Tracking Native Programmatic, The Progress And Pitfalls

nativeProgrammatic native is scaling, but the rate of progression hasn’t been rapid, according to agencies and ad tech vendors.

While most major demand-side platforms (DSPs) can place ads on Facebook or Twitter – the most common strain of native inventory being social/in-feed ads – native programmatic platforms like Sharethrough, TripleLift and Nativo seek to corner the market with big independent publishers.

Native exchanges have been actively ushering digital DSPs into the fold, particularly after the Interactive Advertising Bureau ratified the OpenRTB 2.3 spec last February.

OpenRTB 2.3 aimed to set a standard for how native ads are bought and sold and provided support for deeper metadata to be embedded within the bid request, such as headline, thumbnail image, brand name, logo and description.

Effective placement of a native ad requires assets be dynamically rendered to mimic the look and feel of whichever publisher environment they are plugged into.

The updated spec offered great promise, particularly for pushing beyond banners in mobile.

“The RTB 2.3 enables huge swaths of native inventory to be biddable and programmatically enabled,” noted Steve Katelman, EVP of global strategic partnerships in digital at Omnicom.

But Katelman acknowledged that DSPs have been slow to adopt native inventory, despite a deepening supply pool. James O'Neill, VP of integrated marketing for MDC Partners' agency Assembly echoed the thought.

"I think native programmatic is here due to technology built by the likes of TripleLift and Nativo, but the problem on the buy side is the creative specs are very unique and it's difficult to relinquish control over the assets without knowing how they will truly be deployed in all circumstances," he said. "We've gotten our clients on board, but it takes a bit of hand holding to start."

Overlooking the possibility that marketers aren't ready to buy native inventory programmatically, there are tech-based challenges as well. Native integrations require DSPs to meet new technical standards, given the diversity of formats and publisher specificities.

That takes resources, especially for smaller ad tech startups.

“You see some, who are 100- to 300-person private businesses, in maintenance mode and who want to lock down their core business,” said Dan Greenberg, CEO of Sharethrough, a native ad exchange. “To them, sometimes native or in-feed ads are just another format to add to the road map.”

But Greenberg, unsurprisingly, anticipates native will be a predominant form of inventory as mobile and in-feed environments proliferate. He argued native is a category as significant as banner and pre-roll.

And as buyers increase their spend, DSPs are also increasing their capabilities. In other words, Omnicom’s Katelman added, buy side support for native is not stymying the flow of more demand dollars to native exchanges.

Certainly not every DSP has been slow to integrate native. Buying platforms that focus on video and branding opportunities see the value in native (done respectfully) to aid in storytelling, while those ingrained in direct-response might be focused on other outcomes that require, for instance, app install ads.

2016: Video Before Native?

For some DSPs and programmatic marketing companies, native was a 2015 development priority. For others? Not so much.

In a way, this sentiment toward native hasn’t changed all that much in a year. While the supply side notes buyer investment in native programmatic has been deliberate (or plain slow), sources say it’s not so much a disconnect between buy- and sell-side tech vendors as it is realizing true advertiser demand.

Some of this is partly due to semantics.

"I think there is confusion to what native actually is," commented Rob Griffin, chief innovation officer of the Boston-based agency Almighty. "A lot of 'native' is just rich media in the form of native. Then there are additional requirements for the advertiser [to provide] relevant messaging that fits the context of [the native spec]. That touches the overarching issue with programmatic overall - the sheer lack of programmatic creative and dynamic personalization."

Aaron Kechley, SVP of products at DataXu, noted that RTB access to native inventory still isn’t the top agenda item for most advertiser clients. Instead, they are far more focused on “video everywhere,” the marriage of cross-device technology and video.

Similarly, while native is a road map opportunity for Rocket Fuel, according to CTO Mark Torrance, “one of our top priorities (for 2016) is our video offering, which is in lock step with demand we are seeing from our clients.”

Turn acknowledged that, aside from FBX, native volume on its platform is not high compared to mobile, video or display. Still, it will make key native workflow enhancements in the second half of the year (after its video ramp-up).

MediaMath said it saw roughly 110 billion native ad impressions a month. Both display and video are key channels for MediaMath, “but social, mobile and native are growing rapidly,” according to Eric Picard, MediaMath’s VP of omnichannel media. “Native is one of our top priorities, particularly as dynamic creative takes off, and we are investing heavily in growing the capability.”

orville copyConsequently, native RTB ad tech companies like Sharethrough and TripleLift are heads-down on new demand integrations.

“The suppliers who are getting the early budgets like TripleLift have wisely developed self-service creative conversion tools that reduce the need for changes in the established buy-side platforms,” DataXu’s Kechley said.

Sharethrough integrated with The Trade Desk last week, its second major DSP partnership since its integration with AppNexus last September.

“We’ve eased into this over the past year or so,” said Tim Sims, VP of inventory partnerships at The Trade Desk.

The Trade Desk now works with Sharethrough, TripleLift and YieldMo, but Sims noted more traditional supply sources are also starting to support native.

Growing native is a cornerstone of The Trade Desk’s expansion into omnichannel. In Q2, its “official” move into native will include support for video, mobile and in-feed display both in form and function.

Ari Lewine, co-founder of TripleLift, who is one of the co-chairs of the IAB's Native Advertising/Content committee, noted the platform’s latest integration to DataXu.

TripleLift, however, was already integrated into major buying platforms for well over a year, including Google DoubleClick Bid Manager, The Trade Desk, MediaMath, Turn and AppNexus beyond just a simple plugin.

“All have committed to build in-native support, meaning you can go in their interfaces and seamlessly traffic a native campaign the way you would any other campaign,” he said. “That’s a new development this year. Before, the workflows wouldn’t occur directly within the DSPs’ own interfaces.”

What’s Next For Native?

BI Intelligence predicts native ad spend will explode, growing from $7.9 billion in 2015 to $21 billion in 2018.

With that uptick, Lewine expects players and formats that aren’t inherently native to bucket themselves in an increasingly lucrative category.

The stakes are especially high for native. The FTC is cracking down on native ads that may be misconstrued, particularly around sponsored posts or social influencer campaigns that are insufficiently disclosed as such.

But those seeking to connect supply and demand through native exchanges say the very market they’re looking to propagate is often associated with a word that’s thrown around too loosely.

“We exclusively do in-feed native ads,” Lewine reiterated. “We don’t do any standard IAB formats. You, however, see some rich-media or high-impact players doing flash and pop-and-expand takeovers with tiny x’s to click out, masking as native.”

Sharethrough’s Greenberg concurred.

“We don’t do banners, pre-rolls, interstitials,” he said. “As users become more in control of their ad experiences, in-feed native mobile won’t be a small niche part of the market. We see it as the most material inventory source across the whole web.”

Lewine also predicted more of a blurring of the lines between performance and brand campaigns, where native is more of a no-brainer right now.

Once buyers can plan and test native ads alongside banner ads through the big digital exchanges, “native will be a part of every campaign,” Lewine said. “The future DSP has video, native, mobile, cinemagraphs … and the DSP will decision accordingly.”

 

Correction: Lewine is a current co-chair of the IAB's Native Advertising and Content Committee, along with Greenberg, not its working group as previously stated. The story has been updated to reflect that change.

2 Comments

  1. And one more thing to add to the discussion, what about the for the native ad content? That is a challenge to solve in the programmatic scene. Many publishers won't be comfortable allowing any kind of content to appear in their feed.

    Reply
  2. Why is Nativo mentioned as a programmatic native platform, and a vanguard one at that? Just a week before this article, their SVP wrote a piece about the "risky business of programmatic native" - http://adexchanger.com/data-driven-thinking/the-risky-business-of-programmatic-native/ - and they certainly aren't the first or that big in that market.

    Also TripleLift is completely built on top of AppNexus and one of the early programmatic native companies but it seems like AppNexus pushed them aside late last year by announcing ShareThrough as the "first" native programmatic partnership.

    With the inevitable commoditization of features and inventory brought upon by programmatic, along with the race to the bottom, it's going to be interesting to see how TripleLift, ShareThrough and the rest differentiate themselves, if they can at all.

    Reply

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