Mobile Advertising Forced to Go Beyond Banners

The last time the New York Times was in the news (instead of the source of news), I was appalled and confused by their suggestion that readers add peas to guacamole. Recently, however, the so-called guacamole ruining publisher was in the news for something that won me back –their latest native mobile advertising offerings. Native advertising and mobile advertising are certainly not new ideas, and neither is native mobile advertising. But, with the increased use of ad-blocking software, publishers now have to circumvent the lost revenue by turning to native ad units. At the moment, it is interesting to observe why and how publishers are being forced to deal with the growing distaste for mobile banner ads and the successes of native advertising in its place.

First, let’s review why it is necessary for publishers to shift their mobile revenue focus from banner units to native units. During this year’s Worldwide Developers Conference, Apple announced that iOS9, the new operating system for iPhones and iPads, will include an adblock feature. According to a 2014 study by Adobe, there are already 140 million adblock users around the world who manually installed the feature. If Apple includes the feature on iPhones and iPads, many more users will likely opt-out of being served those pesky mobile ads that seem impossible to exit.

Another reason why publishers are retiring most mobile banner ads is to improve user experience. Most mobile phones do not have enough space for banner ads, so the ads take up more of the screen than users would like. Users may get frustrated as they unsuccessfully attempt to close the ad and end up leaving the page all together. Even advertisers tend to steer away from mobile ads. DigiDay wrote, “Mobile’s combination of poor targeting and tracking capabilities and lackluster creative opportunities have given advertisers no real reason to invest in the medium.” For publishers, mobile ads are not the highest valued units either. Most mobile ad inventory is sold through exchanges and networks (Marshall), driving the costs down and generating low revenues. Needless to say, mobile banner ads are not popular and publishers need to find an alternative fast.

With the demand for higher quality mobile ad units, many publishers are challenged to think outside of the box and come up with creative ways to expand their mobile advertising offerings. From June of 2014 to June of 2015, the number of apps using native ads increased by eightfold (figure 1). Big-name publishers, such as the New York Times and Yahoo, are retiring the interruptive mobile banner ads and introducing new mobile ad formats. Many of the new formats will mimic the in-feed content ads that have been standard on Facebook and Twitter. With publishers’ amplified efforts to improve mobile ads, users will likely find their user experiences more enjoyable.

For example, the New York Times will soon be releasing an offering called Mobile Moments, which will customize ads to align with the seven moments in a day that are most important to its readers (Peterson). Ads served in the early mornings will be text-based to match text heavy news articles. In the evenings, when news articles are presented in more entertaining layouts, ads will be served with pictures and videos. With the ability to choose which moment of the day to target ads, advertisers might be more inclined to buy these mobile ad units directly rather than through an exchange or network. By putting more thought into improving user experience and creating valuable mobile ad units, publishers increase their opportunities to have direct relationships with advertisers and keep audiences satisfied.

The benefits of offering native units are abundant so publishers and app developers should be motivated to think beyond the basics with native mobile advertising. During SXSW in Austin, Texas, Tinder’s native campaign created an account for an AI character in the movie and allowed users to match with her, talk to her, and eventually discover she was a robot. The advertisement seamlessly fit with Tinder’s unique look and feel, while still staying true to the central theme of the movie and target audience. Like Tinder, many publishers and app developers are blending research and creativity to create and offer ads units without the limitation of standard specifications. It will be fascinating to observe how native mobile advertising will expand over the next couple years, now that publishers are moving far beyond the standard mobile banners ads.

Diana Nguyen
Just Media, Inc.



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