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Native advertising spends to double up globally: Experts

28-December-2017
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Native advertising spends to double up globally: Experts

Thanks to the rise of click-bait and the milieu of in-your-face ads, the antipathy towards advertising is getting alarming. In an era where consumers are susceptible to ad blockers and are seeking interruption-free experiences, how do marketers and advertisers still make their brands get noticed? Given this current scenario, the time has definitely been on native advertising’s side which is all about embedding a brand seamlessly in the context of a user's experience for maximum engagement.

Integration versus interruption

Industry experts agree that native advertising is turning out to be an attractive prospect for advertisers. In fact, global native advertising spends are set to double in the next few years—increasing from $30.9 billion in 2015 to $59.35 billion in 2018—as per the Native Advertising Institute.

Gaurav Mishra, Digital Director, Conde Nast India believes that native advertising has become an integral part of advertisers marketing plans, especially for lifestyle brands. “Increasingly, advertisers are looking to partner with publishers to design long-term content properties to engage the users in the journey from content to community to commerce,” says Mishra.


Sanjay Mehta, Jt. CEO at Mirum also feels that given the non-intrusive nature of native, it looks like a good option for advertisers to pump their money into space. “It’s become necessary because regular advertising is getting too much in your face and people are rejecting it. So with native, there is a better chance of people consuming the communication and it’s increasingly a better option,” he opines.

According to Priyadarshi Banerjee, General Manager – Product strategy, Worldwide Media native advertising is definitely picking up. “From our personal experiences and talking to a lot of advertisers, the kind of investments that are happening out there in the market, it’s evident that pure-play display is actually going down. A lot of that money is being replaced by native, “ says Banerjee.

The ROI game

Mehta believes that ROI through native is better than normal display advertising because click-through ratios are better. ‘’If done well, it’s can fetch good ROI,” he says. However, Banerjee feels that it’s difficult to judge the efficacy of native only from a commercial perspective. “There is also a lot of engagement it brings and a lot of recall. This ROI here is not just returning on investment but also return on influence,” he says.

Kaveri Jain, Head of HT Brand Studio and Digital Marketing Lead which produces native advertising for Hindustan Times says that from a purely academic sense, native is supposed to be brand agnostic and product agnostic. “It is content that people will like to read and engage with. An ROI built into that becomes a problem,” she opens up.

Picking up steam?

Experts believe that the importance of native advertising in the ad revenue mix is slightly increasing. Jain believes that people are slowly shifting their moneys to native. “From their whole marketing spend, it’s been 2-10% which is not very high but increasing slowly. Whether you look at the Scoopwhoops of the world or traditional media, they are sitting on native content for their revenue generation,” she says.

Mehta also maintains that on a typical media plan approx 10% ad spends are devoted to native. “It now contributes to half of our digital revenue,” reveals Mishra. Banerjee seconds that. “From a lifestyle publisher’s point of view, when we started off the year, we were projecting 10-15% of our revenues coming from native. As of now, we are looking at 30-35% which is already come from there. So the contribution of the native ad to digital revenue has been substantial and if you actually add videos to that, videos that form a part of our native deliverables then it goes up to a 60-70%, so you are looking at more than half of the business in digital coming from there,” he speaks.

The right way to go native

However, the question that begs to be answered is that, are brands getting slick at doing native? Jain doesn’t agree much. “It is at a very nascent stage in India. Nascent to the point that the market is still exploring what it really is,” she explains. She opines that the biggest dilemma which most companies are dealing with is figuring out what native does for them. “That’s an answer which is going to take some time to come. The problem is that when brands sort of end up doing a hybrid model where they want to do native but bring in their brand subtly, something gets lost somewhere which is a problem I have been facing when I go to brands with content ideas, “ she explains.

Says Rohit Ohri, Group Chairman & CEO, FCB India, “The fact that there is a true integration of the advertising message into the content, into the platform, we haven’t seen much of it in India at least. We are still at the start line in a way.” He points out that it’s a matter of the market maturing and integrating the product just right.

“We need more involvement on the part of marketers of the brands and not just agencies,” concludes Jain. Experts contend that not only is a more collaborative effort required between marketers and agencies but also suggest that the contextual relevance of the content inside drives its performance.

Expert speak

Neena Dasgupta, CEO & Director, Zirca Digital Solutions

"While consumers have become savvier about how they consume content, advertisers and publishers are looking at new communication formats and ad formats to ensure higher audience engagement with their content. This is fuelling the rise of native advertising.”

Harish Bijoor, Brand-expert & Founder, Harish Bijoor Consults Inc.

”The key to native advertising is the fact that it must not look like advertising, but must be paid for. This means that native advertising needs to be stitched into the DNA of the publication or the medium being used. That's where creativity and creative-subterfuge resides. Most do not invest in this process.”

Malik Gilani, Founder &CEO- ESAR Media & Advertising
“With Jio on board as a premier data provider, the native advertising revenue mix is in a good shape.”

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