Forbes and Sharethrough have released a new study, "Going Native, How Marketers are Reinventing the Online Video Advertising Experience," which assesses adoption trends related to native video advertising for major brands. They found some interesting trends emerging in terms of what these major brands are using, where they are buying and what capabilities they desire for online video and content advertising. First off, a quick primer on "native video advertising."
The Natives are Restless? Defining "Native Video Advertising"
First off, I had to read through some of the results to understand what they were talking about in regards to 'native advertising formats' and 'native attributes.' As a note to other researchers, if you are going to use some phrase like that, it's best to actually explain it in the results. Essentially, they are talking about native as in, hidden in plain sight, created as part of the user experience, as opposed to interruptive or in standard ad placements. In essence, they're talking about social video advertising, promoted videos, promoted Tweets, promoted stories on Facebook, basically any paid placement of a video ad such that it slides into the natural, or native, user experience on a site, versus interruptive like a pre- or mid-roll in-stream ad.
In terms of native attributes, it seems to be mostly about advertising targeting and delivery and social sharing that is all inherent into the user experience. For example the share option on Facebook, the Retweet on Twitter, etc, etc. Here's a graphic from Sharethrough that outlines a framework for "native advertising".
So when you see these images below, you know what they're on about. Now on to the methodology. Oh hey, before I do that, you know that Sharethrough is a native advertising platform, right? So please have a large grain of salt close at hand for some of this.
The Forbes Insights/Sharethrough survey tapped 136 marketing executives during September 2012. Forty-six respondents came from companies with revenues between $500 million and $1 billion, and the rest from companies with revenues of $1 billion-plus. Fifty-nine survey respondents had titles of director and up. Roughly half described their business outlook in positive terms, and about two in three said that
their media budgets were at least $1 million. The vast majority (99 percent) are located in the United States.
So they spoke mostly with the upper echelon of brands with massive media budgets considering that 66% are putting $1 million or more into it. But with just 136 respondents, it's hard to extrapolate out to the larger industry. The brands mentioned include Intel, JetBlue, Heineken and Honda. I'm trying to remember the last time I saw a video ad for any of them on online and I'm drawing a blank. In fact, only 12% indicated they had bought native video advertising for distribution of brand videos. That could explain why I can't remember seeing any. 49% did say they hadn't but were planning on it, so nearly 40% are seemingly uninterested in it.
Native Video Ad Content Trends
Length seems to vary widely in the digital video advertising campaigns of these major brands. While 61% said they are using custom-made 15- or 30-second video, 28% said they are simply repurposing TV commercials. As many of us know, that's not the best way to do things. The more interesting fact in all this is that 41% are using long-form video, as in branded content. That's a pretty cool statistic right there.
Full Syndication Features Required
The survey seem to ask about what is desired in terms of syndication features and the numbers are pretty remarkable, even for a small slice of the industry. For example, it seems that 61% want the ad placement to look just like the rest of the page it's on. Well, of course they do. After all, if you tell a user it's a promoted video, they have a good idea it's an ad trying to wrap itself in friendly clothing. If you were to remove the requirement that it stand out, I think you'd see a lot of ire on the part of the users not to mention some further regulation by the government (more on that in the conclusion below).
Native Brand Video Syndication Features
Along those lines 60% want it embedded in the site as opposed in an ad banner position which is no surprise. The big surprise is that 53% are interested in user-choice versus interruptive. But we all know the power of allowing the user to decide whether or not to watch a video ad. 52% also want it to be stand alone content and not in-stream via pre/mid/post-roll.
Most Valuable Attributes of Online Video:
In terms of all of these sorts of attributes, brand-safe content delivery was the most favorable with 65% agreeing it was most valuable. 60% also said that aligning their content with premium site content was key, 57% said choice-based, 51% said custom integration for visuals and 46% said the ability to drive sharing of content.
Desired Results of Native Advertising
Of course the whole point of online video advertising is to obtain some sort of results. Within the scope of this survey, the main objectives were raising brand awareness, branding (of premium content?) and customer retention and loyalty. Oddly, customer acquisition was quite low with just 26% and brand affinity or advocacy was just 30%. So it seems like they don't care if you buy or even like the brand, just so long as you see it and hopefully share it.
For paid video syndication things are a bit different. Brand lift in terms of purchase intent or awareness was key with 75% saying that was how they determined success. Reach and frequency were pretty decent with 54% using that as the main metric for success. One-third said sharing and another third said building buzz was important.
That's a Wrap
I actually got to say that exact phrase this week. But here it's more about what you should be doing if you're a premium content publisher and want to attract major brands with some native advertising options on your site or service. Again, the insights provided by this report are to be taken with the caveat that it's from a company that has a 'native advertising platform,' and is based on a survey of just 136 brands. But clearly there are some interesting insights from the study that we can learn from and it further confirms the importance of online video to brand advertisers shows a continued interest in online video. Overall, it's clear that trying to put the advertising content into the flow of the site and not making it look like advertising is vital to these brands.
Moving Forward - Native Advertising, Disclosure, and the FTC
Now, we've already seen some backlash from users in regards to this sort of sponsored advertising. Facebook seems to be charging brand pages to have their status updates sent to all of the people who are interested. Seems like an odd way to do it, since liking the page pretty much is asking to be kept up to date in the first place. Meanwhile, promoted videos are showing up all over the place on YouTube and promoted Tweets are as well. Honestly, it's not fooling anyone, we all know it's a paid advertisement when we see it was promoted. I'm sure if some brands had their way, you wouldn't even see that fact, which to me would be extremely deceptive.
I went looking for what the Federal Trade Commission has to say about such things and found an interesting letter talking about search engines and paid placements.
Here's the gist of the conclusion:
In short, the staff is recommending that all search engine companies review their Web sites and make any changes necessary to ensure that:
- any paid ranking search results are distinguished from non-paid results with clear and conspicuous disclosures;
- the use of paid inclusion is clearly and conspicuously explained and disclosed;
In fact, they're contemplating a full blown investigation into the flaunting of its rules in this regard. That could explode and trickle down to native advertising as well which is, essentially, the same thing. When someone goes to their Facebook wall, they are expecting to see a subset of information that they have in some way, shape or form, agreed to receive. By injecting paid placements into that feed and then calling it featured or promoted it doesn't really sound like it's a paid ad placement and that could easily turn the ever-watchful eye of the FTC squarely upon native advertising. It's no different than a website or blog paid to either write or publish an article about a brand or product but a company to me and so it must be regulated in the same fashion.