With the rising popularity of native advertising, more and more publishers and advertisers are considering testing it and trying to understand how it compares to the old-school banner ads and which is a better fit for them. In order to answer these questions, it’s essential to first have a good understanding of what each format is and how they differ from each other, as well as each of their advantages and disadvantages. Let’s get right into it.
What is display advertising?
Banner ads, also known as display advertising, are your typical ads from the early days of online advertising and still going strong. Display ads have evolved from static images to various types of banners that have interactive and clickable elements (e.g. rich media files). They come in many sizes and can be placed across various parts of the webpage. Find out more about the best-performing banner ad sizes in this article. Display advertising has both its advantages and disadvantages and can be used successfully for various marketing purposes. Let’s look at the main pros and cons of banner ads.
Pros
Simple setup
Banner ads are probably the most straightforward to design and implement. The variety of sizes makes them perfect for all kinds of websites and implementation is simple.
High visibility
The nature of display ads makes them clearly discernible from the main content on the page, which contributes to their high visibility, especially if a high-quality image is used or the ad is interactive.
High fill rates
As this is the most common type of advertising, the supply for such ads is high and ad servers universally accept banner ads. This adds up to great fill rates, depending mostly on how your price floors are set.
Cons
Banner blindness
Users are more and more accustomed to seeing banners on all websites they visit and nowadays many people have developed the habit of simply ignoring them. This is known as banner blindness and is, unfortunately, a growing concern for both marketers and website owners.
Low CTRs
Due to banner blindness and the generally lower match to users’ interests, display ads have rather low click-through rates. For example, Google Display Network has only 0.35% CTR on average for September 2021.
Blocked ads
Adblocking has become a major trend in the past few years and both publishers and advertisers are suffering from it. As banner ads are the most obvious type of digital advertising, they are usually also the trigger for users to install and activate an ad blocker.
What is native advertising?
Native advertising is characterized by the look, feel, and function of the ads, which are designed to match the sites on which they appear. Their non-disruptive form contributes to the improved user experience and natural appeal of the ads, which merge with the editorial flow of the page and seem to be part of the site’s own content. Due to the growing issue of banner blindness, native ads are gaining more and more popularity among marketers and have evolved into several common forms.
Types of native advertising
In-feed native ads
This type of native ad is positioned next to the original articles on the page and promotes external sponsored content. They appear as part of the usual newsfeed of the site, merging with the content.
In-article native ads
This format allows publishers to place ads in-between the paragraphs of their articles in a non-disruptive form, blending well with the page layout.
Recommendation widgets
There are various widgets developed specifically for the purpose of integrating native sponsored recommendations. They are usually positioned below the original content on the page.
Multiplex ads
This is one of AdSense’s native formats, previously called “Matched content”. Multiplex ads are designed to serve multiple ads in a grid within an ad unit. They can be customized to fully match the appearance of your pages and are similar to recommendation widgets.
Sponsored lists
This type of native ad usually appears on e-commerce sites and, as the name suggests, is essentially a list of sponsored products.
Now that you are familiar with the most popular types of native ads, let us examine their advantages and disadvantages.
Pros
Combat banner blindness
As native ads are intentionally designed not to look like ads, the chances that users will actually look at them are much higher. They blend right in and reach your users in a seamless, non-disruptive way that attracts attention, and as long as the creative is relevant, it won’t seem like just another annoying ad.
Better performance
Native ads have been reported to achieve higher viewability, engagement rates, and CTRs. For example, an eMarketer study shows that CTRs for native display ads are 8.8 times higher than those for standard display. As native advertising clearly works, advertisers are willing to allocate their budgets accordingly. According to AdYouLike, the global native advertising market is expected to reach over $400 billion by 2025.
Targeting and relevance
The higher engagement and overall performance that native ads deliver are by large due to the ability to target them to the right audience segment through contextual targeting. Users that are reading a culinary blog are more likely to be interested in an ad about cookware than any other group. The experience seems personalized and users are exposed to relevant and relatable content that they a very likely to be interested in.
Cons
Can be perceived as deceptive
They say “perception is reality” and this couldn’t be more true for the advertising world, both from the publisher’s and advertiser’s perspective. Once a user gets to believe that you are trying to fool them into clicking a ‘baity’ ad, gaining their trust back becomes really difficult. Quality native ads should not lead to such consequences, but it’s their execution that makes all the difference. Best practices include proper labeling and screening your native advertising partners.
May cause traffic fluctuations
While native ads deliver great results revenue-wise, they may sometimes result in traffic going down. Therefore, it’s crucial to keep an eye on the quality of the ads being delivered on your website in order to limit this effect. Having the right partners and controls in place makes all the difference.
Wrap up
Display and native advertising both have their up and downsides and while it’s clear that native is taking a larger and larger part of the digital spend pie, banner ads still play an important role in the industry. When used properly each can be a good fit for both publishers’ and advertisers’ strategies.