New Ad tech Research Conducted By IHS technology, Commissioned By Facebook Audience Network
People have made the shift to mobile. Now, advertisers are shifting as well. By 2020, 75.9% of all digital ad spend will be mobile and the main driver is native. Native advertising is growing at an astounding rate and today’s most successful mobile marketers have already made the switch, according to a new research study conducted by global business analyst IHS Technology and commissioned by Facebook's Audience Network.
According to the research, nearly two-thirds (63.2%) of all mobile display ads will be native by 2020, summoning $53 billion in total advertiser spend globally.
Positive impact on the user experience
Mobile is the most personal device and people expect great experiences. The study also found that consumers engage with native ads 20-60% more than standard banner ads. People have trained themselves not to look at the top or bottom of an app. An ad that is well integrated within the app or site design and naturally fits into the user flow has a much better opportunity of catching a user’s attention and ultimately leads to higher conversion rates. Native is less likely to lead to user churn and ad fatigue, and drives higher retention rates (up to 3x), eCPMs (up to 2x) and click-through rates.
Audience Network - the largest native ad network in the world
While first party in-app native — like on Facebook or Instagram — will continue to be the largest mobile native revenue driver, third party in-app native — operated and served into an app by an outside partner such as Facebook's Audience Network — will be the fastest-growing. Third-party is expected to grow at an annual rate of 70.7%, and will account for 10.6% of all mobile display ads ($8.9 billion) by 2020. We're seeing this trend play out right now at Facebook. The percentage of apps using native ad formats on the Audience Network has grown 10x from Q1 2015, and they now make up 83% of our entire network with up to 7x higher CPMs compared with banners. Today, more than 50% of apps on the Audience Network are using native ads exclusively.
For more, please check out the blog post and the infographic:
Blog: https://www.facebook.com/audiencenetwork/news-and-insights/native-advertising-forecast-2020?__mref=message_bubble
Infographic: https://www.facebook.com/audiencenetwork/news-and-insights/future-of-mobile-advertising-is-native-infographic
Statement: "The growth of the native ad market – to $53b by 2020 – is a mandate against bad ads. Native is the best experience for people because it respects their experiences, especially on mobile. For publishers, this can mean longer time spent on your property and increased revenue. For advertisers, native can mean more value for your business. On Audience Network alone, which is 83% native, we see CPMs 7x higher for native compared with banners."
Key Statistics (from the research)
- By 2020, 75.9% of all digital ad spend will be mobile.
- Native advertising will generate 63.6% of all global mobile display advertising and amount to $53.0bn by 2020.
- While first party in-app native, like those served on Facebook or Instagram, will continue to be a major revenue driver, third party in-app native (like those served on outside publishers through AN) will continue to grow, at an annual average rate of 70.7% and will account for 10.6% of all mobile display advertising at $8.9bn by 2020.
- In EMEA, native advertising will amount to $9.6bn by 2020 (1.3B third party native). In APAC, native advertising will amount to $14.1b by 2020 (3.6B third party native)
- APAC will record the largest increase in native advertising spend in next five years at a 177% compound annual growth rate between 2015-2020
Native + Audience Network (not from this research – by Facebook)
- We are seeing this trend play out on Audience Network.
- The percentage of apps using native ad formats on the Audience Network has grown 10x from Q1 2015, and they now make up 83% of our entire network.
- Today, more than 50% of apps on the Audience Network are using native ads exclusively. It is the largest native ad network in the world.
- CPMS are 7x higher for native compared with banners.
Native Advertising Will Be the Majority of Mobile by 2020
By: Yoav Arnstein
Native advertising is growing at an astounding rate and today’s most successful mobile marketers have already made the switch, according to a new research study conducted by global business analyst IHS Technology and commissioned by Facebook's Audience Network.
As part of its research methodology, IHS conducted a series of in-depth interviews with leading publishers, app and game developers, trade associations, agencies, music services, ad networks and tech vendors in 25 countries across Europe, Asia-Pacific and the Americas.
According to the research, nearly two-thirds (63.2%) of all mobile display ads will be native by 2020, summoning $53 billion in total advertiser spend.
While first party in-app native — like the ads you see on Facebook or Instagram — will continue to be the largest mobile native revenue driver, third party in-app native — operated and served into an app by an outside partner such as Facebook's Audience Network — will be the fastest-growing. Third-party is expected to grow at an annual rate of 70.7%, and will account for 10.6% of all mobile display ads ($8.9 billion) by 2020.
We're seeing this trend play out right now at Facebook. The percentage of apps using native ad formats on the Audience Network has grown 10x from Q1 2015, and they now make up 83% of our entire network. Today, more than 50% of apps on the Audience Network are using native ads exclusively.
The study also found that consumers engage with native ads 20-60% more than standard banner ads. Native is less likely to lead to user churn and ad fatigue, and drives higher retention rates (up to 3x), eCPMs (up to 2x) and click-through rates.
As more traffic moves to mobile, more and more advertisers are shifting their budgets in kind, study participants said. These include not only digital-first retailers, but larger brands as well. The publishers, developers and advertisers who stand to benefit the most from native will be those who move fastest to adopt.
The full results of the study, “The Future of Mobile Advertising is Native,” are available to read now – let us know if you would like the report.