How Multi-Format Auction Adds Value For Advertisers

The Evolution of Native Advertising

Native advertising has arguably been around in some shape or form for over 100 years, but it is only in the last decade that it became known as a ‘phenomenon’ in the digital advertising sphere. Native ads are strategically positioned within organic content, making them seem less like advertisements and more like the form of content you are already viewing. For example; an ad for a particular airline sale placed on the site where you are booking a flight.

Native advertising encompasses a variety of different elements and can, therefore, be quite difficult to categorize. The varying and often conflicting objectives of different companies’ approach to native ads results in a fragmentation of what ‘native advertising’ truly means. Native ads are built from a variety of different “metadata elements, such as a headline, thumbnail image, content URL, description text, and more” so often they can be served in a range of different placements due to this variety.

Companies such as Facebook and Google have different guidelines in place for serving native ads, including which elements are required and which ones are just recommended. The guidelines in place from Google Ad Manager, for example, allow formats to compete for the best performing placement, ensuring that advertisers can maximize their reach.

Addressing Various Audiences With Multi-Format Auction

Online audiences are more diverse than ever and can be reached on a number of various platforms and devices and it is argued that advertisers can no longer adopt a ‘one size fits all’ approach when it comes to running campaigns.

With this audience fragmentation in mind, it’s important for advertisers to reach the relevant person at the relevant time. Multi-Format Auction involves the serving of multiple ad formats in just one placement and opens up a world of possibilities for publishers and advertisers alike. Publishers can access multiple demand sources and advertisers can gain access to users they may not have previously been able to address as apps may not have certain formats available.

For example; publishers may not have native placements within their apps, so buyers run the risk of losing reach to particular audiences. Multi-Format Auction can also benefit advertisers as they can access significant portions of inventory not available elsewhere at a competitive price.
Native Banner Ad. Source: MoPub
Native Banner Ad. Source: Google AdMob
Driving Better KPIs From Serving Multiple Formats

Advertisers measure their key performance indicators (KPIs) in different ways so by serving numerous types of ad formats in one placement, their goals have a higher chance of being met. The performance of campaigns is an important metric for calculating the ROI of advertiser’s ad spend, but what is even more critical is to look at the user level to achieve a healthy ROI growth by expanding your relevant audience reach. Often ads with native elements can be served as a banner if they are the best performing format.

Native Banners’ differ from traditional banner ads as they are not as intrusive for users. This is due to the relevant content which is displayed for users at the right time, containing elements which make them native to the experience the user is currently in. These elements can include an icon, title, description, call-to-action button, etc. As a result, the user experience is not damaged and advertisers can achieve their pre-defined KPI’s for campaigns. Native banners also have a much higher click-through rate than traditional display ads and advertisers can buy this inventory at a reasonable price with Multi-Format Auction.

One definition of native advertising is described as “paid advertising where the ad matches the form, feel and function of the content of the media on which it appears”, however, the whole concept of ‘what is native’ is so broad that it truly lies in “the eye of the beholder”. Ideally, the definition would not be as fragmented or multifaceted and each advertiser would know exactly what they are buying each time, which OpenRTB is working towards addressing.

However, until we reach this ideal world where there’s a definitive categorization of native advertising, we should focus on advertisers’ campaign objectives and connect their ads with the right users, regardless of which format. (For example, native video on YouTube mobile app would be performance-based, whereas native video on YouTube via Apple TV for the same user would be mainly a branding campaign.)

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