This week’s roundup focuses on something we have known for quite some time: Social networks are thinking native. While that alone is not new, the decline of the banner and the ferocity and speed at which marketers are shifting away from it is astounding. According to the Reuters article below, Microsoft recently wrote off nearly all of the record $6.3 billion it shelled out for display ad giant aQuantive, which it purchased in 2007. These types of write-offs will (most likely) continue to happen, and these warning shots are being heard loud and clear across all industries.
To offset the banner decline, large brands, such as Pepsi and American Express, are beginning to shift their capital into social media platforms that are offering native advertising solutions — a space that has historically been populated by small to midsize companies. As Twitter and Facebook continue to refine their Promoted Tweets and Sponsored Stories, there should emerge more diverse advertising packages that could accelerate when more brands fully invest in native ad strategies. The articles by AllThingsD and ADWEEK do a great job at highlighting Twitter’s current strategy and hinting at what could be on the horizon.
Business Insider published an article by Sharethrough that focuses squarely on how native advertising is changing the New York City advertising ecosystem. From creative agencies, to media, to investors, to startups, native advertising is directly impacting every element of the advertising industry and creating a host of new opportunities and change.
Finally, Jack Krawczyk, Senior Product Marketing Manage at Stumble Upon, wrote about how people are currently consuming content on mobile devices (short answer: they consume it in small increments) and how native advertising will work into that framework.
Check out the articles below:
Business Insider - The Entire Advertising Industry Is Shifting To This Strategy - This isn’t your grandfather’s advertising industry. Native advertising is causing fundamental shifts in advertising and there is no bigger example than the changes occurring in New York, the heart of media and advertising. Creative agencies are coming up with new roles and departments to create for the native medium, investors are on the lookout for startups that can bring new value to the native ad world, and media agencies are wrapping their heads around a host of new metrics to understand ROI in the native advertising era.
Reuters – “The Display Ad Market Is In Big Trouble” – With smaller margins and less return, banner advertising firms are beginning to weigh down companies like Yahoo, Microsoft and others. Experts believe that this is attributed to the growing space offered by Facebook and similar sites (much of which is native). While some, like Microsoft seem sworn to stand by display, they are most definitely rethinking there overall advertising portfolio.
AllThingsD – “Twitter’s Pitch Deck for Big Advertisers” – A Twitter pitch deck appeared online this week, and it gave some insight into how Twitter is positioning itself and what they are offering to brands. Of most interest to people interested in native advertising is the anticipated addition of “interest targeting” to Twitter’s Promoted Tweet product. Also, Twitter’s comfortableness with mobile will make it an excellent candidate to engage in native across all platforms.
ADWEEK – “Twitter Loosens Up Its Paid Ad Requirements” – Twitter continued to stay in the news by disclosing that it has begun beta testing a new form of Promoted Tweets. In the past, a brand would have to send an organic tweet out to its followers before that tweet could be leverage for promotion, thus allowing the tweet to feel more like a true social interaction. In the new model (similar to one in development at Facebook), brands could create tweets that would appear as a Promoted Tweet without ever appearing on their timeline. While no announcement is imminent, keep an ear open.
TechCrunch – “Your Mobile Phone Is The Least Social Device You Own” – StumbleUpon’s Jack Krawczyk discussed why our mobile devices are built for quick engagements, not in-depth social interaction. According to Jack, our mobile devices are “gap-fillers” that we use when someone steps into the restroom at dinner, which makes them prime candidates for native monetization. With short use times, native advertising options such as Facebook’s Sponsored Stories or Twitter’s Promoted Tweets are key to making mobile apps more appealing to advertisers. Jack also argues that while scalability might be limited at first, native advertising is the key to maintaining a solid user experience.
Hope you enjoyed this edition of the Round-up, and as long as you continue to read, we will make sure to keep you informed!