Commentary

What Are The Challenges For Native Mobile Programmatic?

Native ads that appear on publishers’ websites as branded or sponsored content are delivering higher engagement rates on smartphones and tablets than on desktop computers. That’s according to data from Polar and BI Intelligence.

And it’s an interesting finding, since the real estate on a mobile device is very small and the kind of sponsored content valued by premium publishers and their advertisers is multidimensional—and, one might surmise, harder to interact with and fully appreciate on a small screen.

The research found that click-through rates (CTR) for premium native ads were highest on smartphones, at 0.38% in 2015, while tablets saw an average CTR of 0.33%. Native ads on desktop computers saw CTR rates of 0.16%. 

Further, the average CTR rates for premium native ads on mobile devices were more than 4x higher than the average CTR of traditional, non-native display ads in the U.S. Traditional, non-native display ads—which includes banner, rich media or sponsorship ads that don’t have the look and feel of the adjacent editorial content—had an average CTR of 0.08% from September to December 2015, according to benchmark data from Google's DoubleClick. 

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With more advertisers relying on native advertising of all kinds, and mobile native appearing to deliver higher engagement vs. desktop native, what are the prospects for native mobile programmatic?

Writing in a blog post for the Native Advertising Institute, Robert Wildner, VP of media operations, glispa GmbH, outlines the issues that face native mobile programmatic advertising. Wildner says scale is a huge challenge and that premium, bespoke native campaigns frequently need to be served in a legacy way—not programmatically.

In-feed native ad campaigns are just the opposite—they can be served programmatically, and that’s already happening at scale, says Wildner.  He notes that bespoke native advertising can be a “time-consuming process which needs to be repeated for each platform.” Native advertising at scale needs to encompass all kinds of formats.  

For native mobile programmatic to really take off, the industry must come to some agreement on standards, which remain a “work in progress,” according to Wildner.  “The number of players in the mobile advertising market can be confusing, and the various different platforms, systems, publishers and advertisers has also led to difficulty in establishing standards due to a number of reasons,” he says. In addition, each publisher has its own definition for what native is, they often have their own ad formats and can’t agree on standards for native ad formats.

Another limiting factor he cites is Facebook and Google’s “walled gardens”—which, while providing great reach and targeting potential, limit the number of players that can gain access to the market.

Wildner notes that while the Interactive Advertising Bureau has released its Native Advertising Playbook, it’s unlikely that the market will experience significant enough changes this year to introduce native ad standards. He predicts that “native ad formats introduced by Facebook and Google will become the quasi-standard for native in-app ads." Why? Because they're dominant vis-avis app monetization on the supply side, and ad spend on the demand side.

Starting with in-app and in-feed standards is a positive step in the right direction. Any move for premium mobile native ad content to be delivered programmatically will need to start there. Wildner says in-app and in-feed native inventory are the easiest mobile native content to deliver programmatically.

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