When Austrian skydiver Felix Baumgartner took a free fall from an altitude of 23 miles from above sea level in 2012, he broke the sound barrier with his body reaching a velocity of approximately 650 miles per hour. The event was co-sponsored by energy drink Red Bull and the video broadcast on Red Bull’s Youtube channel saw more than 8 million live streams.
That the energy drink is reinventing itself into a media house with a goldmine of exclusive content on extreme sports is well known. In the age of ad avoidance, it isn’t surprising that many brands look to produce exclusive content for the digital medium—often referred to as native advertising because this content doesn’t ham the product the way traditional advertising does. It speaks to the digital native in her native tongue. The videos and posts produced are both interesting and engaging and could be in the form of videos, blog posts and articles designed to resemble editorial content. Rebel non-traditional news companies such as Buzzfeed have managed to convert such content into a viable revenue stream.
Ad spending on native advertising globally is expected to reach $7.9 billion this year and grow to $21 billion in 2018, rising from $4.7 billion in 2013. GroupM’s This Year, Next Year report pegs digital ad spends at Rs 4,661 crore in year 2015, up from Rs 3,402 crore in 2014. Total ad spends in India are estimated at Rs 48,977 crore.
Globally, native advertising is on an upward curve galvanized by a series of separate events. Sir Martin Sorrell’s WPP, newspaper Daily Mail and Snapchat have announced the launch of an agency called Truffle Pig that will cash in on native advertising. As per the agency’s claim, it will comprise the “best of global agency, newsroom and social media talent”. An Israeli company such as PlayBuzz has seen $16 million in funding, and is testing a self-serve native advertising product that will allow brands to create their own PlayBuzz quizzes.
The New York Times is setting up a dedicated creative team for its paid posts in London called the T Brand Studio unit, and since last year, the US based paper has consistently been building up a team that focuses on ads that use content that mimic the editorial content produced by its journalists. Start-ups that deal in native are seeing a rush of funding—Nativo which brings scale to sponsored content on the web has raised $20 million in new venture capital funding. Google showed off a new native advertising technology that allows it to work with publishers to serve custom-built ads. The ads are native because they look different for each publisher to fit the look and feel of their digital properties.
Media publisher Times Internet which reaches over 150 million visitors and serves 2 billion page views every month across web and mobile, says native advertising is picking up in a big way, aided by mobile. In the backdrop of a digital conference held in Mumbai, Satyan Gajwani, chief executive officer of Times Internet said that native advertising should be looked at as solutions and not spots. The advertising needs to be smart and targeted. The benefit of native advertising is that it breaks clutter by being interesting, Gajwani asserts.
“Native advertising is changing the paradigm of what advertising is. Can I immerse myself in the consumer experience, in a way that is both contextual and relevant? We are talking about content that is genuinely useful to consumers, than content that is just disruptive. Native advertising combines the best of both qualitative and quantitative aspects of advertising,” says Gajwani. He added that as brands get better at making engaging content, finding good, relevant distribution will be critical. Native advertising is the best way to distribute.
For native advertising to be successful, the content has to appear interesting and relevant, and the brand has to be prepared to take a backseat. “Within the first two frames, you must catch the consumer’s attention,” says Satyaki Ghosh, director – consumer products division at L’Oreal India.
While there are many ways of going about native advertising, the best way is to be transparent, says KV Sridhar, chief creative officer at Sapient Nitro. “If you are a food blogger and I am a food based product—I don’t put banners on your blog. Instead, I make you post about food that syncs in with my product. This is an example of native advertising. In such a case, disclosures may not be made that it is paid content and if the truth comes out, the brand and the influencer lose credibility,” he said. A more appropriate way of doing native advertising would be as in Procter & Gamble’s #Like a girl initiative, remarks Sridhar. “The content is more about instilling confidence in women, than just about selling women centric products. You need to be selfless, in order to be selfish,” he says.
A digital company such as Quartz produces native or paid content, but with appropriate disclosures, points out media consultant Paritosh Joshi. The quality of such content is at par with the editorial quality of its news pieces. “A lot of the embarrassment around native advertising in India is because of a history of badly produced branded content,” says Joshi.
Agrees Sridhar who believes that such content needs to be handled very carefully. “There has to be a context and a fit for native advertising. For instance, an electric car can put out a lot of content around environment related issues,” he says.
Brands as creators and curators
A lot of brands have used native successfully. Nike sent seven of the American National Football League (NFL) players to their respective high schools in order to crash practice and share advice. The content featured six videos, with short textual commentary and was done in association with an online sports media brand called SB Nation.
Another interesting example is that of The New York Times and Netflix where they teamed up for an engaging native ad about women in America’s prison system. The interactive page featured videos, statistics and narratives, written in a raw and journalistic style and fit in well contextually with Netflix’s original series Orange is the new black.
Times Internet’s Gajwani points out that brands such as Pepsi, Lay’s, Philips, Ponds Men, Amazon, Maruti Suzuki, HSBC, HDFC, Franklin Templeton, etc., have been doing a lot of work in native advertising. There are also international brands such as Wells Fargo, Transfast, Hong Kong Baptist University and Sling in the race. Gajwani says that unlike banners which can be anywhere, native ads perform best when they are in the context of premium immersive content. “As users start avoiding display ads on the web, native ads are the new way of engaging with consumers,” he said.
Native advertising is yet to catch up in India because television is still showing significant growth. “But certain segments of younger, tech savvy people who have access to new technologies will need to be reached via embedded content,” says Joshi.
And that is what’s getting marketers to explore that area. “We are doing a lot of native for both Maybelline and Garnier. L’Oreal hosts a lot of make-up and styling tutorials for Maybelline. Similarly, we have interesting videos for Garnier with plots. With Garnier lip balm, we realised that men are put off, because putting on lip balm involves a lipstick-like gesture. So we did a video about a couple. People watched it because it was an interesting and largely unbranded video. You learn of the brand only at the end.” says L’Oreal’s Ghosh. He added that such advertising is clearly beneficial to platforms such as Facebook or Instagram, because people tend to spend more time there. “But for advertisers also, such content is advantageous because you can put up a short write-up, alongside the video.”
Native advertising’s ability to fill up the gap was realised almost ten years ago. Media explosion, simmering fragmentation and increasing costs has found brands vying for attention. A company such as Maruti is continuously engaging Indians with relevant content and blended conversations in native. Another digitally sophisticated umbrella brand is Madura Garments which has done native messaging for many of its sub-brands.Fast moving consumer goods company Unilever has also been gradually extending its focus from intensely traditional advertising to native advertising. Converging native embedding with highly relevant content has led to an impactful platform, such as All Things Hair to showcase how HUL’s innovative products solve every day hair problems.
Milind Pathak, chief operating officer of Madhouse India, WPP’s mobile marketing and communications company says real estate, banking, finance and insurance and equipment manufacturers are the leading players who are using this format in its true sense. Some use native for guerrilla marketing and others for a deeper connect.
Bharti AXA Life Insurance has launched into a digital campaign called “Fresh Perspectives” where four videos have been launched with narratives from real life people, around the themes of protection and good living. For instance, the real life story of a banker known as Gurmeet Kochhar who quit his job to become a “dabba-walla” in Mumbai. He had the realisation that there was a genuine need in the metropolis for good hygienic home –cooked food and today runs a successful enterprise catering to busy office-goers. Jitin Paul, chief marketing officer, Bharti AXA Life Insurance said that the campaign has had over 1.7 million plus views on Facebook and Youtube and has been shared 5500 times. “Digital is today the most effective means of engaging on the media interface. The internet that started initially as an information powerhouse has captured the imagination of everyone across the globe and brought about a revolution, in the way we communicate, engage and transact,” said Paul. Unlike competition, which was category focused and were using the digital medium purely to communicate about products and services and to activate contests, Bharti AXA was focused on keeping the consumer at the centre of content creation and produce stories that were share worthy, he added.
E-commerce companies, Pathak says, have the potential to drive differentiation especially when one shoe is trying to fit itself in all sizes. “A company that is around apparel can make use of native content, not only in the context of words but also of images of celebrities and latest fashion trends. Many apps will talk about photo based moment targeting as we move into the future,” he says.
Wiring it right
While there is a lot of branded content available in the digital space, only a few hit the mark. Johnny Stark, senior vice president, Asia Pacific – head of brand and real time marketing at Razorfish, in his visit to India earlier had pointed out some compelling content done by Farm State Nation, an American insurance company, which produces a lot of content on how insurance can make people’s lives easier. In Stark’s view, there are a lot of problems when brands transform into publishers. “You see brands rushing off, trying to desperately publish realms and realms of content, but the problem is they are always going to publish brand content. It is always about telling a story about the product. But you need to engage consumers with content that interests them, or is relevant to their lives.”
Who then is best equipped to deal with such content? A more collaborative approach may be required between media owners, media agencies and brands to make native advertising work most effectively. Times Internet’s Gajwani says that while some brands incubate content—especially for social media in-house and use that in native advertising, others are in touch with creative studios for the execution of such content.
Ranjoy Dey, head of digital at Havas Media India says that a whole new ecosystem is being formed in order to deliver on such content. There are new companies and specialised distribution platforms being spawned. Dey says that native advertising would undoubtedly boost revenues for publishers. While a lot of digital inventory is now traded by automated tools and trading desks, publishers’ sales teams should now include deals that include highly engaging, new native formats. These require a more consultative sales approach, he says.
“The brand story must be conceived by the brand team internally,” says Dey, “And then the brand and the agency need to work together to create specialised content suited to various formats and placements. The agency should also be able to bring in specialised resources as and when necessary to develop critical pieces,” he said.
To be sure, native advertising created by publishers may face challenges of cost and scale for buyers. This is where the role of brands come in. Brands need to support native advertising with tracking and data. It’s only when publishers, agencies and brands work in tandem that native advertising gets the attention and trust of the customer.