The Year in Native Ads

If 2013 was a year of hand wringing over so-called native advertising -- a tactic in which ads are meant to mimic editorial content -- 2014 was all about adoption and investment. This year, in fact, brands were expected to spend $3.2 billion on the tactic, up 46.7% over 2013, according to research firm eMarketer. Outlays for native advertising are forecast to continue rising in 2015 to $4.2 billion. But before those investments take hold, here's a look back at the year in content marketing -- the popular advertising strategy where brands produce and publish articles, videos, images and social posts. January The New York Times introduces native ads. Despite some reservations from its newsroom, The New York Times ran the first native ad on its website Jan. 8 in the form of an article series from Dell. The articles were clearly labeled as promotional, although those labels would shrink slightly as the year progressed. In the following months, the Times minted T Brand Studio, a separate team that makes native ads for clients. It was expected to run 40 of these campaigns by the end of 2014. Investors pour millions into content arms race. Companies that provide services -- including software, analytics and freelance writers -- to brands for their content-marketing efforts saw an influx of cash this year, starting in January when NewsCred raised $25 million and Contently nabbed $9 million. In March, Percolate got $24 million in funding, and a few months later, in July, Simple Reach scooped up $9 million. March Samsung teaches America about the selfie. Samsung bought more than five minutes of commercial time during the Oscars broadcast, but it was a selfie and a tweet that sparked a frenzy of attention. The company gave Academy Awards host Ellen DeGeneres a white Samsung Galaxy Note 3, which she used to snap a picture of herself and a host of celebs. The subsequent tweet racked up more than 3 million retweets in two days. The Wall Street Journal jumps into the native-ad game. The Journal's push into native advertising might seem like an also-ran after the Times if it weren't for the paper's Editor-In-Chief Gerard Baker calling the practice a "Faustian pact" -- that's a deal with the devil -- less than six months earlier. On the eve of the Journal introducing native ads to its website, Mr. Baker told Ad Age, "I am confident that our readers will appreciate what is sponsor-generated content and what is content from our global news staff." May Wired and Netflix impress with splashy native ad. The Times was praised in June for its native ad about women's prisons for the Netflix series "Orange is the New Black," but Wired magazine actually beat the Times to this high-water mark of native-ad quality when the Conde Nast title published an article on its website about the future of TV. The article was from Netflix and would help set off a cascade of snazzy-looking native ads from other brands and publishers. June Content marketing comes up empty at Cannes. Eleven campaigns earned Gold Lions in the three-year-old branded-content category at Cannes this year, but none of them took home a Grand Prix. It was the first time since 1995 that no top honor was awarded in a category at Cannes. Several months later, Ad Age asked why. July Business-to-business marketers struggle to prove ROI of content marketing. A study released in July threw a little cold water on the content-marketing hype. Just over half -- 51% -- of marketers told researchers from Forrester that their content-marketing efforts are only somewhat effective. August John Oliver skewers native advertising. When it seemed the only people who cared about native ads were marketers and media executives, comedian John Oliver dedicated 11 minutes of his half-hour HBO show "Last Week Tonight" to lampooning the practice. (The video now has more than 3 million views on YouTube.) Execs from Time Inc. and The New York Times are among those Mr. Oliver calls out. BuzzFeed raises $50 million. The website with a business model based almost entirely on native-advertising got a $50 million investment from prominent venture-capital firm Andreesen Horowitz. That values the company at roughly $850 million. Also in August, BuzzFeed named a new president, Greg Coleman, who told Ad Age about his visions of combining native ads with programmatic ad-selling technology. September Kraft gets boffo ROI on content. Julie Fleischer, Kraft's director of data, content and media, said at this year's Content Marketing World conference that the company now generates the equivalent of 1.1 billion ad impressions a year and a four-times-better return-on-investment through content marketing than through even targeted advertising. November Native ads goose quarterly earnings. Thanks to brands' interest in content marketing, third-quarter earnings reports showed that the practice of making ads look like non-commercial content was driving revenue gains at a variety of media companies, from The New York Times to LinkedIn. The Times, for instance, reported a 16.5% increase in digital-ad revenue during the third quarter compared with the same time last year. And LinkedIn saw third-quarter ad revenue of $109 million, a 45% increase over the previous year. December Verizon's content marketing experiment ends abruptly -- and with a black eye. In December, Verizon Wireless shuttered its content marketing site SugarString just two months after the site's introduction. The closure came after the site's editor reportedly told aspiring writers that coverage of net neutrality and espionage were not allowed on the site. Verizon denied the claim, but the damage was done and the site dead.

The Year in Native Ads

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