Dive Brief:
- In two separate research releases, native advertising was shown to be a dominant marketing category that is only just picking up pace.
- Facebook released stats on its Facebook Audience Network (FAN) that showed 83% of the ads on the platform were native advertisements.
- And a separate recent study on native ads by Facebook and IHS Inc. predicted 63% of mobile display ads will be in the native ad format by 2020, driving some $53 billion worth of revenue. The same research also forecasted that mobile will account for 75.9% of all global digital ad spending in that same four-year period.
Dive Insight:
Native advertising is on the rise, and a key reason is engagement. The Facebook and IHS research reported native ads have 20% to 60% higher engagement rates than banner ads, and native ads create retention rates three times higher than banners. Looking at ads on FAN, Facebook said native ads have CPMs seven times higher than banner ads.
Facebook is in a particularly strong position given the trend toward native ads as well as mobile ads. It leads Google in mobile display ads, accounting for 33.5% of mobile display spend compared to 10% for Google last year, according to eMarketer.
The social media giant also recently dropped banner ads from the demand-side buying aspect of its Atlas ad-serving and measuring platform, and explained the move by stating that internal research found only native and video ad formats drove value for advertisers.
All of these developments and data points taken together indicate native advertising will likely continue its positive trend.
"Initially, we saw mobile advertising struggling to match the success of mobile app usage and consumer spending," Eleni Marouli, principle analyst at IHS Technology and co-author of the study, said in a statement. "Now, native advertising is booming and today’s most successful mobile marketers have already made the switch. The future of mobile advertising is native."
And the future of advertising is mobile.
