Despite continued resistance from media and marketing elites, native advertising may prove too lucrative to ignore.
Take video recommendation startup Taboola, which plans to reveal some financial firsts on Wednesday. The startup is now pulling in revenues at an annual run rate of $100 million, and as such, is just beginning to turn a profit.
Taboola CEO Adam Singolda attributed the company's early success to its video-first strategy, a sound technological infrastructure, and close working relationships with publishers.
“We work hard to not be a black box on our publisher partner's sites,” Singolda said on Tuesday.
Embraced by the biggest and most distinguished media properties online, Taboola's clients include The Wall Street Journal, The New York Times, CNN, Bloomberg, Fox Television, Hearst, Gannett, USA Today, and The Hollywood Reporter.
More broadly, native ad spending surpassed $1.6 billion in 2012, according to eMarketer. Earlier this year, the research firm also predicted that the native niche would hit $2.85 billion by 2014.
Yet industry thought leaders have implored publishers and advertisers to rethink their relationships with native technology vendors like Taboola.
“Publishers should say ‘no,’ more than ‘yes’ to native,” Steve Rubel, EVP of global strategy and insights at Edelman, told attendees an the OMMA Native conference, earlier this month. “As an industry, we’re going way too fast.”
Asked who or what was most likely to derail the native ad train, Rubel fingered startups that allow for direct publishing of native advertising (like Taboola).
Viewing the world very differently, Singolda said that Taboola is “placing the user at the heart of what we do,” and pioneering a new age of content discovery.
In fact, Singolda said he sees consumers’ desire to discover fresh content -- and technology advancements -- as the real force behind native advertising.
“I think that in the following 10 years we have a real opportunity to build a new, multi-billion [model] in the advertising space, side by side to search, display and social … called discovery.”
“As a company … we have a long-term vision to build a search engine but in reverse, helping users discover content they may like and never knew about,” Singolda said.
By Singolda’s estimate, Taboola already serves 100 billion recommendations a month to 300 million consumers around the world.
Taboola also now claims to be the biggest native ad vendor, citing data from Compete.com showing the number of unique users that click on paid content.