling, and as a result many consumers have been left unaware that the content is in fact an ad. A truly creative ad should be captivating and evocative to demand a consumer’s attention without deceit. As such, the Federal Trade Commission’s (FTC) new set of guidelines, distinguishing contextualization vs. deception, signals a step in the right direction. But with this new industry standard, some questions have been raised. How will the new guidelines impact consumer engagement? And how will publishers and ad agencies adapt to the changing landscape and continue to deliver effective campaigns?

In their current state, native ads are not clearly marked for consumers. In fact, according to MediaRadar, 26 percent of websites run native ads without mention of sponsors at all and in the chance that they are marked, the labels are often listed at the bottom of the page or with words like “promoted,” “recommended for you” or “sponsored.” In addition, researchers at Grady College in Georgia conducted a study to determine how well consumers could identify native ads and the findings suggest that consumers cannot easily identify them. Less than eight percent of the study participants were able to distinguish native ads as paid marketing. The new guidelines are clearly a must to improve any deception viewers have experienced, and also present an opportunity for agencies to experiment and innovate.

Ad Content, Not Simply Format, Will Dictate its Effectiveness

With new labels attached to native ads, agencies will indeed be challenged to make content so compelling and captivating that consumers will read on despite the labels. If done correctly, native ads pose a win-win situation for advertisers and viewers—advertisers garner the attention of target audiences and consumers gain engaging and enticing content.

One example of a highly successful native advertising campaign was Netflix’s work with The Wall Street Journal on Cocaineconomics, an in-depth and interactive look at the story behind the Medellin drug cartel and how they were able to grow it into a multi-billion dollar business. Netflix worked with The Wall Street Journal on this piece in conjunction with the release of their new original series Narcos and integrated clips from the show into the article. The article was so well-received that it got even more attention and promotion through Twitter and advertising outlets, further proving that good content is good content, whether or not it is sponsored.

Native ads have been considered deceptive by some, but good advertising does not need to be deceptive. Strong advertising materials and content will draw the consumer in regardless of its labels by providing content that is entertaining, insightful and compelling. Through the new guidelines, the FTC is taking an important step in helping the consumer remain informed about the origin of the material they are viewing.

Agencies Will Drive the Shifting Perceptions of Native

Initially as the guidelines are implemented, though, the obvious labelling of this content may deter user engagement, but that doesn’t mean the medium should be dismissed. If agencies are willing to dedicate the time to creating elegant and alluring native ads—which they should be!—then readers will follow. For publishers, the rational next step is to provide data and metrics, allowing agencies to gauge effectiveness and accurately track campaigns. Without this information, brands and agencies can’t confidently invest their dollars in this medium.

Time and numbers will tell whether or not native ads will continue to be an effective form of advertising and while we may see a decline as publishers enforce the new standards, ultimately efficacy will begin to improve. In due time, and with creative ideas, consumers will become accustomed to seeing this form of advertising and begin to view it similarly to social media, a way of the brand communicating with them in a method that’s different than a traditional hard-sell.

With the new changes in native advertising standards, brands can expect to see a change in viewers’ reactions to native ads. Before, consumers were unknowingly interacting with ads, but as they begin to realize that the content is brand-generated material, advertisers will have to work to deliver content that consumers will want to read despite the labeling. This leaves agencies responsible for working hand-in-hand with brands and publishers to create content that grabs the attention of consumers and differentiates itself from the advertorial of the past. Agencies will need to evaluate native vs. traditional and digital advertising vs. editorial approaches to provide brands with clear recommendations. Despite the changes, native has become and will likely remain another channel within an integrated marketing approach that has the potential to be incredibly effective if executed correctly.