Native Mobile Advertising is the Ad Format of Choice for Millennials

on The Future of Advertising, Millennial

It’s official, mobile ad spend has finally overtaken desktop for the first time. With £802 million (compared with £762 million for desktop) spent in the first six months of 2016, advertisers are finally starting to shift money to a platform commanding serious amounts of time and attention.

This shift in spend indicates the marketing significance of a new generation coming of age. Whilst there’s a lot of generalisation and stereotyping of millennials’ taste and personality traits, one thing that distinguishes them from previous generations is their media consumption. On average, millennials spend nearly 18 hours a day with different types of media, with much of that time spent simultaneously looking at two or more screens at the same time. However, it is the adoption of the mobile phone that really sets them apart from older generations.

Millennials started hitting adulthood around the year 2000, and are now largely settled into their careers. This brings with it increased spending power, believed to be worth $1.3 trillion annually in the US alone. It’s no wonder that advertisers are investing in mobile, trying to reach this valuable audience where they spend their time. The question is, however, are advertisers evolving their communication strategies to effectively reach this generation on mobile?

Experience is everything

To try and get a sense of this, we interviewed 300 millennials at the end of last year to try and understand their unique attitudes, perceptions and behaviour towards digital advertising. We discovered that for them the advertising experience is closely tied to their overall browsing experience. A poor ad experience results in millennials finding ways to block out unwanted messaging - either by moving away from those sites and environments or using technology like ad blockers.

Of those we spoke to that have ad blocking software, 64% told us they use it because the ads were disruptive and made mobile sites look too cluttered. The social platforms have set their expectations for mobile content consumption - it should be simple, fast and look beautiful. Banner ads were a bad solution even on the desktop Internet. They’ve translated to mobile even worse, here, millennials want in-feed native ads that enhance their user experience. This is not only the most effective solution for brands to capture users’ attention, with native getting twice the visual focus of a banner, but when it’s done well it actively improves millennials perception (44%) of the publisher, site or app as well.

Native ads are built to capture the sort of meaningful attention banners never could. Their success comes through being compatible with our new feed mindsets - we now consume content in-feed via headlines, rather than going from article to article. 91% of millennials told us that they primarily discovered content in-feed. Whereas banners were designed to be seen alongside articles on a desktop, native ads are designed to be actually read as part of this mobile browsing experience in the feed.

Mind games

Our neuroscience research has shown us that the act of reading is pretty powerful; reading a native headline triggers neural pathways in the brain that unravel a tapestry of associations in the mind, such as quality, trust, status and brand - together with associations such as loyalty, worth, quality and cost.

Forming these deep rooted associations results in subconscious decision making, a much more powerful force for brands than our conscious decisions, which is actually what advertisers have been longing for and kidding themselves that banners provide.

In our survey of 300 millennials, almost half told us that they thought that brands that used in-feed native ads were interested in establishing a positive relationship with them. While 38% said that in-feed native ads make them more likely to purchase the brand featured in the content. And remember, that’s only the conscious 38%. It’s the subconscious that’s the real motivating force behind many of our actions, including which brands we buy from.

Forrester forecasts 26% year-on-year growth for native advertising between 2016 and 2021. This is compared with 22% for all video formats, 15% for all rich media formats, and 13% for banner ads. With millennials surpassing baby boomers as the world’s largest living generation and now accounting for 27% (2 billion) of the global population, they are going to be a big driver of native’s growth, as the world’s brands learn how to communicate with this generation under the marketing spotlight.

Millennials are the mobile generation and native is the ad unit that was made for the mobile times. The math is simple.

This was originally published in PerformanceIn on November 30, 2016.