New Research Commissioned by Purch Reveals Prevailing Trends and Obstacles to Native Advertising and Programmatic Buying
NEW YORK, NY (June 10, 2014) – Purch, the leading content and commerce company for connecting buyers and sellers of technology and SMB products and services, today announced the results of a new commissioned study conducted by Advertiser Perceptions, the leader in research-based advertiser insight for the media industry. The study examined native advertising and programmatic buying, two of the top trends in the advertising and marketing industry, defining their growth and identifying specific objectives and challenges for each.
Native advertising and content marketing are beginning to garner budgets rivaling standard digital display. Per the study, native/sponsored content advertising spending is growing fast and expected to triple from 2013 to 2015. Programmatic buying is already nearly ubiquitous with 78 percent of high-level decision makers confirming their use of programmatic across campaigns.
The common element driving the growth of both native and programmatic is advertisers’ desire for the combination of branding (awareness) and performance (sales and conversions). The study indicates that most native/sponsored content advertisers have branding as a main objective (71 percent), with a large majority (65 percent) citing sales/conversions as a top priority. Programmatic campaigns are typically assessed through performance metrics, including sales/conversion rates (75 percent). Yet a majority of programmatic advertisers include brand lift among their top evaluation metrics (51 percent).
“Advertisers’ desire to create brand lift, while also driving sales, has cemented the use of both native and programmatic for publishers and marketers alike,” said Mike Kisseberth, CRO, Purch. “The take-away for digital content providers is that to stay ahead of the curve, you must find ways to customize and innovate on both of these offerings to achieve, and exceed, the branding and performance metrics put forth by advertisers.”
Additional key findings include:
• Most prefer native programs that live directly in the hosting site’s content well. According to Purch’s findings, 47 percent are extremely likely to execute in-feed sponsored content that is consumed in an editorial-like environment on the hosting site. Only 28 percent are extremely likely to use in-feed campaigns that link to an off-site landing page.
• Though native spend is projected to triple by 2015, critical obstacles remain. Insufficient reporting and ROI metrics (46 percent) are the biggest challenge to success, followed by misalignment between the campaign and marketing objectives (38%), required time and resource commitment (26 percent), and native programs being insufficiently turnkey (24%).
• Advertisers have come to anticipate and expect an exceeding fast pace of change in the industry. Even though native advertising programs are very rarely available through programmatic platforms, 42 percent of advertisers expect to purchase them that way within the next six months, and 79 percent of advertisers expect to purchase them that way within 12 months.
• Advertisers prefer to deal with publishers directly for programmatic campaigns. A majority of those surveyed have used agency trading desks (65 percent) and demand side platforms (61 percent) to purchase programmatic. The preferred programmatic provider, however, is publishers (36 percent), following by trading desks (23 percent), and DSPs (21 percent).
• Agencies and marketers find different benefits in programmatic. Agencies are more attracted to increased efficiencies in buying premium inventory than marketers (46 percent versus 36 percent), while marketers are more attracted to reaching targets without waste (45 percent versus 24 percent).
• Important criteria when selecting a premium programmatic partner include: audience insight and data (91 percent), ease of use (90 percent), credible metrics (87 percent), audience quality (87 percent), transparency (87 percent), inventory guarantees (87 percent) and access to first-party data (81 percent).
• The obstacles to increased use of premium programmatic (preferred or private auction deals negotiated with a publisher) include lack of premium inventory (54 percent) and inadequate targeting to preferred editorial brands and audiences (37 percent).
The study was conducted in Q1 2014 among high level U.S. marketer and agency advertising decision makers, spending $1 million or more on digital advertising. The survey focused on their current use and future plans for native/sponsored content and programmatic digital advertising campaigns.