Why Native Advertising Is A Game Changer

21 Jan Why Native Advertising Is A Game Changer

Example of New York Times' Native Advertising

Example of New York Times’ Native Advertising

Over the last several days I have been writing about the difficulty in selling online verticals, namely that most of  verticals are static and dull, our sales model is broken and we fail to consistently promote them.

Interestingly, the current buzz about native advertising may be just what the doctor ordered.

Here’s why: Nobody thinks they should charge for native advertising or sponsored articles on a cost-per-impression basis. Instead, everyone from BuzzFeed and the New York Times to local media companies is charging a value price – that is, the value that advertisers perceive in this approach.

We have seen prices that range from $3,100 annually per advertiser in a small market to $12,000 in medium markets for monthly native ads. Advertisers seem to “get” the value of native advertising and readily agree to the pricing in most markets. It’s a win-win for all concerned.

When boiled down to its essence, what is native advertising? It is a miniature online vertical.

Native articles are topical, focused and highly targeted.

If you are interested in plastic surgery that will make you look 15 years younger, you will eagerly read a native article about just such a procedure available in your own hometown. However, most people who aren’t interested in the procedure would not bother to read such a piece.

Therefore, page views for most native ads will be low, but those who do click on such an article are likely to be good prospects for the advertiser.

Native advertising is too new to be considered a proven technique yet. Still, its importance may not depend on how well it works, but rather on moving the industry away from price-per-impression pricing to value pricing.

Tomorrow: Native Advertising’s Secret Sauce