One Quarter Of News Revenue Will Come From Native By 2018

As big a role as it plays now, native advertising looms even larger in the future of the news media, according to a new study by two global trade organizations, the International News Media Association and the Native Advertising Institute.

Based on a survey of 156 news media companies around the world -- most of them newspaper publishers -- the study projects that total news media revenues will rise from 11% in 2015 to 25% in 2018.

Looking at the current state of the business, 48% of newspaper publishers are currently offering some form of native advertising, while another 39% said they are likely to add it as an option for advertising clients in the near future, INMA and NAI found. Overall, 89% of respondents said they consider native ads important to the future of their business.

Delving into the mechanics behind native ad offerings, the survey found that 42% of news media companies use editorial staff, versus 33% who use their own in-house native ad studios, and 28% who have a separate native ad team. Finally, 26% use an external agency partner.

Publishers evidently have some contradictory feelings about these arrangements, however. For example, while 66% of respondents said they consider their companies’ editorial expertise to be a top recommendation for native ad skills, 38% are leery of the lack of separation between commercial and editorial operations.

Interestingly, native ads are still largely sold alongside regular display advertising, with 54% of respondents packaging them together. Meanwhile eight out of 10 respondents said they do not have a separate, dedicated sales team for native ads.

Of course, the reason for all this is not hard to find, as publishers can make more money on native ads than regular ads. In fact 65% of respondents said they charge more for native ads, although the margins are coming down somewhat from the early days of the business.

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