Back in the day, banner ads were the height of marketing sophistication, with the advent of programmatic making large-scale, targeted delivery of these digital billboards quick and affordable.

But following a global epidemic of banner blindness and a rise in ad blocking, traditional display banners are quickly falling out of favour. UK banner spend declined 8% last year according to the IAB Digital Adspend study, and Magna Global predicts banner ad sales will shrink by 3% across the globe this year. Major industry players such as Facebook don’t use banners – in fact only 10% of social ad spend was spent on this format in 2016.

Marketers are now focussed on the need for immersive, dynamic programmatic ad formats that harness cutting-edge technology and data-driven insights to create a better user experience – effectively ruling out traditional banner placements.

So if we know banner ads don’t work why are we still using them? And if the format is living on borrowed time, what will replace it?

The drawbacks of banner ads

Heading the long list of complaints about banner ads is the fact they can be extremely disruptive to the user experience, clumsily blocking access to the content that users intend to read. Banners can easily generate accidental clicks as consumers hunt for the tiny cross that will free them from interruption.

This intrusiveness is especially problematic on mobile devices where smaller screens make the banner format – designed in the 1990s – completely inadequate. With mobile now accounting for over a third of total UK media ad spend, continuing to invest in a format that is not optimised for the small screen is nonsensical and mobile could be the final nail in the coffin if banner ads don’t evolve.

But disruption and accidental clicks aren’t the only issues with banner ads. They are often poorly designed, with out-dated creative, and are frequently used as clickbait; intended to attract user attention but failing to fulfil the promise they make once the user takes the desired action. These issues can potentially damage relationships between the consumer and the brand.

Moving beyond the banner

Despite their many flaws, banner ads remain the default option for advertisers and the mainstay of the digital landscape. When asked why banner ads still saturate the market, publishers and advertisers agree it is down to the slow uptake of alternatives, but disagree over who is to blame. Advertisers feel publisher sites are not yet set up for more current ad units, while publishers feel advertisers are unwilling to invest in developing non-banner creative.

But with viewer fatigue increasing and ad blocking likely to rise again once Google introduces default ad blocking in Chrome, publishers and advertisers alike are now crying out for alternative formats. Many publishers are introducing custom ad placements on their websites and mobile apps in an attempt to improve the user experience, and big brands are investing in rich ad experiences such as video to replace the standard banner. In mobile, the industry is moving away from the click as the main engagement gesture and moving towards more purposeful actions such as swipes to limit accidental interactions.

Yet these developments do not provide a satisfactory answer as new ad formats still interrupt the user experience. Advertisers and publishers enjoy the scale and efficiency automation brings, but they want an integrated, non-intrusive, consumer-centric programmatic format that will allow them to engage and build trusting relationships with their audiences. Native programmatic provides that solution.

Why native is the future of programmatic

Today’s internet users want to be marketed to in a transparent and relevant way that does not spoil their enjoyment of the content they are consuming. Native delivers high quality advertising that fits seamlessly into the form and content of a web page, automatically adapting to its environment to give the best possible user experience across all screens and platforms without being intrusive or annoying.

As long as native ads are clearly labelled as such – and are not attempting to deceive the user by masquerading as editorial content – they are far more engaging than banner ads, generating significantly higher click-through rates, particularly on mobile.

Social networks – which are largely designed to be mobile-first – are driving the progression of native due to the need for ads to fit seamlessly into the user’s content feed or timeline. In the US, almost 85% of native display ad spend originates from social, although this is likely to change as native adoption escalates for non-social publishers and the rise of native programmatic makes it possible to deliver high-quality, precisely targeted native ads at scale.

Programmatic itself has a poor track record when it comes to transparency and brand safety – with reselling and re-brokering meaning advertisers are often unsure where their ads will appear – but native is helping to clean up the programmatic ecosystem. Through the use of private programmatic native networks, advertisers have much more clarity over the inventory they are buying, and can be certain of organic traffic and brand safe ad placements on websites or mobile apps that make user experience their top priority.

Native is the natural successor to banners ads, as the industry as a whole inevitably reduces its reliance on this out-dated form of display advertising and looks towards a programmatic format that enhances rather than intrudes on the user experience. With native programmatic, advertisers can still enjoy the benefits of automation while improving transparency and brand safety, and building trusting relationships with satisfied consumers.

 

By Alex McIlvenny, UK country manager at Ligatus


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