AdAge – Brands that want to run a successful native ad campaign might have to pay as much as $450,000 for a six-month run.
But that might be a bargain, as marketers who cough up the cash are happy enough that they return at a rate significantly higher than the industry norm.
According to MediaRadar, a sales intelligence company, publishers see an average renewal rate of 33% for native ad products when campaigns run for less than six months. But news outlets like the Wall Street Journal, for example, see renewal rates of 72%.
The key difference, MediaRadar says, is the length of the campaigns.
“One of the things the successful publishers all have in common is the duration of the campaign,” Todd Krizelman, CEO of MediaRadar, said.
“What we observed is in that time period of six months, the publisher has more time to course correct,” Mr. Krizelman said. “In the grand scheme of things, native is still in the early days, so this concept of how you execute your best practices isn’t perfected.”
The world’s best publications charge brands as much as $75,000 a month for the privilege of running sponsored content on their website, according to industry insiders.
The company says it’s tapped into the data from its 1,600 customers to determine what works when it comes to native advertising.
Mr. Krizelman says native ad campaigns that run longer are “highly, highly correlated,” as it allows publishers to tweak creative and put more time to adjust client need.
Native ad units and sponsored content both fall under the umbrella of “native advertising,” Mr. Krizelman said. “These two shouldn’t be called the same thing,” he said. “But the market doesn’t talk about them that way so we need to conform to the market.”
In most cases, sponsored content isn’t aimed at garnering clicks or impressions, but instead changing brand perception and that takes time to achieve, Mr. Krizelman said.
Also fueling the rise of native advertising are publishers who’ve snapped up digital marketing agencies to help service their clients.
The Financial Times, for example, is using Alpha Grid to create content for its customers while maintaining separation of church and state with sales and editorial. “These publishing companies didn’t have these kinds of staff before,” Mr. Krizelman said. “They like the idea of having a separate agency internally that has the responsibility of creating the ad creative.”
Meanwhile, brands that buy native ad units see four to five times more engagment when compared to buying traditional banner units, MediaRadar said.
“Big picture, I think this matters more than anything,” Mr. Krizelman said. “There is a rise in ad blocking, so I do think native is an example of innovation where media companies are still testing and trying to figure things out.”
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