Banner Ads Trends and Native Advertising

There’s much debate over just what “native advertising” means. Talk to enough publishers, however, you’ll find agreement on one thing: it isn’t banner ads.

15 Alarming Stats About Banner Ads article tells the story of current state of banner ads. The banner ad is now 18 years old. It has become a symbol of all that’s wrong with online advertising: it stands out as an intruder on webpages; and it is mostly ignored by readers.

Here are some facts picked from 15 Alarming Stats About Banner Ads article:
1. Over 5.3 trillion display ads were served to U.S. users last year. (ComScore)
4. Click-through rates are .1 percent. (DoubleClick)
5. The 468 x 60 banner has a .04 percent click rate. (DoubleClick)
6. An estimated 31 percent of ad impressions can’t be viewed by users. (Comscore)
8. 8 percent of Internet users account for 85 percent of clicks. (ComScore)
9. Up to 50 percent of clicks on mobile banner ads are accidental. (GoldSpot Media)
10. Mobile CPMs are 75 cents. (Kleiner Perkins)

And yet banner continues to be a bulwark of the online advertising system. Many publishers would like to change that.

Native advertising is hot right now, even if nobody seems to know exactly what it is. Native advertising appears to mean different things to different people.

One definition: “a form of media that’s built into the actual visual design and where the ads are part of the content.” This Infographic Explains What Native Advertising Is and Summary of Native Advertising and Native Monetization 2011 – 2013 articles give a more detailed view.

You could summarize: Native advertising is the politically correct term for advertorial. Or rather, it’s an upgrade, the digital version of an old practice dating back to the era of typewriters and lead printing presses.

320 Comments

  1. Tomi Engdahl says:

    David Pidgeon / Mediatel:
    Guardian, in ad tech experiment, buys its own ad inventory, finds in some cases, it only gets 30% of the revenue — In worst case scenarios, for every pound an advertiser spends programmatically on the Guardian only 30 pence actually goes to the publisher.

    Where did the money go? Guardian buys its own ad inventory
    http://mediatel.co.uk/newsline/2016/10/04/where-did-the-money-go-guardian-buys-its-own-ad-inventory

    In worst case scenarios, for every pound an advertiser spends programmatically on the Guardian only 30 pence actually goes to the publisher.

    The revelation, announced by the Guardian’s new chief revenue officer, Hamish Nicklin, at the Automated Trading Debate on Tuesday (4 Oct), means a host of adtech businesses operating within the supply chain are extracting up to 70% of advertisers’ money without being able to quantify the value they provide to the brand.

    “There’s leakage. The money that goes in is not the same as the money that goes out,” Nicklin said.

    “There are so many different players taking a little cut here, a little cut there – and sometimes a very big cut. A lot of the money that [advertisers] think they are giving to premium publishers is not actually getting to us.”

    Nicklin said the Guardian had purchased its own ad inventory to try and assess where the money was spent across the entire supply chain and saw, in some instances, that only 30 pence was making it back to the publisher.

    “That’s not in every single case, but in worst case scenarios,” he said. “But the fact is it happens.”

    “That makes life very difficult for marketers and we’re getting to this stage now where less and less dollars are actually going on working media, and that’s a major challenge because the idea is to simplify efficiency and effectiveness and we’re actually going the other way.”

    The news comes as publishers face a host of threats born from the transition to online. July’s results from Guardian Media Group revealed its digital advertising was down despite growth in online readers, while almost all publishers are grappling with a growing threat from Facebook which is hoovering up online adspend by curating news content without carrying the burden of funding it.

    However, the idea that adspend is not being delivered on the working media will almost certainly raise eyebrows at the opposite end of the market as those spending the money wonder where it’s actually going.

    Reply
  2. Tomi Engdahl says:

    Ken Yeung / VentureBeat:
    Google acquires FameBit to better connect YouTube creators with brands — Google announced on Tuesday that it has acquired FameBit, with plans to leverage its technology platform to help YouTube creators better connect with brands. Financial terms of the deal were not disclosed.

    Google acquires FameBit to better connect YouTube creators with brands
    http://venturebeat.com/2016/10/11/google-acquires-famebit-to-better-connect-youtube-creators-with-brands/

    Google announced on Tuesday that it has acquired FameBit, with plans to leverage its technology platform to help YouTube creators better connect with brands. Financial terms of the deal were not disclosed.

    “We believe that Google’s relationship with brands and YouTube’s partnerships with creators, combined with FameBit’s technology and expertise, will help increase the number of branded content opportunities available, bringing even more revenue into the online video community,” said Google vice president of product management Ariel Bardin in a blog post.

    FameBit started out as a service that let creators network with brands in order to strike up sponsorship or partnership deals.

    Helping creators connect with brands
    https://youtube.googleblog.com/2016/10/helping-creators-connect-with-brands.html

    Reply
  3. Tomi Engdahl says:

    Josh Constine / TechCrunch:
    Facebook says its desktop ad revenue growth doubled to 18% YoY, largely due to thwarting of ad blockers, with desktop ad sales reaching $1.1B in Q3

    Blocking ad blockers boosted Facebook’s desktop ad revenue 18%
    https://techcrunch.com/2016/11/02/add-cash-plus/

    Facebook’s recent workaround for Adblock Plus and other ad blockers is already earning it money. On today’s blockbuster Q3 earnings call, the company said desktop ad revenue grew 18 percent year-over-year this quarter compared to around 9 percent in previous quarters, and that thwarting ad blockers was largely the cause for that boost.

    While Adblock Plus announced it would circumvent the ban, and temporarily did, Facebook nullified that change and has managed to keep ads flowing through Adblock Plus.

    Reply
  4. Tomi Engdahl says:

    Medium’s pivot catches publishing partners by surprise
    http://www.politico.com/media/story/2017/01/medium-pivot-catches-publishing-partners-by-surprise-004907

    On Wednesday, Medium co-founder Evan Williams announced in a blog post that the publishing platform would abandon its strategy to sell native advertising against premium publishers’ content and instead work on finding a new business model for online publishing.

    “We had started scaling up the teams to sell and support products that were, at best, incremental improvements on the ad-driven publishing model, not the transformative model we were aiming for … We are shifting our resources and attention to defining a new model for writers and creators to be rewarded, based on the value they’re creating for people,” Williams wrote in a post on Medium.

    Renewing Medium’s focus
    We’ve decided to make some major changes at Medium.
    https://blog.medium.com/renewing-mediums-focus-98f374a960be

    Reply
  5. Tomi Engdahl says:

    Jack Nicas / Wall Street Journal:
    Analysis finds Google placed ads for its own products atop 91% of 25K searches for related items; after Google was told, only 19% had Google product ads atop — A Wall Street Journal analysis found that Google often pushes its growing list of hardware products, from Pixel phones to Nest smart thermostats …

    Google Uses Its Search Engine to Hawk Its Products
    Google buys millions of its own search ads, competing with customers and promoting its products atop search results
    http://www.wsj.com/articles/google-uses-its-search-engine-to-hawk-its-products-1484827203

    Alphabet Inc.’s Google runs the world’s largest advertising business, selling space atop its search results. Google is also among the biggest buyers of those ads, promoting products from its music service to its app store.

    Reply
  6. Tomi Engdahl says:

    Ginny Marvin / Search Engine Land:
    Google’s 2016 “Bad Ads Report”: 1.7B ads removed compared to 780M in 2015, plus nearly 200 publishers banned from AdSense over misleading content like fake news

    Google’s 2016 Bad Ads Report: 1.7 billion ads removed, including fake news ads
    http://searchengineland.com/google-2016-bad-ads-report-268107
    The company says efforts to crack down on payday loan ads, ads that look like system errors and fake news ads were among those that led to an increase in removed ads in 2016.

    Reply
  7. Tomi Engdahl says:

    10 things marketers need to know about AI
    AI-enabled marketing isn’t just about cute chatbots. Here’s what CMOs, CIOs and others need to know to make the most of AI in their marketing initiatives in 2017 and beyond.
    http://www.cio.com/article/3168727/artificial-intelligence/10-things-marketers-need-to-know-about-ai.html

    Reply
  8. Tomi Engdahl says:

    Nanette Byrnes / MIT Technology Review:
    Synaps Labs to test image recognition tech in US this summer letting digital billboard owners target ads based on the car you’re driving, after trial in Moscow

    Moscow Billboard Targets Ads Based on the Car You’re Driving
    https://www.technologyreview.com/s/603743/moscow-billboard-targets-ads-based-on-the-car-youre-driving/

    The rise of digital billboards spawns the idea of targeted highway ads, with tests in the U.S. planned for this summer.

    Targeted advertising is familiar to anyone browsing the Internet. A startup called Synaps Labs has brought it to the physical world by combining high-speed cameras set up a distance ahead of the billboard (about 180 meters) to capture images of cars. Its machine-learning system can recognize in those images the make and model of the cars an advertiser wants to target. A bidding system then selects the appropriate advertising to put on the billboard as that car passes.

    Marketing a car on a roadside billboard might seem a logical fit. But how broad could this kind of advertising be? There is a lot an advertiser can tell about you from the car you drive, says Synaps.

    Reply
  9. Tomi Engdahl says:

    Alexandra Bruell / Wall Street Journal:
    Report: US digital ad spend to rise 16% in 2017 to $83B, as ad revenue of Snapchat to rise 158%, Facebook by 32%, Google by 15%, and Twitter to drop by 4.7%

    U.S. Digital Ad Market to Grow 16% This Year, Led by Facebook and Google
    Snapchat poised for “explosive growth” but will remain a small piece of the entire digital ad pie, according to eMarketer’s forecast
    https://www.wsj.com/articles/u-s-digital-ad-market-to-grow-16-this-year-led-by-facebook-and-google-1489489202

    Total digital ad spending in the U.S. will increase 16% this year to $83 billion, led by Google’s continued dominance of the search ad market and Facebook’s growing share of display and mobile ads, according to eMarketer’s latest forecast.

    Google’s U.S. revenue from digital ads is expected to increase about 15% this year, while Facebook’s will jump 32%, more than previously expected, according to the market research company’s latest forecast report.

    But Facebook’s furious growth is also starting to slowly shrink the gap with longtime digital ad king Google. As the overall digital ad industry expands, Google’s share of the U.S. market will shrink slightly to 40.7% in 2017, as Facebook steals share from competitors to reach 19.7% of the market, eMarketer predicts.

    Reply
  10. Tomi Engdahl says:

    Larry Dignan / ZDNet:
    Adobe launches Experience Cloud for enterprises, and unveils Advertising Cloud to help companies manage ads across search, social, mobile, and TV

    Adobe launches Experience Cloud aims to bridge from marketing to more parts of the enterprise
    http://www.zdnet.com/article/adobe-launches-experience-cloud-aims-to-bridge-from-marketing-to-more-parts-of-the-enterprise/

    Adobe is betting its marketing and analytics knowhow will apply to a broader part of the enterprise. Adobe will now compete more directly with Salesforce, Oracle, IBM and others.

    Adobe is launching its Experience Cloud, which combines parts of its marketing, analytics and content tools, with the aim of broadening its footprint for more roles and functions of an enterprise.

    And with the launch of Experience Cloud, Adobe is going to compete more directly with the likes of Oracle and Salesforce, two marketing and analytics players focused on customer experiences.

    The analytics and data driven approaches used by marketers are touching more parts of the business. “As we dig into this further, we can extend personalization into other parts of the business,” said Lindsay.

    This turf is well trodden. Oracle, Salesforce, Microsoft and IBM all have suites focused on customer experience. The catch is that each of these players come at it from their own approaches. Adobe’s Lindsay hopes the secret sauce for Adobe is its approach to data, content and analytics.

    Advertising Cloud will synchronize cookies across its cloud to better track inventory and brand safety to make sure ads run in the right places.

    Reply
  11. Tomi Engdahl says:

    Jessica Toonkel / Reuters:
    Advertisers try to scrub ads from Breitbart and other sites, resorting to double checking where their ads get placed by automated buying systems — Some advertisers are working overtime to scrub their spots from websites including Breitbart News, an unintended consequence

    Advertisers seek more control after unintended Breitbart spots
    http://www.reuters.com/article/us-advertisers-breitbart-blacklist-idUSKBN16S0D7

    Some advertisers are working overtime to scrub their spots from websites including Breitbart News, an unintended consequence of the automated ad buying systems that are meant to lower costs and allow for more targeted advertising.

    Those trying to keep their ads off certain websites are finding they must take steps to verify the spots they bid for are where ads actually appear and that there are no third parties involved that can result in ads winding up in unintended places.

    Reply
  12. Tomi Engdahl says:

    Elizabeth Dwoskin / Washington Post:
    Analysis finds ads for big brands placed on politically extreme and derogatory content across the web, highlighting broader issues with programmatic advertising

    For advertisers, algorithms can lead to unexpected exposure on sites spewing hate
    https://www.washingtonpost.com/business/technology/for-advertisers-algorithms-can-lead-to-unexpected-exposure-on-sites-spewing-hate/2017/03/24/046ac164-043d-11e7-b1e9-a05d3c21f7cf_story.html?utm_term=.03448cc46216

    What Ellis had stumbled on was a little-known facet of the booming world of Internet advertising. Businesses using the latest in online advertising technology offered by Google, Yahoo and major competitors are also increasingly finding their ads placed alongside politically extreme and derogatory content.

    That’s because the ad networks offered by Google, Yahoo and others can display ads on vast numbers of third-party websites based on people’s search and browsing histories. Although the strategy gives advertisers an unprecedented ability to reach customers who fit a narrow profile, it dramatically curtails their ability to control where their advertisements appear.

    “No one has any idea where their ads are going,” said Ellis. In some cases, he added, ad networks “are monetizing hate.”

    The Post’s examination found that the networks had displayed ads for Allstate, IBM, DirectTV and dozens of other household brand names on websites with content containing racial and ethnic slurs, Holocaust denial and disparaging comments about African Americans, Jews, women and gay people.

    Some of these sites, the Post found, featured hateful and derogatory content throughout. In others, it was confined to comment sections, where users went far beyond the language used by the sites’ writers

    “No business wants to be associated with sites like that,” said Andy Kill, spokesman for genetic testing company 23andMe. “If you’re trusting an ad algorithm to do this, this is what can happen,” he said. “It’s frustrating.”

    The problem has emerged as Web advertising strategies have evolved. Advertisers sometimes choose to place their ads on particular sites — or avoid sites they dislike — but a growing share of advertising budgets go to what the industry calls “programmatic” buys. These ads are aimed at people whose demographic or consumer profile is receptive to a marketing message, no matter where they browse on the Internet. Algorithms decide where to place ads, based on people’s prior Web usage, across vastly different types of sites.

    Many of the companies contacted for this story — including IBM, bareMinerals, Macy’s, Everquote and Allstate — expressed surprise and dismay that their ads appeared near derogatory content.

    Some advertisers also expressed frustration that ad networks had failed to keep marketing messages from appearing alongside reader comments that might upset customers — even on sites that themselves do not promote extremist content.

    ‘It’s whack-a-mole’

    The issue of ad placements has become charged in an era of rising political polarization. The number of right-wing hate sites, as well as sites that traffic in sensationalist news and hoaxes, has doubled over the past year, according to ad auditing firm DoubleVerify.

    With so many new sites, it’s difficult for advertisers to avoid having their ads appear in unwelcome places. “It’s whack-a-mole,” said Wayne Gattinella, chief executive of DoubleVerify. “You can flag keywords. You can use algorithmic decision-making to minimize it, but there is no way to filter the word choice in real time.”

    Reply
  13. Tomi Engdahl says:

    Tess Townsend / Recode:
    YouTube’s ad mess gives advertisers leverage for what they really want: More data

    YouTube’s ad mess gives advertisers leverage for what they really want: More data
    Advertisers are tired of just trusting Google.
    http://www.recode.net/2017/3/24/15015070/google-ad-controversy-advertisers-leverage

    As far as advertisers are concerned, there are really only two ways to place ads online: The “open web” where you can track the ads, and “walled gardens” where you can’t.

    Google falls into the second bucket.

    That means marketers have had to trust Google to make sure their ads are doing what they’re supposed to do, including appearing in the correct places. But after they discovered last week their ads were funding YouTube videos containing hate speech and extremist messages, they suspended their business.

    Here’s where it could get interesting. Advertisers now have some leverage to try to get what they really want: More data.

    Google did announce this week it would give advertisers more control over where their content goes and do more to police which YouTube videos would be eligible for ads. Still, the details of what Google is willing to give is still being hammered out, sources say.

    Reply
  14. Tomi Engdahl says:

    YouTube’s $25 billion ad problem
    That sounds pretty bad! But it could be much worse for Alphabet and its investors.
    http://www.recode.net/2017/3/23/15035524/youtube-google-advertising-25-billion-market-cap

    Big advertisers are punishing Google over its YouTube problem by pulling some of their ads.

    The good news for Google and its Alphabet parent company: This won’t hurt Google’s core ad business.

    The bad news for Google and its Alphabet parent company: Investors are worried anyway.

    Here’s what the second part of the equation looks like: GOOGL shares are down more than 4 percent since Friday, when news reports about big brands’ ads running against offensive YouTube videos really got going. That means Alphabet has lost about $25 billion in market cap in less than a week.

    Reply
  15. Tomi Engdahl says:

    Burger King’s new ad forces Google Home to advertise the Whopper
    Oh no, Google
    http://www.theverge.com/2017/4/12/15259400/burger-king-google-home-ad-wikipedia

    Burger King is unveiling a horrible, genius, infuriating, hilarious, and maybe very poorly thought-out ad today that’s designed to intentionally set off Google Homes and Android phones.

    The 15-second ad features someone in a Burger King uniform leaning into the camera before saying, “OK Google, what is the Whopper burger?”

    For anyone with a Google Home near their TV, that strangely phrased request will prompt the speaker to begin reading the Wikipedia entry for the Whopper. It’s a clever way of getting viewers’ attention, but it’s also a really quick way of getting on viewers’ nerves

    Reply
  16. Tomi Engdahl says:

    George Slefo / Ad Age:
    Google, Microsoft, major ad buyers and publishers coordinating on ad blocking plan, says Coalition for Better Ads’ counsel, who expects a rollout by end-of-year

    Ad Industry Powers Consider Adopting Ad Blocking on a Wide Scale
    http://adage.com/article/digital/biggest-players-ad-industry-move-kill-worst-ads/308747/

    The biggest players in advertising and tech are mapping out a strategy to kill off the digital ads that have been deemed as the absolute worst by consumers.

    The most likely approach is the adoption of a “technology” — the term “ad blocker” has baggage among many of the participants in talks on the subject — that would prevent browsers such as Google Chrome or Microsoft Edge from displaying autoplaying video ads with sound, pop-up ads and ads that quickly flash or change colors.

    The discussions are taking place among members of the industry’s Coalition for Better Ads, including Google, Microsoft, Procter & Gamble, Unilever, WPP’s ad-buying giant GroupM, Facebook, Thomson Reuters, The Washington Post, the Interactive Advertising Bureau and the Association of National Advertisers, according to Stu Ingis, counsel to the coalition and attorney at Venable LLP.

    “The end game here is to remove these types of ads which are undercutting the consumer internet experience,” Ingis said. “Truthfully, those ads can potentially and seriously undercut the broader internet ecosystem.”

    A “blocking mechanism” or “technology” to prevent such ads from appearing will be put into place before the end of this year, Ingis predicted.

    Reply
  17. Tomi Engdahl says:

    All the world’s a context: Targeted ads go offline
    https://blog.kaspersky.com/offline-tracking-ads/16510/

    Targeted ads are all over the Internet nowadays. One minute you’re searching for information about hair loss, the next you’re seeing offers for a remedy. Click the Like button on an article about genetic tests and you’ll see discounts for that kind of test. Advertisements on the Internet reflect the collected knowledge of everything the target — you! — have liked, searched for, and seen online, and this “diary” of your online life paints a pretty candid picture of you, too.

    At this point, seeing ads based on your online history is hardly a surprise — at least, not while you’re online. So here’s something new to get used to: targeted ads on the street, in stores, and in our cars

    You’re easy to target

    First of all, you should know that you are being counted. The owners of stores and shopping centers want to know how many people walk past a store and how many go inside. Those who pass by are counted by cameras, motion sensors, and floor-pressure sensors. People who stand in check-out lines are counted separately to help stores optimize the number of employees.

    Second, your movements are tracked. Your own smartphone is used as a radio beacon. By measuring the signal strength to several access points, marketers can pinpoint your location to within several feet (the best algorithms are accurate to a few dozen inches). In online marketing parlance, it’s called the customer journey — and it’s important data for marketing purposes. Offline you can call it the same — but literally.

    Third, salespeople are trying to find out as much as possible about you. General information about a person and their habits and interests can be acquired by studying their purchase history and social-network profile data (we’ll talk later in this article about how they access the profile). Modern image-recognition systems can guess the gender and approximate age of a visitor simply by taking a look at them through a camera lens.

    How marketers track and sell

    One of the most popular and effective methods for tracking potential and existing customers uses wireless (Wi-Fi) networks.

    The list of data collected includes:

    Information from a social media account and the credentials (for example, an e-mail address) used to connect to the network;
    A history of websites visited over the wireless network;
    The technical specifications of the visitor’s smartphone, including IMEI number and phone number;
    The location of the visitor within the shopping center.

    Reply
  18. Tomi Engdahl says:

    George Slefo / Ad Age:
    Google says it will preinstall an ad filter in Chrome starting early 2018 aimed at ads deemed “annoying” by the Coalition for Better Ads — Google’s Chrome browser will soon come with preinstalled technology that will block the most annoying ads currently marring the web experience, the company confirmed on Thursday.

    Google Chrome Will Automatically Block Annoying Ads
    http://adage.com/article/digital/official-google-chrome-ad-blocker/309238/

    Google’s Chrome browser will soon come with preinstalled technology that will block the most annoying ads currently marring the web experience, the company confirmed on Thursday.

    Publishers will be able to understand how they will be affected through a tool Google is dubbing “The Ad Experience Report.” It will basically score a publisher’s site and inform them which of their ads are “annoying experiences.”

    At the same time, Chrome will give publishers the option to force a choice on people running their own ad blocking software: whitelist the site so its non-annoying ads can display or pay a small fee to access the content ad-free.

    The moves, which had been anticipated since word got out in April but hadn’t been previously confirmed by Google, will impact the entire advertising ecosystem because Chrome is the most popular web browser for both desktop and mobile.

    “We’ve all known for a while that the ad experience is a real problem, and that it’s confused and angered users,” Sridhar Ramaswamy, senior VP of ads and commerce at Google, told Ad Age. “We realized solutions like ad blockers punish everybody, including publishers who develop great content and are thoughtful about the ad experience they put on their site.”

    Google isn’t calling its technology an ad blocker, instead classifying it as a “filter” that removes the ads that consumers hate most. These include popups, ads that flash quickly, change colors or force people to wait 10 seconds before accessing content on a publisher’s page.

    Reply
  19. Tomi Engdahl says:

    Chris Welch / The Verge:
    YouTube updates “ad friendly” guidelines, takes a stronger stance on hateful and demeaning content, and inappropriate use of family entertainment characters

    YouTube adds more details, and restrictions, around which videos can be monetized
    More guidance for video creators and three new types of ad-unfriendly content
    https://www.theverge.com/2017/6/1/15726092/youtube-ad-restrictions-offensive-content-monetization-hate-inappropriate

    YouTube is taking new steps today to get a handle on content that might offend advertisers or, conversely, prevent a YouTube creator from monetizing their videos. Several major brands left the platform’s ad program recently to avoid being linked with hateful and offensive videos. And many creators were upset when videos they saw as benign started to be de-monetized.

    YouTube has promised to give advertisers greater control over where their ads appear and to give creators a better sense of what they need to avoid if they want their videos to make money. Today the video service is expanding its creator guidelines on what constitutes an “ad-friendly” video, offering up more details about dos and don’ts, and, importantly, adding three new categories of videos that won’t be eligible for advertising.

    YouTube is trying to walk a careful line with these new guidelines.

    Lesson: Making advertiser-friendly content
    https://creatoracademy.youtube.com/page/lesson/advertiser-friendly?cid=earn-money&hl=en&utm_source=blog&utm_medium=blog&utm_campaign=june-2017

    If you’re interested in earning money from ads on YouTube, it’s important to understand YouTube’s ads policies and how advertisers choose where their ads appear.

    Reply
  20. Tomi Engdahl says:

    The effect of exposure to sexual appeals in advertisements on memory, attitude, and purchase intention: a meta-analytic review
    http://www.tandfonline.com/doi/abs/10.1080/02650487.2017.1334996

    analysis revealed a significant positive effect for sexual appeals on ad recognition and recall (weighted Cohen’s d = .38, p < .001), but the effect on brand recognition and recall was not significant (d = .09, p = .30).

    Reply

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