Native Advertising Is Growing in Financial Importance

Publishers have seen a 10% bump, over the last two years, in the revenue they make off of native advertising, and the trend is expected to continue.
native advertising revenue

In three years time, publishers expect native to drive 46% of ad revenue.

For the past five years, at least, native advertising has been on the agenda or on the minds of advertising executives—and for good reason.

According to a new report put out by the Native Advertising Institute and FIPP, native is increasingly making up a larger chunk of advertising revenue for magazine publishers. On average, native made up 31% of overall advertising revenue for magazine publishers in 2017—up from 21% in 2016.

It’s no surprise, then, that this has lead to increased expectations among publishers for the 2018 results respectively. 69% of the magazine publishers expect that native will have driven more of their annual advertising revenue this year than last year.

These numbers are only expected to go up. In three years time, publishers expect native to drive 46% of ad revenue.

 

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As native continues to rise in financial importance, publishers will need to think critically about how they incorporate native into their strategies and respective organisations. Many publishers already are.

“After testing the waters for a few years now, many publishers have made native advertising a fully integrated part of their business model. Smaller and more niche publishers are still somewhat hesitant, but most major publishers are all in,” Jesper Laursen, Founder and CEO of the Native Advertising Institute, states in the report.

It is impressive what the industry is achieving.

Increase in in-house studios

Already now, 55% of magazine publishers are running native ads and another 29% are likely or very likely to pursue it in the future.

This increasing prevalence has made publishers deeply consider how native will fit into their organisations and sale structures. For instance, publishers seem to be turning away from using editorial teams to carry out native advertising activities, and are, instead, embracing an increasing reliance on in-house studios or a separate native advertising teams with dedicated sales.

The industry has moved fast, and it seems it will continue to. In the words of Jesper Laursen:

“Magazines are holding their heads up high in terms of native advertising and rightfully so. It is impressive what the industry is achieving.”

Download the full report here.

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