• by Duncan Hall , June 30, 2015

As each generation becomes savvier and harder to reach, brands and advertisers have to think more creatively to reach their target audience, leading many to turn to native advertising.  

The biggest critique of native advertising is that it attempts to mask advertising within arguably credible and independent news sources. This erodes consumer trust of publishers and compromises their reputations as credible sources.

The biggest argument in support of native ad is that it is clearly labeled — consumers know it is produced by an external organization that paid for the spot. It means brands create more relevant and engaging content for consumers.

From a branding strategy point of view, it seems like a pretty good win. You get to tell your brand story in a much more effective way, compared to previous alternatives such as banner ads, and you get to access the readership of notable publishers.

Native ad: consumers vs. marketers

However, the merging of “church and state” is neither simple nor smart from a brand management point of view. Here’s why:

While publishers claim that paid content is clearly labeled, many consumers don’t see this. If you’ve seen John Oliver’s piece on native advertising, you’ll remember his statistic from the IAB saying that over half of consumers don’t know what they are reading is sponsored content.

Currently, the level of disclosure seems like an asterisk on a claim that you’ve won a million dollars.

Not only does this erode the credibility of the publisher but when the consumer finds out, it only reinforces their mistrust of brand advertising and strategy.

Native advertising seems like a quick win for marketers. But it is inherently that, quick. Just like consumers smartened up to the multitude of short-term marketing tricks, they will soon smarten up to this. 

In a 2012 study published in the Journal of Psychological Science, millennials were tagged as the least trusting generation. Millennials said that they would trust less than 19% of individuals, while 84% of them don’t trust advertising outright.

In addition, The McCarthy Group conducted a study on millennial trust and found the news/media industry was one of the least-trusted institutions, alongside government, religious institutions and corporations.

Short-term gains, long-term deception

With consumer trust at the lowest its ever been, particularly towards advertising, its strange brands still think the best way to reach the consumer is through deception. History has proven that consumers eventually get smart, but with an incredibly mistrusting and tech savvy generation, this lag time could potentially get shorter and shorter.

John Oliver is right, putting a tiny note on camouflage saying “this is not camouflage” does not mean you’re being honest.

Aside from being dishonest, there is also something incredibly ugly about sneaking into party no one really wants you at. All brands need to wise up to the long-term consequences of these short-term gains. Like in any relationship, trust is the most difficult to build. I don’t think brands should be risking their equity during this “trust recession”

Great native advertising examples

Instead of creeping into other people’s worlds, brands should work to create great content and bring consumers into your own world. This isn’t an entirely new concept, but there have been some really great advances in this sector.

Pineapple magazine from AirBnB and Function and Modernity from Bally are two really nice native ad examples of “indigenous advertising” that align with the brand story, but work r hard to create content that is relevant and engaging. Arguably less trendy as the former two, but equally thought through, PepsiPulse does a nice job at bringing together relevant content, social media and news into one central medium.

At the end of the day, many consumers probably don’t care much about who has created the content. But consumers do care about how brands try to deceive, influence or control them.

While there are seemingly a lot of positive benefits from the native advertising fad, the long-term risks could seriously diminish any and all brand credibility. It is imperative to be unambiguously honest about your presence, bias and vision. And if you don’t think people will like it, then you probably shouldn’t be saying a whole lot.