Mixing Native Ads Generate Higher Engagement Metrics for Marketers

Feb 15, 2018

The range of native ad units now available has powered native ad spending past all other forms of display advertising in 2017, according to analysis from Poynter. But are all native ads equal for marketers and publishers?

To answer this question and gain a greater understanding of the range of native ad units, the my6sense data analytics team analyzed billions of recommendation widgets, in-feed, and in-ad native ad units served via my6sense’s white label programmatic native ad platform in the last 6 months of 2017.

On the supply side, recommendation widgets are the most profitable among the native ad units, followed closely by in-feed ad units, which are 20% less profitable than recommendation widgets. Recommendation widgets provide publishers with an effective way to recirculate organic content, which increases publisher engagement metrics including time spent and pages viewed while also generating revenue from the additional ads viewed. In-feed ads earn the highest revenue per ad but generate a lower RPM for publishers since recommendation widgets include multiple ads in the same ad unit.

In-feed units provide the supply side with a new revenue stream when they appear within content lists and articles. Among the three primary native ad units, in-ad units generate about a quarter of the revenue of recommendation widgets, yet are quick and easy to implement at scale on standard banner placements with no required layout changes, while they outperform traditional banner ads from both revenue and user experience perspectives.

On the demand side, in-feed ads generate the highest CTR and user engagement, 2.5 times greater than ads in recommendation widgets and about 10 times higher than ads within in-ad units. The ratio was similar when comparing effective CPMs for paid ad items across these three types of native ad units.

The strong performance of in-feed ads for brand campaigns is the result of the exclusive presence they receive as the only ad in view with larger images and longer texts, resulting in higher engagement rates. While in-feed ads dominate for branding campaigns, recommendation widgets and in-ad units, which are more cost-effective, perform better for direct response campaigns.

Though each of the three native ad units is unique, the best performing native ad campaigns for advertisers are those running with optimized A/B creative in recommendation widgets, in-feed, and in-ad units combined. And on the supply side, the combination of all three ad units results in the greatest revenue rates for publishers.

Recommendation widgets are the most popular form of native ad units (38%), followed by in-feed units (30%), in-ad units (25%) and finally textual and custom designs (7%).