\ guide The Comprehensive Guide to Native

The Comprehensive Guide to A Vocus

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The Comprehensive Guide to Native Advertising A Vocus eBook

Native advertising – the purchasing of sponsored content on social networks and online websites – dominated digital conversations the past year. company BIA/Kelsey estimates that U.S. native ad spending on social sites might have reached $2.36 billion in 2013, or 38.9 percent of total U.S. paid social ad expenditures.

How can you effectively work native advertising into your marketing mix? This eBook highlights some techniques are using to do just that. It will show you the rich native advertising ecosystem of publishers, vendors, social networks and search engines that help companies create, manage and track content.

Finally, we’ll show you the ethical issues to avoid with sponsored content. The Federal Trade Commission (FTC) recently held a meeting with brands and publishers to discuss native advertising – and while some issues were highlighted, others were raised. Your can use this set of tools, as long as the ads disclose sponsorship so that consumers are better informed.

iPad 10:15AM The Comprehensive Guide to Native Advertising

What is Native Advertising? In The New York Times example below, the post is clearly labeled as “Paid For and Posted by Dell.” A survey from Online Publishers Asso- ciation says native ads include “con-

iPad 10:15AM tent integrated into the design of the publishers site, living in the same domain, as well as content either provided by, produced in conjunction with or created on behalf of our advertisers that runs within the editorial stream.” In native ads, there is a clear delinea- tion, labeling the unit as ad content.

The Bureau defines six types of native ad units in its must- read, “Native Advertising Playbook”: And integrates their native advertising in the OO in-feed units (such as ’s ads form of posts written by the brand, which is delineated as a with a social context) “BuzzFeed Partner.” OOPaid search OORecommendation widgets (often seen as “From Around the Web”) OOPromoted listings OOStandard ads with native elements (banner or box with text or placed at beginning of post) OOCustom campaigns created with the client

This graphic shows an “in-feed” example, from Forbes’ homepage. It looks like other articles, but is clearly called out as a “Forbes BrandVoice.” The disclosure indicates spon- sored content, in this case by Gyro, a B2B marketing firm.

Edelman Public Relations’ Chief Content Strategist Steve Rubel sums it up succinctly: “I’d define native advertis- ing as taking that which is organic and flipping it around into advertising.1”

Native ads aren’t unique to online publications like Forbes or Mashable. Facebook’s ads (and, for now, their “sponsored stories”2) and ’s “Promoted Tweets” are examples of sponsored content appearing in social networks. Unlike the Facebook banner ads, content ads such as photo posts

1 Conversation with Steve Rubel, 1/2/14 2 Sponsored Stories will “sunset” on April 9th of 2014, http://allfacebook.com/sponsored-stories-sunset-april-9_b128224 The Comprehensive Guide to Native Advertising

are paid promotions of actions that a user’s friends take on While debate on vs. advertising the platform, including check-ins, “likes” or RSVPs. They can go on all day, the form is considered native appear directly in the News Feed. Page owners can target advertising, implying a payoff for the marketer as well as ads via Facebook’s ad manager. the consumer.

A brand may have their own account on Twitter, How Does Native Advertising Fit but much of their content is not seen because most people are not on Twitter at any given Into the Marketing Mix? moment. A Promoted Tweet shows up Many brands struggle with how native ads should fit within in the stream for users who follow that their larger marketing strategy. Native ads straddle several account or are targeted based on the user’s tactics, including social engagement, owned media, and expressed interests, geography or device. of course, paid advertising. But how does it help a brand The Promoted Tweet is noted as “promot- achieve its objectives? ed,” but appears natural within the user’s stream, “integrated into the design” of the site. “When we think about the , amplification and ultimately, the engagement with content – that’s where Edelman PR’s Rubel says, “If you look at search content with we think about our client’s goals,” says Edel- paid search results, that’s the model. If you look at Tweets man Digital’s Executive VP of Emerging and Promoted Tweets, that’s the model. And it’s working.” Media and Technology Adam Hirsch. Hirsch notes ways in which native Content Marketing vs. Native Advertising advertising can assist a marketer at the top of their funnel with Currently, many firms are using “content marketing” to acquisition and brand aware- reach customers. Native advertising has a lot in common ness, as well as ways to generate with content marketing; however, content marketing is leads and conversions. typically text, video or other media that is intended to inform the customer, providing something of . Brand building and awareness are at the top of the traditional Much of content marketing builds brand over time. This funnel. Creating articles that run paper itself is an example of content marketing - a neutral in relevant publications can help make point-of-view piece of content that is not selling a customers aware of your products, services and specific service or product, but educates marketers as a offerings. Publishing content in a Forbes, The New York service from Vocus. Times, or BuzzFeed environment delivers lots of attention and possibly perception change or consideration regarding Alternately, native advertising is material that is spon- products or offerings. sored. While it may offer valuable content, it is still an ad trying to offer a product, service or point of view. Often Sponsored content can generate conversions and create times, native advertising is used to expand the reach of leads. For example, social media in-stream ads can have content marketing – to get more eyes on the content similar targeting ability to email and marketing automa- produced by a brand. tion, according to Hirsch.

Forbes Chief Product Officer Lewis DVorkin reminds us “Facebook amplification has been pretty great for us that what we consider “content” is often marketing in because you can optimize for engagement or conversions disguise. The Michelin Guide for travel and accommo- that you can track,” says Hirsch. “[Facebook offers] content dations was started to encourage travel (and inevitable that you’re able to amplify in a segmented and personalized tire replacement). The Comprehensive Guide to Native Advertising

way. Through first-party targeting with their custom‘ audi- “In ‘old school lead’ generation, depending on industry and ences’3 product, through third party use of pixels or retar- company, the cost of leads can range from a few dollars geting, Facebook is providing the ability to target users on to thousands of dollars,” says Hirsch. “With hyper-targeted exclusive social segmentation sets based on what they’re networks, psychographic targeting and retargeting, you can talking about or what their interests are.” bring your cost-per-lead down significantly.” Measuring results and seeing what types of content resonate on which Native ads can also help your brand with bottom of the funnel networks and platforms is an absolute must in native adver- activity by converting existing and new customers. For tising, as “best practices” are not yet established. example, a brand can create sponsored content ads directed specifically at Facebook users who are already customers. The Ecosystem of Native Adver- You can also target via “look-alike” audiences who share characteristics with your existing fans and customers. tising Providers

The native ad ecosystem includes content creators, such as The level of targeting is so sophisticated that, in Hirsch’s companies, brands and agencies, who create the content words, “You have an opportunity to share an article about either alone or in conjunction with the publishers, as well as your brand only to journalists who work at The New York the search and social networks and vendors offering adver- Times and Wall Street Journal or whatever stakeholder tising space. This diagram shows how they work together. audience you’re targeting.”

Facebook also allows retargeting via its Exchange product.

If someone has come to your website to view a prod- Content Platforms uct or service, you can retarget them so that when they Content Recommen- return to Facebook they receive an offer or message in the Publishers Content Distribution dation, Outbrain, Forbes, Mashable, BuzzFeed etc. Sharethrough, Taboola, AddThis and native News Feed stream. Many Facebook targeting func- Nativo, others many others tions are offered in the updated advertising manager inter- Native ads "In-Feed" Articles, Videos, Boxes under/near placed in-feed on content.Titles like face, but some require working with third party Facebook publishers' sites "Content From around the Web" Exchange partners.

Twitter has similar offerings. The company announced Social Networks Facebook,Twitter, Search LinkedIn, , targeting based on interests in 2012 and recently launched Google, Bing, Yahoo, Content Creators YouTube, etc. the ability to retarget users, and is expected to offer a custom others Brands themselves Agencies Content showing Sponsored Search Publisher studios (like Huff inside the user's audience product similar to Facebook’s. For example, Twitter results next to Post Partner Studio) main feed (FB Spon- organic results empowers restaurants to automatically suggest themselves sored stories Twitter Promoted Tweets) to someone who is searching for dining recommendations.

How much should you be spending on native advertising? According to Edelman Digital’s Hirsch, it’s important to allocate a reasonable budget to test out and get the most Publishers impact out of native advertising. Publishers are considered the media sites that create online “When it comes to content amplification, start with a content, with regular publication schedules and sizeable $5,000-per-month budget minimum, no matter what size audiences. Web properties such as The New York Times, company you are,” says Hirsch. “You need enough money Forbes, The Huffington Post, BuzzFeed and Mashable all in the budget to start testing what’s working. So every have different ways of presenting and promoting native ad month, optimize between networks, test on the networks content to their audiences. The New York Times states that themselves, and see what’s working to figure out your native ads will have a color bar and the words “Paid Post” optimal media mix. prominently displayed.

3 See Vocus FB Guide for how to create custom audiences. The Comprehensive Guide to Native Advertising

Forbes shows native ads under the branding “BrandVoice” can get a lot of value. Some of them even have “studios” that and the units can be seen on the lower portion of its home- will help you create content without the six-figure budget. page. Forbes BrandVoice partners use the masthead’s tools to publish content. Their headlines and their posts – the Content Platforms native ad content – flow though the content management system onto Forbes.com. Vendors are developing products to help brands place their content adjacent to high quality editorials. An Altimeter In anticipation of December 2013’s FTC hearing on Group report on the native advertising landscape lists more native advertising, Forbes published specific statistics on than 40 vendors, including Outbrain, Taboola, AddThis, its BrandVoice platform. DVorkin states, “1,100 total Brand- and Sharethrough. Voice posts generated 821,000 social shares. Those actions resulted in 565,000 social referrals to content [on the Forbes There are two main types of content platforms – content site]. Search referrals generated an additional 1.1 million distribution and recommendation, and native feed insertion. visits.” Partners had as many as 13,500 views per post, with up to 120,000 monthly unique visitors to the content Content distribution and recommendation platforms tend published on Forbes’ site. to show their content next to or below the main page con- tent. They typically serve a widget that offers related con- How much does a native ad campaign cost? According to tent from within the site, as well as “From Around the Web.” a Digiday report from June 2013, campaigns can Users are targeted via cookies and other mechanisms, and range from as little as $5,000 for a post on the content is personalized based on previous clicks and the Business Insider to as much as $100,000 context of the current page. Marketers bid on a cost-per- for five posts on BuzzFeed. For example, click basis and can analyze their traffic to optimize results. The Huffington Post charges $40,000 for an article, but promotes it on their Vendor Format Business Model site for four days. Such a would yield approximately 20 million Outbrain “Additional Recom- Websites are paid impressions. However, it is not known mended Content” for referring traffic how many audience members click widgets on sites like outbound. through and read the content, nor what CNN, Time, and actions they take. Rolling Stone. Marketers pay on a cost-per-click basis,

If publishing prices for top websites alarm you, there are Personalized via with a $10 mini- alternatives. “Consider working with ‘mid-shelf sites,’ with individual’s brows- mum daily budget. publishers who are experimenting,” says Edelman PR’s Steve ing habits. Rubel. “There are sites in the ‘mid-tail,’ below the ComScore 1000, and you can experiment in everything from newslet- Real-time analytics. ters to event co-branding. Taboola “Content You May Websites generate “Webinars have a similar business model,” says Rubel. “If Like” widgets on revenue by hosting you’re looking to experiment on big sites with a lower bud- USA Today, TMZ sponsored content. get, pick your spots with publishers that will drive some sort and more. Video of meaningful brand-building within that platform. If you and text. Cost-per-click know that a BuzzFeed or Mashable is not going to cover you model, plus more at length, you could use budget to create a one-time boost Targets users with platform within that particular site.” content, uses A/B with dedicated sales testing to improve team. B2B and trade magazine sites are experimenting and you ROI. The Comprehensive Guide to Native Advertising

Native-feed insertion companies like Nativo and Share- on the Web for the bottom half of the funnel, but there aren’t through let marketers place content right in the organic great mechanisms for the top of the funnel, both in terms of areas of the website, in the feed or on the main page of creative that has impact and that’s scalable, and also is mea- a site. surable.” Nativo offers the ability to drop a retargeting pixel, so companies can use their existing bottom-funnel mech- Self-service ads No minimum for Share- anisms. Both vendors note that direct response can work show “in-feed” on self-service, CPM through if the content shared has a specific response call-to-action. mobile. Full service basis. model guarantees impressions, on Full service is a Search and Social desktop and mobile. minimum $20,000 In addition to the platforms that help brands put their mes- spend. sages adjacent to or within the context of a publishing site, Targeting via DMA search engines and social networking sites provide a way and Zip Geographic, to put brand content in the main context of the user expe- behavioral/lifestyle, rience. Most web users are already familiar with the spon- and contextual in sored search results that appear on the top and right sides verticals like busi- of Google, Bing and Yahoo! search results pages. This is ness or entertain- probably one of the earliest and most ubiquitous examples ment. of native ads, as it appears “integrated into the design of the publishers site.” Nativo Self-service model. Works with limited Targeting includes number of premium Social networks have followed suit. From Facebook, Insta- geography and brands, primarily gram and Twitter to LinkedIn, most of the major social net- device, control over through agencies. works have figured out a way to offer content from advertisers placement, real time where users previously expected content from friends. monitoring of time Cost-per-thousand spent with content. buying, with a min- imum spend around Platform How It Works Cost Model Placement into $20K. Includes en- and Con- many major pubs, gagement analytics. tent Unit on desktop, mobile Facebook • Page owner Self-service via ad and within mobile Text, images, slide- ads with promotes a fan’s manager. apps. shows and video a social actions taken on a content. context page to amplify with (formerly the action-taker’s “sponsored friends. These networks put content right into partners’ site feeds. stories”) • Works with likes, Sharethrough’s Tom Channick, senior communications check-ins, use of a manager, claims this is the most effective way to reach game, RSVP’ing to people, especially on mobile. He suggests testing targeting an event, or posting with different pieces of content, and monitoring results on page. to see what content works. The Sharethrough team has to • Extensive target- approve all content, since Channick says the company ing. doesn’t want their distribution platform to be sharing “belly fat” and “lower mortgage” ads.

Nativo President Justin Choi says, “Native [ads] typically focus on the top of the funnel. There are great mechanisms The Comprehensive Guide to Native Advertising

Platform How It Works Cost Model on Twitter and start promoting your Tweets if you have and Con- no followers. Sponsored stories can help grow a brand’s tent Unit likes and followers, but only when the content resonates • Shows as a spon- Initially working with users. sored picture within only with brands the native stream. that have exten- A sponsored story promoting a post that has little organic sive followings. traction will probably do poorly. Promoting content that See Burberry and is already being shared to a wider audience is a recipe Michael Kors as for success.4 examples. Content is Still King Twitter • Regular tweets, Self-service via ad management Promoted boosted to the top of Native advertising requires quality content. interface. Tweets stream, marked as Studies show that if sponsored con- promoted. tent delivers context, people gladly • Recommended embrace it as something worth- follows. while and useful. Furthermore, iPad 10:15AM • Targeted via inter- publications hold sponsored est, gender, geog- content to strict editorial stan- raphy, by device, dards. Not every message can and via audience be a textual article featured on similarity to existing Forbes or Mashable, and creat- followers. ing content for both properties can cost a significant amount. LinkedIn • Promotes content Via ad manager. At the same time, creating singular Sponsored shared via a Cadillac pieces also exposes companies Updates and con- company page to to risk of must-succeed situations. tent ads a wider audience, extensive targeting “Instead of creating one gigantic piece of content, try several; capabilities. use a PR post, link an article, post a Vine video, run them through the platform and see what works,” says Share- Rubel states, “For the social networks and search, this is their through’s Channick. entire business model. It’s no longer display. Their model is effectively to integrate – to take the organic structure and The media type also greatly affects how it is presented. flip it around to an ad.” “[Producers] put a can of Diet Coke on ‘American Idol’ and no one complains,” says Rubel. “Or a radio DJ gives away tickets “LinkedIn is a huge opportunity, especially for specific types to a concert and plugs it, no one complains. The closer you of companies or specific types of messages from those com- are to entertainment-based or lifestyle content, the more panies, whether it’s for a B2B or B2C audience,” says Hirsch. the lines get blurry and the deeper the topic can be inte- “There are a lot of key audiences you can target directly from grated, provided it’s not a product review type of post.” LinkedIn for content amplification from company pages. Its usage is dramatically increasing across Edelman, with the “I think that’s giving BuzzFeed the ability to really do that in product out only for the last three months or so. It’s a new earnest because a lot of the ways they integrate brands is ‘owned’ media channel for content amplification.” through lifestyle content,” says Rubel. “Native ads get most disruptive the closer they are to being straight up advertorial Anyone can create ads on social networks, but smart brands in nature, and interruptive as opposed to additive. The leverage their existing presence. For example, don’t jump efficacy of that remains to be seen.”

4 http://images.prsoftware.vocus.com/Web/Vocus/%7Bca91784d-8997-494c-8237-8e77fad39d39%7D_Vocus_-_New_Facebook_Guide.pdf The Comprehensive Guide to Native Advertising

Creating great amounts of content often isn’t “native” to challenging to know how much they need to disclose, and midsized companies or smaller brands. They may be used for consumers to understand how much an advertiser has to creating brochures, posting posts or even sharing played a role in presenting content to them.” content on networks. But some of these new formats, along with the corresponding content types and targeting, will Some publications clearly denote content is sponsored. be unfamiliar. Other sites are less forthcoming. Another challenge, claims Chernaik, is that people use different words to describe Rebecca Lieb notes in the Altimeter Group report5 that the ad units, such as “sponsored” or “promoted” when they education and training will be required. Marketers need to really mean “advertisement.” “The industry needs to step up, apply skillsets like strategy, content, media buying and a or a regulator needs to say ‘This is what we expect,’ and it’s social component. For companies that don’t have the staff often better if the industry steps up,” adds Chernaik. to handle or who wish to outsource it, publishers like The Huffington Post provide “studios” to Consider Forbes’ “BrandVoice,” which create content on behalf of advertisers. The company has is marked at the top of articles and staff separate from the journalists and video creators who has a disclosure link that states, work with brands and agencies. “Forbes BrandVoice™ allows marketers to connect directly “The native advertising space relies on catchy headlines, and with the Forbes audience by it’s important [to] write content that people really want to enabling them to create con- access,” says Tom Chernaik, CEO of CMP.LY, a monitoring, tent – and participate in the measurement and insight tool company. Chernaik is also conversation – on the Forbes co-chair of the Member’s Ethics Advisory Panel at the Word digital publishing platform.” of Mouth Marketing Association. “What’s driving all of this Will the FTC accept the phrasing is that content gets shared by people. You want to make “Connecting marketers to the sure that it’s clear where the content comes from.” Forbes audience” instead of “spon- sored content?” It remains to be seen. Adding a social dimension of amplification to the content that’s being shared natively is another point made by Lieb, The previously mentioned “IAB Native Advertising Play- Rubel and Hirsch. Having content seen once is a benefit. book” takes some of the first steps towards industry self-reg- Having it shared many times can reduce your overall cost ulation by publishing disclosure principles, which state that of customer acquisition. “The disclosure must use language that conveys that the advertising has been paid for.” The FTC also states advertise- Disclosure and Challenges ments “must be large and visible enough for the consumer to notice it in the context of a given page and/or relative to the “Consumers, overall, are responding very well to native device the ad is being viewed on.” ads, and that’s why it’s such an appealing area for advertisers,” says Chernaik. However, the FTC Consumers should be able to distinguish between paid is asking questions to protect consumers. advertising and editorial content. The problems can extend to content when it leaves the publisher’s site. The commission held a meeting in Washington, D.C. last December to Chernaik noted that if something is showing on a page, explore these issues. “How clear do you there may be disclosures, but in a feed or on someone’s need to make it, and when do you need timeline, it may not be clear to consumers, which is where to make it clear that something is actu- the FTC may step in. He warns, “People are focusing on it as ally sponsored content?” asks Chernaik. an ad , and you get tripped up when you look at it “Since there’s no standard way to disclose as ads. The component that makes it so compelling isn’t the it, or to present the information, it becomes ad component, it’s the word-of-mouth component. That

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wasn’t addressed in the FTC workshop. It’s the buzz that Services like Outbrain, AddThis and others offer self-service builds around the content that drives native advertising, not ways to promote content in the context of large publisher’s the content presentation.” sites without having to directly deal with the publishers and their budget minimums. Bid-based marketplaces encour- The FTC has not taken formal action yet, but since age experimentation and give marketers a chance to hone they’ve previously issued guidance on making their messages and content types while controlling spend. blog and celebrity endorsements more clear, These services can help make an already popular post more it is reasonable to think they will monitor the widely shareable. Nativo, Sharethrough and others put native ad ecosystem with similar vigilance. brand content right into the feed on multiple publishers’ sites, with targeting and analytics to measure the results. “The real question,” says Edelman’s Rubel, “is ‘What does the reader want?’ I know what the Using analytics and setting key performance indicators technology vendors, publishers, and advertisers (KPIs) will help you evaluate all the offerings discussed. want from native advertising. I don’t necessarily know what the audience wants from this yet.” As a marketer, it will be more important than ever to test multiple content formats. Will native advertising result in Research shows the efficacy of native ads. According to the promised payoff of higher engagement and interaction a study by Interpublic Group’s IPG Media Lab and Share- – as much as 39 percent higher in some cases? Only your through, consumers looked at sponsored content 52 per- own tests, metrics and KPIs will answer that question. cent more frequently than banner ads. Native ads generated 9 percent higher brand affinity lift and 18 percent higher One thing is for sure – 2014 is definitely the year to try purchase intent response than banners. native advertising.

Conclusion About Vocus

Consider how you can apply native ads to your larger Marketing can be hard. To help you succeed and generate marketing stream. Ask the right questions: Will they help more revenue, Vocus offers an integrated suite of the most convert sales? Or will you use them to amplify and build powerful tools you need. social brand and content marketing activities?

We help you attract and engage prospects on social media, Once you decide, consider your options from the increas- search engines and in the news. We get your message in ingly rich world of native advertising providers. Search front of the right prospects at the right time with tools, cus- and social networks may be the easiest entry points into tomized landing pages and targeted emails. sponsored content for brands. Many of these choices, from Facebook’s ads and Twitter’s Promoted Tweets to Linke- Our suite includes a social CRM to manage the activity of dIn’s Sponsored Updates are self-service offerings. These your prospects and customers, and integrated analytics to social networks offer guides and case studies that explain discover what drives likes, shares, opens, click-throughs best practices and walk marketers through the steps needed and conversions. to execute a campaign. Native units are most helpful to brands that already have a presence on the networks and With our marketing consulting and services team ready to who know how their users respond to content. help, Vocus delivers marketing success.

Working with publishers can be a potentially expensive Find out more at www.vocus.com. endeavor unless you find a site that’s willing to work with a smaller brand. Look for more midrange sites to offer spon- Connect with us: sored content opportunities to attract first-time buyers. Most publications have or are planning an offering on their digital site.