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What is Native Advertising and How It Works?


Native advertising trends in 2020 are going up with a speed of light. Ad formats that barely look like the actual ads and drive incredible user engagement are on the verge of glory.

Best native ad examples are still useful and unintrusive. They easily adapt to the format and characteristics of the website or app where they are located. Looking as a sophisticated recommendation, they organically weave into the context of the article, game, or any other type of content amidst which they are placed.

So what’s changed in 2020 then? If you are looking for the perfect native ads example in 2020, the great news for you is that you are no longer limited to sponsored posts or paid media content placements. Recommended content in the website widgets, social media posts, news feeds, and even banner ads have learned how to mimic the form and function of content.

The Business Insider states — native advertising will generate 74% of all digital ads revenues by 2021. In the U.S. revenues coming from native display ads will eventually reach $36 billion that translates into a 17% CAGR growth rate. Still can’t pinpoint the perfect example of a native ad for your campaign? Let’s try to do it together.

native display ad revenue

What is native advertising?

Native advertising definition involves any ad type – a picture, a promoted tweet, or post on a website or Facebook that visually adapts to the platform it is built into. That’s why unlike other kinds of advertising, it is not intrusive for users, so it doesn’t cause the immunity or blindness as banner ads do.

Examples of digital native ads can include in-feed ads on the website. Plus, native ads can be also disguised as editorial articles, “you may also like” posts in social media, or videos on YouTube.

best native ads samples

You can always spot digital advertising content by the following signature characteristics:

  • In contextual advertising, such ad formats are typically placed on niche websites in order to reach target audiences.
  • According to the FTC (Federal Trade Commission), it is obligatory for the native advertising to be appropriately marked in order to notify the users about the commercial origin of the material.
  • Native content always echoes the editorial content of the site.
  • Natives deliver valuable user information that harmoniously complements the overall content, looks, and feel of the resource.
  • The content always comes first, not the product.

The promotional part shouldn’t be obvious, that’s why natives typically don’t have calls to action.

Best native ads examples: what changed in 2020?

According to eMarketer by the end of this year (2020) advertisers in the U.S will spend $44 billion on native advertising and this is $8.66 billion more than they spent in 2019. With this, mobile native impressions account for almost 85% of the whole spending. If distributed by device, ad budgets mostly go to mobile and in-app ecosystems.

While in terms of formats everything remains pretty much the same, the big shift can be noticed in the ad purchasing methods. The share of natives placed on social media is slightly declining while the share of ads purchased programmatically is constantly increasing. By the end of 2020, native digital display ads will become less social but more mobile.

US native digital display ads dynamics 2020

Want to see native display ads example that generates high CPM? Thing is, the majority of formats like, e.g., content recommendation widgets, social media posts, news feeds can produce high CTR. Still, engaging advertising creative will play a big role since native promotion is delicate and works hand-in-hand with good content.

Stats that prove the success of native ads:

  • People watch natives 53% more often than banner ads.
  • This format produced $58,608 in attributable revenue for Magoosh Online Test.
  • Native ads that contain rich media can elevate conversion to 60%.
  • 32% of people who watched native ads are willing to share them with others (in contrast to only 19% ‘sharers’ who watched banner ads).
  • Native content is able to drive 40 times higher CTR than other formats.
  • Native ads show the highest click-through rates (1%) in such categories like: pets, food, drink, family, travel, technology.
  • Over 90% of customers, (especially Gen Z generation) prefer to read branded content on a regular basis.

CTRs of native ads by brand category

If you look at the best examples of native ad formats in 2020 you can notice that these units still deliver content that is useful for readers. These days people are loyal to such materials as long as those can be useful: as stats above illustrate, users are ready to read, share, and repost the content even when they find out it is actually sponsored.

The never-ending advertisers’ journey to higher brand awareness is what causes marketers to experiment with digital ad formats continually. Native ad is a format that helps to achieve better effectiveness through obviously lesser brand exposure. “Recommended” native advertising is very beneficial because it opens the opportunity for the advertisers to pay for the click/visit and expect that an ad will be shared through the variety of other resources.

Native advertising falls into six categories according to the IAB classification, but exactly in-feed ads, recommended, sponsored content, and search units are among those formats that keep the attention of advertisers in 2020, let’s find out why:

Content recommendation blocks

You can find a native ad campaign example featuring recommended content almost on any site. Such an ad unit works as a recommendation block “Read also”, “Another video”, “Interesting publications”. These suggestions, in the majority of cases, are recommended ad units that redirect users to the other sources where promoted materials are placed. Still, ad recommendation blocks are often placed among real editorial content in order to ensure good quality user experience.

Recommended content

Located at the bottom of articles like photos, or videos that match the subject, these ads can be personalized and served according to the interests of each particular user. Needless to mention why the recommended native ad is getting so popular – visit any website’s blog post, scroll it down, and find out the notice at the bottom – “Also recommended to you,” doesn’t it look magnetically clickable?

So, how to serve native ad formats with recommended content? For this advertisers usually choose content recommendation widgets. Ads placed in these widgets can be measured by the level of user engagement – views, number of shares, likes, and general on-page time. Native programmatic ad example below exemplifies how these widgets can be successfully implemented e.g on entertainment niche websites. Since programmatic advertising also targets the ad message according to the user data, it becomes possible to target only specific users and serve them relevant ads according to their characteristics (age, gender, geo, language, interests, etc.).

Content recommendation block sample

In-feed native ads & In-feed promoted list commerce

Native ad campaign examples featured below can perform well in the variety of ecosystems, including mobile and in-app. In-feed native ads are placed on the website’s feed, they match the feed’s appearance. This type of native advertising should not be confused with in-feed social ads as units are located directly on the website, not on social media.

In-feed ads are created according to the advertiser’s requirements in order to harmoniously fit into the editorial content. In-feed native ad units are getting increasingly popular due to the fact that their native content is usually placed in the vacant website’s corner that doesn’t merge with other kinds of ads – only side by side with editorial content.

In-feed promoted lists are oftentimes used on big e-commerce websites e.g like eBay in order to increase sales. Seeing a similar product alongside the selected one, the user will most likely click on the suggested item. Thus, more conversions and sales will be generated in the end.

In-feed sponsored content ads sample

When implemented correctly, in-feed native ads and in-feed promoted lists can demonstrate much higher CTRs compared to banner ads. Native programmatic ads example below features targeted in-feed ads on mobile and desktop. Again, in order to make those ads targeted, advertisers need to select a suitable audience, device, geo, and other characteristics on a programmatic demand-side platform.

In-feed native mobile ads

In-feed social ads

What is an in-feed social native ad? Such an ad can be located almost on any social media e.g like Facebook, Twitter, or Instagram. It appears in the form of a post typically placed in a specific community as this way the ad looks more natural. In order to make product placement successful, the advertiser should not only pick the right community but also assess the target audiences of it, user activity, habits, and post according to the analyzed behavioral patterns.

In-feed social ads

Planning native advertising on Instagram the advertiser should choose a popular account, posting on which will be optimal for the budget. Assess the reach, the niche, and the number of active subscribers of the influencer, after this compile your offer and get in touch with an Instagram influencer or community owner. The task of the publisher (influencer), in this case, will be to publish your materials, including the link to the site.

How to make those ads perform to the fullest? For this publishers will have to use several tricks of Instagram marketing including hashtags, links, and stories.

In-feed social video ads can become infectious and help advertisers achieve incredible brand awareness in a short time, especially if the product is creative or unique and is distributed through video formats. Examples of mobile native ads also include in-stream videos located inside of the article and rewarded video ad formats that appear inside of the game. Native video ads example posted in the stories (featured below) demonstrates how Lowe’s Edutainment Hacks used the format to show how to easily transform playroom for kids.

Sponsored content is the product of an agreement between the publisher and advertiser about generating and posting a certain number of articles during the period. The publisher promotes the advertiser’s brand by creating the branded content and receiving remuneration for this. In certain cases, advertisers create content independently without relying on the publisher.

Some advertisers believe that sponsored content is the ad type that corresponds to the native advertising definition the most as it helps to achieve the most natural, non-salesy feel.

Examples of the sponsored content can be easily spotted on The New York Times, The Atlantic, The Telegraph, The Independent, BuzzFeed, and other web sources.

Sponsored or branded content

It’s hard to ignore the native advertising benefits sponsored content brings. The top quality material usually fully corresponds to the target audience it was intended to be shared with, as well, it perfectly matches the style of editorial content.

Worth to mention, sponsored content is not limited to articles, it may involve videos, infographics, and games. Such ads can be found on almost all websites. Brands organize and pay for research, share their data, or come up with special projects with editors. Buzzfeed turned sponsored videos into a real trend. For example, the video they made for General Electric has gathered over 12 billion views a couple of years ago.

Below you can see examples of native ad in search results. These advertising snippets appear in search engines like Google or Bing when the user makes a query. These native ads are located at the top on the search results page and visually resemble organic search results. Thus, advertising pages located in the search results are considered to be native because they replicate the look of the page along with the function.

One study has found that although the links of native ads in search are highlighted in different colors and have captions, 40% of users fail to understand that these are ads. Senior people and those who aren’t particularly tech-savvy also have difficulties telling apart native search from organic search results. Examples of native ads in search should always have tags on them notifying the users about commercial content.

Native ads in the search will work great for those advertisers that implement location-based marketing campaigns and strive to hit users at the very moment when they search for products and services.

Native ads in search sample

Native advertising: digital implementation

Native programmatic ads examples featured above can serve as a basis for crafting your own advertising marketing strategy. Sizes and resolutions of native advertising formats are almost limitless and the performance rates of these ads are among the highest ones across the industry.

For the advertiser who strives to create really efficient native advertising campaign it is important to evaluate a bunch of native ad placement aspects beforehand:

  1. Form: How exactly the native ad will fit the website’s design? Where are the viewers active the most in-stream or out-stream?
  2. Function/Integration: Is native ad able to function the same way as the other website elements on the page where it is placed?
  3. Targeting/Buying: Where do you plan to place the ad: is there a specially designated section on the website you plan to target? If so, how do you plan to target such?
  4. Measuring results. Since the performance of the native advertising is measurable, how do you plan to derive analytics, which indicators will you apply?

Native advertising and programmatic can work very effectively together. Such a strategy combines the advantages of both advertising approaches. The advertiser gets the opportunity to show ads organically fitted into the site. These ads will be shown only to the large number of users whose characteristics are most suitable for serving impressions: geography, gender, age, interests, and other criteria. Still, even though each impression will be tailored to the particular user, the purchase of ad placement will be automated and the campaign itself will be optimized in real-time.

Seems complex but here’s how native advertising works if implemented programmatically: the advertisers can access a great variety of publishers registering at demand-side-platform (DSP) that interacts with supply-side platform (SSP- represents publishers).

DSP automates the process of ad buying in a matter of seconds and performs purchasing on behalf of the media-buyer. The benefits of native advertising purchasing through automated platforms are obvious, apart from predefining how future placement should look like, DSP platforms like SmartyAds enable advertisers to target specific websites the audiences of which are the most valuable for the advertiser (according to the geolocation and other criteria defined by advertisers).

There’s a way to define native advertising effectiveness to make sure that this or that native ad type goes along with your marketing campaign. On DSP you can easily track how eCPMs change during the selected timeline, track impressions, conversions, daily/monthly spend, and other performance indicators.

To sum up

If you look at any native ads example featured above, you can realize one underlying pattern. Although natives are so different, they can easily adapt to the website design and complement overall functionality. Native advertising, in the majority of cases, is not perceived as advertising, but rather as useful content the one can click on, share, and interact with. Using programmatic advertising platforms like DSP advertisers can launch and serve native campaigns on myriads of websites across the world. Publishers, in their turn, can neatly and naturally embed such units into content using SSP and monetize their inventory without risk to annoy loyal readers.

Making the most out of native advertising is what we’re best at, you can be too, sign in to SmartyAds DSP!


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