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Programmatic & Mobile Lead the Native Advertising Arms Race

There’s no doubting the sharply growing value of native advertising, with the global market expected to reach USD$59.35bn (£40.88bn) in 2018. The question is how the market is shifting to take advantage of how we go online and expect those ads to be served. To help answer that issue, Adyoulike analysed over 1.3 billion in-feed native ads run throughout 2015, looking at advertiser, publisher, and consumer behaviour. Francis Turner (pictured below), UK MD, Adyoulike tells ExchangeWire that 2015 was another huge moment for native advertising, thanks largely to OpenRTB 2.3 being introduced as the agency standard for trading native ads programmatically and at scale. 

Its impact was immediate. In fact, we discovered that 12 months or so after the introduction of OpenRTB 2.3, around one-in-six native campaigns (15%) were already being run programmatically. This number is expected to climb by the end of 2016 as more and more advertisers and publishers see the benefits of genuine reach and scale that the methodology has to offer.

Beyond that, our analysis showed that native was increasingly becoming the method of choice when advertising through mobile. Back in 2014, half (50%) of native spend covered all devices, 40% was for desktop-only and 10% was mobile-only. But in 2015, while half the spend was still device-agnostic, mobile-only tripled in size to 30%, and desktop-only fell to 15%. In addition, last year saw 81% of publishers running native ads on mobile, compared to only 62% the previous year.

This is no real surprise, as mobile and native are clearly the perfect match. Native ads provide quality content, which consumers demand, delivered in-feed in a way that doesn’t spoil the mobile experience. In fact, we were pretty surprised that almost 20% of publishers still didn’t offer mobile native.

With an increasing number of people using their mobiles as their primary way of browsing online, in-feed native is going to become increasingly important. For publishers and advertisers, the onus and focus should now be on providing top-notch, creative content that engages and entertains.

This need for engaging ads, and the ability to trade native programmatically, has meant there has also been a shift in how creative is employed by brands and agencies in their digital campaigns. At last, we’re now looking at native as a creative medium in its own right – highlighted by the fact the number of native video ads that simply re-used an existing TV ad fell from 90% to 78% in 2015.

Advertisers also provided more creative options to publishers to use in their native advertising: The number of campaigns supplying three to five different creatives rose from 18% in 2014 to 46% last year, the number offering more than five creatives doubled (10% to 20%), and the number offering only one fell from 26% to only 5%.

Francis Turner | AdyoulikeThe creativity gap that has long plagued digital advertising has been answered. Brands are now starting to realise that they can create new material, rather than just re-using what’s appeared on other channels. And, not only that, but they also have to offer different creative options to effectively scale their campaigns and keep them fresh; and, most importantly, keep consumers onside and willing to engage with the ads and content served.

In the face of the rising use of ad blockers, publishers, advertisers and brands need to be aware of the increasing importance of basing any digital advertising on the value exchange. In exchange for interacting with a brand, digital consumers expect something in return – whether it’s an ad that entertains or informs them, or that they find interesting, the value exchange has to be at the centre of the interaction.

Beyond the development of better creative through native delivery, our study also found the influence of mobile goes beyond just the method in which the ads are served. Take for instance headline length – more than half (53%) of ads with shorter headlines, measuring 1-40 characters, were clicked through in 2015, compared to 32% in 2014. Meanwhile, the number of ads with longer headlines (70-90 characters) that were clicked on fell from 36% to 17%.

This was a huge drop in click-through rates and most likely the influence of mobile devices with smaller screens and less room. On top of this, headlines that didn’t have any brand names mentioned were four-times more likely to be pursued than those that did – up from twice as likely in 2014. Consumers are, it seems, getting switched off by listicles or click-bait titles with overlong titles – and they’re clearly not happy with push brand mentions clogging up their feed.

In the face of sceptical consumers, digital advertising through native has risen to the occasion, offering a genuine alternative to static display ads. Both brands and publishers have been quick to seize the opportunity, but there’s still more they can do to take advantage: with OpenRTB 2.4 just launched, and mobile and tablet use rising every year, native is simply going to reinforce its position as the de facto choice for the small screen, putting itself front and centre of the digital media mix overall.