Study on 'native advertising' finds benefits for brands, risks for publishers

Study on 'native advertising' finds benefits for brands, risks for publishers

Summary: The IAB/Edelman report questioned 5,000 consumers of general news, business news and entertainment news.

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In one of the largest studies of people's attitudes towards native advertising, 62 percent said that it didn't help to enhance the reputation of news sites, but brands were seen to benefit from appearing on highly trusted media sites.

Native advertising is a form of advertising designed to look similar to "native" media content such as news or feature articles written by journalists. 

The study shows that media companies carry a far higher risk to their reputation and value perception in allowing native advertising than their brand advertisers. However, native advertising on business news, and entertainment news sites, was less problematic than on general news sites. 

In addition, six out of 10 people visiting general news sites said it was not clear if a brand had paid for the content.

For the "Getting Sponsored Content Right: The Consumer View" study, the Interactive Advertising Bureau (IAB) and Edelman, the world's largest privately owned public relations firm, asked 5,000 nationally represented consumers of online news, to comment on the effectiveness of native advertising across three verticals: general news, business news, and entertainment news.

The study was sponsored by TripleLift, described as "a native advertising technology company."

Here are some extracts:

QUESTION: How much do you agree or disagree with the following? This content can add value to my experience on this website:

2014-07-23_19-27-46

Turn those numbers upside down: Overall 62 percent don't see any value added to the news sites. 

Brands on credible media sites benefit tremendously: 88 percent favorable response on credible sites versus 66 percent on non-credible sites - a 33 percent boost. 

What else did the study discover? Things we knew: Native advertising works best if the brand is trusted, relevant, and tells a great story. 

Foremski's Take: This is not good news for publishers. One of the report's key recommendations is that publishers have to "walk away from advertisers who aren't relevant/trusted." And that they exercise transparency and make sure disclosure is very clear and labelled because an astounding seven out of ten visitors could not distinguish native advertising from native content.

The brands gain much more from native advertising, but it is a short-term benefit. They gain greatly from being on a trusted news site.  But it comes at a cost because their native advertising erodes visitor trust in that site.

This is yet another study that shows that native advertising is a big problem, and not just for publishers.  It's not a win-win situation despite the best efforts of marketeers and PR professionals to cast it as such.

Native advertising on news sites degrades the trust of visitors. Its continued practice will come back to bite the very brands that employ this uneducated approach to marketing.

This study shows:

- The higher the trust in the media brand the better it is for the advertiser.

- Yet the majority of visitors (62% overall), especially in general news (73%), see no added value to the media site from carrying native advertising.

Publishers are hoping native ads will boost lost revenues but they risk loss of credibility and trust from their visitors. Marketers are taking advantage of their business troubles to gain a short-term benefit from native ads. 

Edelman is very much aware of the powerful position trust plays in the lives of brands, government, and professions. It publishes an annual Trust Barometer that surveys 27,000 people in 27 countries — the largest of its kind. 

Brands need to protect and enhance trust in the media they use to advertise. Otherwise both lose. 

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The study's authors include Sherill Mane, SVP Research, Analytics & Measurement at IAB; and Steve Rubel, Chief Content Strategist at Edelman.

I like this introductory paragraph to the study:

"It is a maxim among sophisticated marketers that clicks are a relatively meaningless metric. What matters most is the degree to which consumer attitudes can be formed and reshaped by advertising and marketing communication and then translated into sustainable behavior that benefits marketers and their brands."

It often seems as if the basic tenants of marketing have been forgotten these days. Marketing is not tracking, and tracking is not a strategy — sell me on something!  

 

 

 

Topic: Business Intelligence

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3 comments
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  • Don't get the controversy

    Of course, we know it works. I just don't get the controversy. "Sponsored by" has existed since television was invented. Calling it native advertising is the only part of this format that's actually new. Every major publisher is labeling their native ad content... and responsible companies (Airpush, Facebook, etc.) are all being equally as responsible. NativeMobile published a story recently about whether or not native ads act as a predator on consumers, and I just don't think consumers are so dumb that they can't clearly see labels... This is the biggest non-story I've seen in advertising this decade! http://nativemobile.com/native-advertising-deserve-predator-reputation-3603
    Andrew Huttle
  • The euphemism tells all

    The fact that someone found it necessary to coin a euphemism as devoid of meaning as "native advertising" tells you all you need to know about the ethics of these deliberate attempts to deceive.
    Duhroo-san
  • No wonder

    If queried, it is no surprise that website visitors will say advertisements add no value to a media site. Few individuals will admit to being fans of ads of any kind. The effectiveness of native advertising is not found in a visitor’s opinions of having ads on a site, but rather on whether or not they are clicking on these ads and staying on the website they clicked into. We’ve seen hard numbers demonstrating that visitors that click on ads are just as interested in the content as visitors that find it organically. Advertising is a medium that publishers need in order to monetize their sites, why not use a form of advertising that visitors actually engage around, instead of antiquated or irrelevant display ads?
    mshinkevich