Although mobile native advertising seems like the next big thing, it still presents challenges, as does any new or innovative field. In this post, I will be discussing the challenges that key players in native advertising are currently facing and how we tackle these problems as a lock screen advertising platform. This post is the second half of our “Native Advertising on Lock Screens” series. In case you missed it, check out Part 1 for an overview of native advertising and the four major growth areas for mobile.
Challenges of Key Players in Native Advertising
Extra Creative Development Is Inevitable
The online advertising industry has been following its own standard set of creative guidelines in order to maximize efficiency and effectiveness. For mobile banner creatives, 320x50 is one of the recommended and most commonly used dimensions in mobile web and apps. 300x250 is also a popular format, especially for the mobile web. When planning mobile ad campaigns, advertisers are often asked to develop these standard banners; the consistency makes it more efficient, and moreover, these banners could be placed and interchanged throughout most of the mobile advertising real estate. Simple, right?
(Source: Interactive Advertising Bureau (IAB))
However, as native advertising grows, inputting additional effort in the creative development process is inevitable. For example, advertisers now need to develop additional creatives with dimensions of 1200x627 for advertising on Facebook. When you think about how much A/B testing is required in order to maximize ROI, this is not just about creating one more image. By simply adding one more creative unit size, the time and money you need to input may increase exponentially. On top of this, Facebook ads is one of the easier options available when it comes to the creative development process. Take New York Times advertorials or in-app advertising in messaging services such as LINE, for example: these require advertisers to prepare even more content, such as 3,000-word articles or completely different approaches.
Reach Is Still Limited
320x50 banners can be seen everywhere on mobile, from the portals of news giants to long tail blogs, thanks to the ecosystem built around this standard: ad networks and DSPs (Demand-Side Platform) provide advertisers with massive reach. In contrast, with the exception of Facebook, reach through native advertising can be very limited due to its non-standard format being incompatible with the existing ecosystem, implying that advertisers cannot get the reach they need for branding or targeting specific audiences. Only a few giant media publishers like Facebook have broken through this critical mass. Some innovators in the industry are trying to claim their positions in the newly emerging ecosystem of native advertising, but it will take a significant amount of time to get there.
Distrust Caused By Unfamiliarity
Most technologies and innovations are unable to avoid going through what is known as the “chasm” – unfamiliarity with a new technology or platform can cause distrust and severely hinder its adoption by the majority of users. It may perhaps take time for native advertising to take hold of advertising budgets. According to a survey conducted by Copyblogger, 49% of respondents did not know what native advertising was and 24% responded that they were “not familiar with it.” 91% of the respondents’ companies do not have a budget for native advertising.
Where is native advertising on this chart? Stuck in the Chasm? (Source: Intel)
Blurred Distinction Between Advertising and Content
As mentioned in Part 1 of our Native Advertising on Lock Screen posts, the New York Times’s native advertising experiment opened up the sensitive topic of crossing the line between content and advertising. The article criticizes the use of native ads as deceptive journalism, but there’s more than that: when users feel misled, they leave. The advertorial type of native ads is especially problematic, and it serves as a warning to other forms of native advertising. It is unacceptable to intentionally deceive users under any circumstance.
Not All Native Advertising Guarantees Excellent User Experience
In the end, advertising is still advertising. Even though native advertising is delivered to users in the same form and function of its original service, this doesn’t necessarily mean that users love it. For example, sponsored accounts in messaging apps send advertising messages to users who follow the accounts. If you, as a user, open the app and find it filled with advertising text rather than messages sent by your friends and family, you will likely feel very irritated. There is speculation that the reason Facebook launched its mobile ad network product is because they’re able to preserve user experience while earning more money by showing fewer ads on its own newsfeed and advertising on other publishers’ mobile web or apps instead. It is crucial to keep in mind that native advertising is still advertising and it is best to try not to annoy users.
Native Advertising Is Not A Moneymaker Yet
Yes, Facebook is generating tons of revenue out of its native advertising platform, but it is still hard to see the impact when this money trickles down. The advertisers’ challenges that I addressed above naturally lead to one big problem: lack of sufficient advertising demand. Also, the native advertising ecosystem has not evolved enough to enable advertisers to bid in a programmatic way or to buy audiences or inventories in a scalable way. Due to its underdeveloped ecosystem, publishers also cannot expect revenue optimization through mediation or SSPs (Supply-Side Platform) as well. Of course, there are some players aiming for a “Native Ads Marketplace,” but considering its fragmented advertising format, there is no immediate solution at this time.
How to Tackle These Native Advertising Challenges
1. For Advertisers
- Secure more inventory – this is the best way to convince advertisers to make a separate creative (but this is also the hardest part).
- Provide in-house creative production and operation, and include them in the original advertising bill.
- Offer access to a clear and transparent reporting system which is based on KPI that advertisers have already been using.
2. For Users
- Make a clear distinction between advertising and content – use tags or labels that clearly indicate which are advertising units.
- Never sacrifice the user experience and keep experimenting to find the sweet spot.
3. For Publishers
- At Buzzvil, we ourselves are a publisher working on native advertising. We believe that, in time, the native ad ecosystem will be developed enough to maximize revenue, just as the ecosystem has for traditional mobile banners. However, we need to make a strategic decision as to whether we should take a programmatic approach or not. Native ads can be considered as premium inventory and user experience is of absolute importance, and these may not be well-aligned with the programmatic scheme.
Let’s look at more specific strategies that we are using for native advertising on the first screen of mobile (the lock screen):
Characteristics of Lock Screen Advertising
- Full-screen high-quality images: We display ads on the entire screen of smartphones
- First glance: As the first screen of smartphones, lock screens catch a user’s first glance
- Always on: Lock screens are always on. Repeated and location-based contextual approaches are also available
Our Approach to Advertising Problems on Lock Screens
1. For Advertisers:
- We provide advertisers with in-house creative production services, which saves a significant amount of resources and money. We have highly experienced and talented designers on our team and have developed the know-how through operating in this field for over a year.
- We’ve built a transparent and real-time admin page for advertisers to access at any time in a bid to secure their trust.
2. For Users:
- The lock screen is a very personal space for users. We care very much about the image and content quality of our creatives and we restrict campaigns from buying our inventory if they don’t meet our criteria.
- Users can intuitively know what are ads and what is content. They can click (slide to unlock) advertising only when they want to.
The lock screen has not traditionally been a place where advertising pops up. It is a genuine challenge to persuade users to “rent out” their lock screens to us while encouraging them to continue interacting with it. It is just as challenging to convince advertisers to be open to something new and consult with us. The lock screen is an extremely valuable space with a lot of potential, so the Buzzvil team is prioritizing on innovative solutions and flawless operation to tackle the challenges as they come up. Thank you for reading! If you are interested in opportunities for lock screen advertising, please feel free to reach out to me at email@example.com. We currently have inventory in Korea and Japan and plan to expand globally in the near future!
The FOCUS series on our blog features specific projects and insights that we believe can change the rules of the game in the mobile industry. To learn more about Buzzvil’s core values, take a look on our website.
- #lock screen
- #Market & Industry
- #native advertising