In a recent article in Fast Company, GigaOM founder Om Malik posited that native advertising would work for social media platforms but not for traditional publishers, such as the New York Times. It’s a bold claim, given that native advertising primarily has been framed as a revenue option for struggling publications. Om argues from three basic points:
1) Traditional publishers don’t have audiences big enough to make native ads worthwhile for advertisers.
2) With all the different types of content available, there is no way to create a scalable native ad format.
3) Only social media sites have enough user data to target ads with any sort of precision.
ThoughtLeadr’s Take: There’s More to the Story
It’s worth mentioning that Om gets a lot of things right as he lays out his argument. He properly defines native advertising as “a sales pitch that fits right into the flow of the information being shown.” He also mentions Google paid search results as being one of the earliest examples of effective native advertising, which is true enough.
However, the reasoning that leads him to believe publishers won’t benefit from native advertising is based largely on false assumptions. We’ve seen first-hand that native advertising does work for publishers, and we have strong reason to believe native advertising capabilities will only improve in the coming years as platforms and publishers become more sophisticated. Here are a few thoughts from the team at ThoughtLeadr on parts of the story that Om might have missed:
All media is social
While the New York Times might not have as many subscribers as Twitter has users, what happens when readers enjoy a New York Times article? They share it via Twitter, Facebook, Pinterest, and other social media platforms, introducing the content to those sites’ larger user bases. Even TV shows are hashtagged, reviewed, and “live-tweeted” by fans as they air, blurring the line between broadcast and social media.
Thinking of traditional media as wholly separate from social media too easily dismisses the fact that, in effect, all media is social.
Platforms like ThoughtLeadr are making native ads scalable
Om lists a few common varieties of content as an example of why native ads aren’t scalable:
“Everyone’s diverse array of articles, listicles, photos, and slide shows is great for readers but inhibits native advertising’s growth because you can’t build a single repeatable format.”
However, you can build a repeatable format—by writing an article or listicle or creating a photo or slide show (we’ll also throw in video) and reusing that content across multiple sites. Will one piece of content be right for all publishers? No, but with minor tweaks, it might be right for quite a few.
Even the most “innovative” publisher’s content can be boiled down to an extremely simplistic metadata model. Let’s look at an article from GigaOM, for example. Here’s the metadata you’d need to place ANY publisher into that slot:
– Sponsor name (and URL to hyperlink)
– Posted on date
– Summary of post (aka, caption)
– HTML or markdown to represent the content of the post
Everything else can be pulled out into a reusable template. This isn’t rocket science—it’s just a CMS system that’s specialized for sponsored content.
Native advertising platforms like ThoughtLeadr specialize in putting together networks of publishers and using a CMS like this to make the content distribution process scalable while also adding human oversight to account for each publication’s tone and context. In our case, the same piece of content can be dynamically rendered in the visual style of as many publications in our network as make sense. The process is much more scalable than one might imagine.
What Om is really saying is that native ads aren’t as scalable or context-blind as display ads. On that point, he’s absolutely right. The thing is, that’s a major reason native ads work better.
Sophisticated native ad data is coming
As far as Om’s point that publishers don’t have the targeting capabilities of social media—well, he’s mostly right. The New York Times will never have the analytics technology to compete with Facebook, which is why traditional publications rely on companies like ThoughtLeadr to develop a scalable solution that covers multiple publishers. Still, up to this point, many native advertising platforms have relied on basic demographics or less to determine where to place ads within their networks, simply because that’s the only targeting data available.
However, in order to be as effective (and, again, as scalable) as possible, native ads need to be targeted based on a software understanding of the content and the context. In other words, native advertising platforms need a great deal of data about a publication’s readers—their interests, beliefs, behaviors, and even who common influencers are on the site—in order to target content in a sophisticated way. This hasn’t been possible so far, at least not on a large scale.
This is actually the pain point that brought ThoughtLeadr into the native ad space. We originally started (under a different name) as a big data gathering and prediction engine that could identify influencers and predict the outcome of comment threads on Reddit (how many people would comment, who they would be, whether it would be a positive or negative conversation, etc.). When we saw the need for this kind of sophisticated targeting in the native advertising space, we decided to launch a platform that, among other things, would allow us to provide highly specific targeting for our clients’ ads. That part actually is rocket science. (No, seriously, it was built by a former rocket scientist from the military.)
While we already use a scaled-down version of those analytics, our goal within the coming months is to apply this greater software-level understanding of community interactions to the publications within our network. This will give our advertising and publishing clients a much deeper understanding of their audiences and give us a way to target ad content much more specifically. We’ll release more information on this in the coming weeks and months.
The Bottom Line
While Om’s argument might seem logical from the POV of today’s industry, it assumes that native advertising will be a stagnant, rather than an evolving marketing practice. It’s never a good idea to bet against a market that is both lucrative and incentivized to succeed from all angles.
The fact is it’s early days for native advertising as an institution, and we’re poised to see a great deal of growth in the coming months and years. It’s true that there are gaps to be filled and processes to be optimized, but native advertising is already a profitable option for “traditional” publishers and social platforms alike. Soon, it will be a pretty sophisticated one, as well.