A native ad blends with the site's aesthetic and allows a user to interact with the ad natively.As the traditional banner ad continues its fade into obscurity, native ads, which coexist more naturally and comfortably with both the flow of editorial content and users’ sensibilities and interests, continue to grow in prominence. The most well-publicized examples are Sponsored Stories in Facebook, Promoted Videos on YouTube, and Promoted Tweets on Twitter. Other editorial sites that trade in native ads include Gawker Media (Sponsored Posts), Reddit (Sponsored Links), and Huffington Post (Sponsor Generated Post).

But as the native ad phenomenon grows, it expands beyond advertorials and paid links. Technology is enabling publishers to stitch together content that appeals to their readership and that fits within the confines of an ad spot. The same technological tools also now allow a small design team to create native ads that match the look and feel of the site, and that even include the types of entertaining and informative content that can be consumed and engaged with within the ad itself.

While its forms vary and innovation continues unabated, there are four  essential elements of a native ad format that performs well and fulfills publishers’ expectations:

  1. Native ads conform to site aesthetics. Their format gives the impression that the same staff who chose the site’s editorial content also chose the ad itself to present to readers. A recent survey conducted by Adobe found that Web visitors are more likely to describe online ads as “annoying” and “distracting” than anything else, and actually prefer television commercials (those things that usurp 36% of a TV show’s broadcast) to online ads. There’s nothing more annoying and distracting than an ad that looks anomalous.
  2. Native ads must be relevant to the type of experience site visitors expect and want. Ads should reflect the values that the site’s editorial content offers, whether that’s sober political commentary or silly cat videos. Provide a jarringly inconsistent experience, and you might send visitors running.
  3. Native ads should allow users to engage with them natively. This means not demanding a click off to another site. Native ads do not disrupt a visitor’s engagement with site content, but instead should add to that experience in a way that a visitor will not only not mind, but appreciate. Control over the ad must remain with the site visitor; 98% of a recent survey’s respondents demanded this.
  4. Native ads should demonstrate what makes a site unique. Publishers should understand what, in terms of content and functionality, keeps users coming to their site, and integrate that into their native ads. If a site's users love engaging with videos, polls, or its Twitter feed, for example, then the site's native ads should include these same meaningful elements. This form of advertising stands to underscore what makes the site unique, and deliver what users value and enjoy.

In turn, publishers stand to gain from presenting advertising in a way that visitors vastly prefer:

  1. Maintenance of site aesthetics. Instead of being littered with incongruous-looking ads, a consistent site look is maintained, and first impressions are positive. This subtly communicates to site visitors that a site’s real estate, even that devoted to advertising, is curated thoughtfully.
  2. Higher engagement and eCPMs. As visitors have clear reason to interact with ads they find interesting, fun, or useful, engagement metrics rise. This translates into higher eCPMs, since engagement is what advertisers pay for.
  3. Lower bounce rates. Ad interaction does not rely on click-through, and visitors are more likely to continue to navigate through and consume a site’s content.

While embracing the cutting edge of native ad development presents a number of palpable rewards to publishers, there are some caveats. Native ads might be enjoying impressive engagement success compared to banner ads, but they can fail without a few vital components.

First, don’t let inappropriate sponsored content destroy your editorial credibility. When the Atlantic, a respected news magazine, decided to run a sponsored post authored by an officer of the highly controversial Scientology church, Twitter users exploded in protest. The post was quickly taken down. As Adweek’s Charlie Warzel perceptively notes, a sponsored post that doesn’t feel like it has editorial blessing will likely stand out to readers, and not in a good way.

Second, make it clear to visitors that interacting with an ad will not force them off the site. Flite client Wikia learned (and corrected) this quickly when an interactive ad unit designed for March Madness was avoided by site visitors. A quick tweak to the ad creative to activate on hover instead of click—along with clearer messaging to visitors—increased engagement nine-fold. Web visitors like to retain control over their navigation, so messaging should clearly indicate what engaging with an ad will entail.

Third, don’t let ads compromise your site’s aesthetics. The impression your page makes in visitors’ eyes matters, and ads are part of that impression.

Finally, publishers should audit themselves and determine what exactly makes them unique, both in terms of their content and site functionality. These points of differentiation ought to form the backbone of the way native ads communicate to and add value to users. The goal for a publisher in creating native ads for a buyer is to convey the brand's message in a format, style, and an engaging form of communication that speaks to a site's particular users, and demonstrates that the user's needs and values are understood.

Let's look at an example. Digg, yesteryear’s social bookmarking phenom, attempted to recapture its past glory with a site overhaul, including “a beautiful, image-friendly, and ad-free experience”. Does this mean Digg has sworn off all advertising revenue? No. Just five months later, Digg’s GM Jake Levine described the new “Apps We Like” feature, in which the editorial team chooses from among app submissions those they believe their audience will like, and then charges the app developer for promotion.

It’s too early to judge the success of the new ad venture, but the fact that Digg’s management doesn’t consider Apps We Like to detract from a beautiful, ad-free experience suggests the sentiment behind native ads has prevailed.