The Key Ingredients of a Native Advertising Product

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Updated for the Atlanta Native Advertising Summit.

Building a native ad product requires much more than simply slapping a sponsored tag on content. It takes connecting deeply with your users to understand the role your product plays in their life, and translating that promise into a branded experience that will merge with their expectations. Jack will discuss the steps needed to better connect your user experience with branded partners.

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The Key Ingredients of a Native Advertising Product

  1. 1. The Key Ingredients of a Native Ad Product Jack Krawczyk ! @jackk! ! June 27, 2013!
  2. 2. Combining the Ingredients 1 2 3 Fragmentation of the Media Experience! Pressure on the Core Economics! Revenue: The Lagging Indicator!
  3. 3. Advertising Used to be Pretty Easy
  4. 4. 1985 34% 19 reach among US households! average # of channels per home!
  5. 5. 1995 21% 41 reach among US households! average # of channels per home!
  6. 6. 2011 13% 135 reach among US households! average # of channels per home!
  7. 7. Audiences are Fragmenting
  8. 8. 0 200 400 600 800 1000 1200 1400 1600 0 5 10 15 20 25 30 35 40 1970–1971 1971–1972 1972–1973 1973–1974 1974–1975 1975–1976 1976–1977 1977–1978 1978–1979 1979–1980 1980–1981 1981–1982 1982–1983 1983–1984 1984–1985 1985–1986 1986–1987 1987–1988 1988–1989 1989–1990 1990–1991 1991–1992 1992–1993 1993–1994 1994–1995 1995–1996 1996–1997 1997–1998 1998–1999 1999–2000 2000–2001 2001–2002 2002–2003 2003–2004 2004–2005 2005–2006 2006–2007 2007–2008 2008–2009 2009–2010 2010–2011 2011–2012 #ofcommercialTVstations %reach Reach of #1 TV Show in US vs Total # of TV Stations % reach # of commercial TV stations Source: Nielsen, TVB
  9. 9. Combining Your Ingredients 1 2 3 Fragmentation of the Media Experience! Pressure on the Core Economics! Revenue: The Lagging Indicator!
  10. 10. Fragmenting audiences make advertising much more expensive.
  11. 11. The Economics Say So Content! Producer! Studio! Network! Brand! Audience!
  12. 12. Content! Producer! Studio! Network! Brand! Audience! With more channels, the cost of acquiring audiences increases.
  13. 13. Content! Producer! Studio! Network! Brand! Audience!Higher audience acquisition cost puts pricing pressure on content.
  14. 14. Content! Producer! Studio! Network! Brand! Audience! GRP rates increase to offset audience & content costs.
  15. 15. Content! Producer! Studio! Network! Brand! Audience!Audience fragmentation leaves content producers earning less… …and brands paying more to reach their target audience.
  16. 16. So Brands are Investing in Building Their Own Audiences
  17. 17. Content! Producer! Studio! Audience! Brand! Network!
  18. 18. Content! Producer! Studio! Audience! Brand!
  19. 19. 18
  20. 20. 19
  21. 21. 20
  22. 22. These brand-produced assets are becoming increasingly portable.
  23. 23. Content! Producer! Studio! Audience! Brand!
  24. 24. Content! Producer! Studio! Audience! Brand! Digital Properties!
  25. 25. It’s the same content. Just repurposed for its native consumption.
  26. 26. Pandora -> Audio [stations] Twitter -> Tweets Facebook -> Posts Pinterest -> Pins YouTube -> Videos [channels]
  27. 27. Content! Producer! Studio! Audience! Brand! Digital Properties! This is where native advertising lives.
  28. 28. Combining Your Ingredients 1 2 3 Fragmentation of the Media Experience! Pressure on the Core Economics! Revenue: The Lagging Indicator!
  29. 29. Good User Experiences are Good Brand Experiences
  30. 30. Longer Session Length
 
 =
 
 Happy User!
  31. 31. Longer Session Length
 
 =
 
 Longer Brand Engagement!
  32. 32. Transitive Property of Native Advertising…
  33. 33. Happy User
 
 =
 
 Longer Brand Engagement!
  34. 34. Hold Native Ad Products to the Same Standards as Core Products
  35. 35. What is the main user behavior on your service?
  36. 36. <- Branded Radio
  37. 37. What are the main drivers analyzed for consumer success?
  38. 38. 485,000+ Station additions !
  39. 39. 519,000+ Hours of total listening!
  40. 40. 96%Driven on mobile!
  41. 41. Don’t just build things because brands will pay you for them.
  42. 42. Metrics to Evaluate Your Native Ad Product
  43. 43. Metrics to Evaluate Your Native Ad Product Retention! Session! Length! Latency! Revenue!
  44. 44. Do no harm.
  45. 45. History + Economics - Harm = Native Ad Product Hit me up:! @jackk!

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