Updated: Oct 19
by Jayson DeMers
I demystify SEO and online marketing for business owners
Have you ever come close to clicking on an article headline, only to notice that it was “sponsored content,” and not officially published material? If not, you’ve probably clicked one of these links without even realizing it.
To many consumers, these might as well be typical articles. But experienced marketers know them by another name: native advertising. It’s estimated that native ads will be responsible for 74 percent of all ad revenue by 2021, and it’s already poised to reach $21 billion this year. With a novel concept, backing by thousands of marketers and publishers, and a trajectory of exponential growth, it’s no wonder why so many people are excited about the trend.
But here’s the thing: it’s unsustainable.
Native Advertising in a Nutshell
Before I delve into my reasoning, let me clarify what “native advertising” is to anyone who’s unfamiliar. The term is somewhat ambiguous, because the concept applies to a wide range of scenarios. The idea is to include some form of advertising that naturally blends into another source of content or material.
For example, a brand may pay to have a written article featured on a publication site that already features similar articles. Typically, these posts are indicated to be “sponsored,” but this acknowledgment isn’t always obvious. The goal is to make the ad more appealing to a discerning audience.
If need some clarification about the concept, Copyblogger has some classic examples here.
So what do I mean by “unsustainable?” I don’t mean that native advertising hype is overblown, or that it’s a bad investment—not at all. Instead, I mean this growth pattern won’t be able to last. We’re seeing greatly increased spending, year over year on native advertising, and I believe this growth will eventually reach a plateau, at which point it may crash, and native advertising may fall out of favor.
So why have I adopted this viewpoint?
The Trust Factor
First up is the trust factor. Content marketing came to be popular as a response to traditional ads, which general consumers have grown to distrust. Consumers prefer content that’s genuine and valuable to content that’s intended solely to sell a product.
If they click on an article expecting genuine content without an ulterior motive, but they find an ad instead, they may feel an instant lack of trust toward both the publisher and the brand pushing the ad.
This isn’t hypothetical, either; it’s already happening, as evidenced by this run-in with the Atlantic’s publication of an ad by the Church of Scientology.
Ad blockers are also problematic for the future of native ads. Anyone with a decent ad blocker on their browser or smartphone will automatically pass over any explicitly sponsored ad content on publisher sites.
The fact that Google Chrome is making a push for ad blockers as a default feature makes things even more complicated. If too many users are applying ad blocking technology, the reach of native ads could plummet.
Scalability is another issue. For an ad-related industry to earn continued, sustainable growth, it needs an unrestricted outlet for growth; for example, Facebook and other social media platforms can keep growing advertising placement and revenue as long as they keep attracting new users or increasing usage time for existing ones.
But native advertising has a spatial problem; including more native ads automatically reduces the amount of core content that can be featured on a site. Include too much, and the publisher site instantly loses credibility. Users leave, the ads become less valuable, and the whole operations implodes.
Some major native ad authorities have even admitted to this problem, recognizing the importance of keeping the operation small, preventing it from interfering with traditional content.
Let’s say a user is on a publisher site that’s known for posting snarky, casual content about men’s fashion. The user clicks on a native ad without realizing it’s a native ad—a major goal—but ends up reading a dry piece about the importance of life insurance.
This cognitive dissonance can and does leave a bad taste in users’ mouths, driving down engagement rates for publishers who rely on native ads and turning users away from the advertisers placing them.
Obviously, the goal for marketers is to use content that matches the publisher as closely as possible, but this isn’t always straightforward, and even a single misfire can negatively affect both parties’ reputations.
Despite its weaknesses, native advertising still has many strengths, and I could see it evolving in a few different directions:
Leaner, sparser, cheaper ads. Native advertisers can get around the trust and scalability problems by keeping native ads lean, sparse, and cheap. Essentially, native advertising can never be a prominent source of revenue or occupy an entire company’s ad spend. Instead, it would occupy a small niche and resist extending beyond it.
Integrated shopping and affiliate links. I could also see an evolution toward the integration of direct buying opportunities, such as ecommerce options or affiliate links, rather than content meant to “fool” the audience into thinking it’s direct from the publisher.
Content-centric production. In some ways, writing guest posts for off-site publishers is a watered-down form of native advertising—except the goal here is to genuinely provide valuable content without being promotional. But just by authoring the piece, you gain credibility and exposure for your brand, which is what makes the strategy valuable from a business perspective. It’s a far more sustainable alternative that achieves many of the same goals, while also providing value for publishers – many publishers rely on external, unpaid contributors to help meet their audience’s demand for quality content.
Native advertising is an effective medium, but its growth won’t sustain for as long as most other experts are projecting. If you’re interested in the strategy, make sure it occupies a portion—but not all—of your digital marketing budget.
In the meantime, focus on your content marketing campaign and other approaches that focus on providing value to your customers.