THE TRUTH BEHIND NATIVE ADVERTISING AND PROGRAMMATIC ADVERTISING

WHAT IS NATIVE ADVERTISING?

By definition, native advertising is a typed of disguised advertising that matches the form and function of the platform upon which it appears. The word ‘native’ refers to the coherence of the content with the other media that appears on the platform. In layman’s terms, native advertising is a way for companies to pay other companies to talk about their brand. Sounds much like normal advertising? The difference is that with normal advertising, a reader can catch the obvious “ad” in the content which it appears. In contrast, native advertising is a subtle approach to pushing advertising to the end consumer without them fully realizing that it was an actual ad.

The reason companies are moving toward this type of advertising is because consumers are getting smarter of advertising and tuning out ads. Jonah Peretti, CEO of Buzzfeed, stated that, “these days people are slowly learning to tune out traditional ads.” Gone are the days of interruptive, outbound advertising.

A real example of native advertising

While commuting to work in the mornings, I tune in to the local radio station which typically has a talk show airing. Typically they will cover local news with national news with the occasional world news. The two talk show hosts go back and forth on their topics, sometimes calling upon listeners the chime in. In between stories the two talk show hosts will conversate small talk of random topics. But since I have been tuning in to the same radio station for a few weeks, I have noticed a trend in their small talk. Lately, one of the talk show hosts have been claiming he hasn’t slept well and his back hurts throughout the night and into the next day. That’s when the other talk show host starts talking about his amazing Sleep Number™ mattress. Then they continue to talk about how great the benefits are of the Sleep Number ™ mattress like it was just a small talk comment that initiated the talk. As the weeks have progressed, I realized they kept bringing up the Sleep Number ™ mattress.

Radio small talk is a great way to introduce products into a segment in a more narrative, natural way without it being overly obvious and interruptive. Radio is just one type of native advertising. It happens a lot in podcasts and online as well as in print.

These pictures were found in “The New Yorker” magazine where Target purchased all of the ads throughout the magazine and subtly incorporated their logo into the artwork. Flipping through magazine, you cannot help but notice the 18 pages plus the cover page that has the iconic Target logo. Too much of native advertising can leave the reader, or listener, wondering if it was an advertisement or just content.

One this is for sure, native advertising is getting more integrated in content which is further blending the lines between content and advertising. Anyone considering the use of native advertising much know the risks. One main risk is a consumer catching onto the ad and have feeling of being duped. For example, radio show hosts create a large following, with commuter driving every day to work tuning into their program. They create a sense of trust with their listeners and, like the Sleep Number™ mattress example shows, people can catch on and that built trust can be broken.

WHAT IS PROGRAMMATIC ADVERTISING?

Another rising marketing term is programmatic advertising. Programmatic advertising is making data-optimized ad buys in an automated fashion. What? Taking a step back in the old days, advertisers would purchase ad spots in on different sources whether that is television, newspaper, magazines, and more recently on websites. Advertisers would call, email, fax over their ad to magazines in which they wanted to advertise to. But this all blew up when the internet took off. In the beginning, advertisers had a smaller number of sites which they would run their ads but when the internet got more mainstream, literally millions of sites were available. That is when it became too much for advertisers to handle on any given day. Enter technology. Once technology got advanced enough, computers could handle these exchanges, and at and incredible speed.

Programmatic Advertising Analogy

Programmatic Advertising can be confusing. Think about it this way: earlier, if someone wanted to purchase stock, they would call up a broker and purchase stock from them. The broker would purchase the stock for you and would get a cut of it. Now, sites like eTrade have used technology to bypass the broker and the transactions are made online. The brokers are in the same position that the advertiser. Stock exchanges became too much to handle for brokers and it naturally migrated online.

NATIVE AND PROGRAMMATIC: WHAT’S NEXT

Both of these subjects are still in their infant stage. Advertisers are still testing the waters with both, figuring out new ways to incorporate it into their brands. As marketers and advertisers continue to improve native advertising and programmatic advertising, we will see a more refined process of each. Native advertising can be adopted with great success, where people or brands have followers. Examples would be radio talk shows and/or bloggers both of which can garner huge followings. It is a great way for these two categories to create additional income. Although we don’t know exactly where they will end up, we will see and hear more about the subject.

LEARN MORE

• Why Native Advertising and Skeptical Consumers Are Top Barriers to Native Ads
• Digital Media Buying Gets the "Programmatic" Makeover
• Explain It Like I'm Eight: Programmatic