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Native ad spending to rise

News, 30 January 2015

NEW YORK: Almost six in ten client-side marketers used native advertising during the past year and a similar proportion expect to increase their spending on this format in the coming year according to a new report.

The findings are contained in Advertising Is Going Native, produced by the Association of National Advertisers (ANA) and based on sample of 127 marketers. 

This found that, in 2015, 63% of respondents planned on increasing their native advertising budgets, which currently make up only a small part of the total: 68% reported that native advertising is 5% or less of their overall advertising budgets.

Disclosure and ethics emerged as key concerns, with the former being, the ANA said, "the single biggest issue about native advertising that keeps respondents up at night".

Two-thirds of respondents agreed that native advertising needs clear disclosure that it is indeed advertising; just 13% thought this wasn't needed. And three quarters felt there was an ethical boundary for the industry when it comes to native advertising.

Bob Liodice, ANA president and CEO, saw native advertising as "a win for marketers, consumers, and publishers".

But he warned that it was vital consumers could tell the difference between native advertising and editorial. "Marketers have a responsibility to be transparent to maintain trust, and they must play a lead role in working with publishers to ensure proper disclosure," he said.

Native advertising was most commonly associated with digital/online and social media, and usage was highest across both. Fully 85% of respondents engaged in native advertising did so via digital/online publishers and 71% through social media.

The report also highlighted challenge of measuring the impact of native advertising, with multiple metrics employed but none standing out as "most important."

And that, according to Advertising Age, is one of the main reasons that native advertising will remain a niche for some time to come.

In addition to a lack of detailed analytics, it pointed to unrefined audience targeting and also suggested a backlash against the format was emerging among educated consumers who "don't want to feel tricked into reading oblique pieces about products or brands in editorial stories".

Data sourced from ANA; additional content by Warc staff