Native Ads vs. Display Ads: Pros and Cons

Let’s face it, native ads are a more recent solution. Display ads have been in use for decades, while native advertising has been growing in the last few years. Native ads have been taking the leadership of online advertising and are viewed 52% more times than display ads. With those results, it is no surprise that spending on native advertising is growing.

• It spent 37% more on native advertising. This percentage represents a 39.4% increase over the previous year.

• Native ad spending in the US is expected to reach $83.4 billion in 2022.

Native Ads

Now that we know that native advertising is leading the market, we will explore what native ads are and their performance.

What are Native Ads?

Native Ads are ads that blend with the design and style of the webpage they are placed on. These ads don’t look like ads, but as part of the editorial content on the page.

This non-intrusive ad format, integrates the advertisement to the editorial style of the website, and seems like organic content.

There are three primary forms of native advertising:

Infeed/ In Content ads: these ads integrate into content pieces like blogs or social feeds.

Content recommendation ads: these ads, often in the shape of sponsored content,  are placed alongside the editorial content, for example, at the end of an article or on the side of the page.

Branded Ads: these may appear as sponsored posts in social media or as listings on search engines.

You can find native ads as sponsored posts in social media or blogs. Native ads also appear as paid search units on search result pages of search engines like Google or Bing. Content discovery platforms use recommended content as native ads. Let’s see some examples of effective native ads:

3 Great Examples of Native Ads

1. Stranger Things playlist in Spotify

Spotify is a brand known for leveraging user data to create and enhance the user experience. The Netflix series “Stranger Things” is set in the 80s, which means the show features many iconic songs from that era. Netflix partnered with Spotify to create playlists based on the show’s characters. Spotify users can log into their accounts and enter into “Stranger Things” mode, where they are assigned a Spotify Playlist based on a character of the show.

2. Social media ads

Social media is the most typical example of native advertising. Ads appear in social media apps’ feeds. These social media ads are placed in the user’s feed, matching organic content perfectly.

3. Taco Bell and Snapchat

Taco Bell partnered with Snapchat to celebrate Cinco de Mayo. They sponsored a filter that made users’ faces look like taco shells. The filter successfully got over 224 million views in one day, promoting Taco Bell across Snapchat.

What’s the Performance of Native Ads?

According to a survey by Sharethrough media labs on 4770 consumers, native ads are more effective than display ads. Here are some key findings:

• Native ads are 18% more effective in purchase intent than banner ads.

• 25% more users looked at in-feed native ads than display ads. 

• 53% more users looked at native ads than at display ads. 

Sizes of Native Ads

The size of native ads will vary depending on the publisher’s requirements.  For instance, for Google developers, the most popular sizes are 1,200px x 627px and 600px x 600px.

What Are the Pros and Cons of Native Ads?

Pros

• Native ads build more brand awareness.

• You can target native ads to specific audience segments.

• Compared with other ad formats, native ads engage customers 23% more than display ads.

• Native ads drive a higher click-through rate compared to display ads.

Cons

• There are multiple ways to measure the performance of native ads, you can measure impressions, clicks, views, and so on, which makes it more complex to assess their effectiveness.

• Native ads are more complex to produce because they need to blend with the context.

• Segmenting and targeting the audiences for native ads requires more work. Native ads allow for refined targeting and personalization, which requires more effort from marketers.

Display Ads

What are Display Ads?

Display ads are what most people consider “digital ads.” Examples are banner ads, videos, and interactive and pop-up functions. Display ads typically have a lower click-through rate than other types of ads. However, CTR is not the only measure of a campaign’s success, and display ads improve brand awareness and purchase intent.

Great Example of Display Ads and Why They Work

1. PayPal Vertical Banner

In this side vertical banner, Paypal wants its users to know that they can pay with their Venmo account. This ad’s goal is to create awareness about a new service, so it is not geared to create conversions.

Performance of Display Ads

So, how effective are display ads? Here are some statistics:

• Total display ad spending is expected to reach $143.55 billion in 2022. (Insider Intelligence)

• Digital ads increase brand awareness by 80%.

• Retargeting works: Customers are 70% more likely to purchase from a retargeting ad. (Tech Jury PPC stats)

• A user search increases after seeing a display ad.

• 27% of consumers search for a business after seeing a display ad.

Sizes of Display Ads

• Vertical rectangle

• Mobile leaderboard

• Banner

• Leaderboard

• Square

• Small square

• Rectangle

• Inline rectangle

• Skyscraper

• Wide Skyscraper

• Half-page

Display Ads Sizes

• 240 x 400

• 320 x 50

• 468 x 60

• 728 x 90

• 250 x 250

• 200 x 200

• 336 x 280

• 300 x 250

• 120 x 600

• 160 x 600

• 300 x 600

Pros

• They are easy to set up: Display ads are easy to design and place as there is a wide range of sizes. They can be sized to fit the publisher’s available space.

• Increase brand awareness: Display ads usually have the brand logo and can spread the brand’s reach and recognition.

• Their price can be flexible: Because they come in all sizes, their rates are also flexible. You can adjust the campaign according to your budget.

• Help catch the user’s attention: Most display ads have high-quality images, videos, or animations that are geared to grab the visitor’s attention.

Cons

• They have lower visibility than native ads: Consumers can get overwhelmed by too much advertising, which leads to banner blindness, where they cannot notice ads altogether.

• Their click-through rate is also low: Because they have lower visibility, their click-through rates are lower than other forms of online advertising.

• They can be subject to ad blockers: the number of ads can annoy consumers, so they decide to install an ad blocker.

Key Differences Between Native Ads and Display Ads

Native ads

• It’s a soft sell

• Looks and els like the surrounding content

• High CTR

• The campaigns usually generate higher quality traffic

• They are more expensive per click

Display ads

• It’s a hard sell

• It’s noticeable like an ad

• Low CTR

• The campaigns in common websites usually generate lower quality traffic

• They are cheaper per click

So, Which Is Better For Your Campaign: Native Advertising, Display or Both?

Consumers are bombarded every day with ads popping up left and right. In this digital space saturated with advertising, it is increasingly difficult to grab the consumer’s attention and engage them enough to act. Native ads have the advantage of being unobtrusive, and naturally, they overtake display ads. But display ads are not dead. In reality, you need both since each one serves different purposes.