University of Groningen

Native Advertising: Effective, Deceptive, or Both?

Harms, Bianca

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10.33612/diss.162005726

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Harms, B. (2021). Native Advertising: Effective, Deceptive, or Both? [Thesis fully internal (DIV), University
of Groningen]. University of Groningen, SOM research school. https://doi.org/10.33612/diss.162005726

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 Chapter 2⎪Digital native advertising: practitioner perspectives and a
research agenda

This chapter is based on: Harms, B., Bijmolt, T.H.A., and Hoekstra, J.C. (2017), Digital native
advertising: practitioners’ perspective and a research agenda, Journal of Interactive
Advertising. 17 (2), 80-9.
22 ⎪Chapter 2

2.1 Introduction
Commercial collaborations between advertisers and publishers range from traditional
product placements, with low contextual integration, to fully integrated native advertising.
Native advertising “takes the form and appearance of editorial content from the publisher”
(Wojdynski & Evans 2016, p. 157), and practitioners increasingly devote their budgets to digital
native advertising, because of its effectiveness compared with other types of digital advertising
(Vranica, 2016; Wang & Huang, 2017). In Western Europe for example, native advertising
appears poised to expand by 156% between 2015 and 2020, such that it may come to represent
up to 52% of all digital display advertising (Enders Analysis, 2016).
A key reason for this growth is the new opportunities that digital native advertising
creates for various stakeholders involved in advertising. For example, brands gain access to a
new means to achieve their marketing communication goals, across a wide span of media
platforms that can circumvent advertising blocks. Publishers can generate alternative income
streams by offering new services that compensate for declining incomes from traditional
advertising (Probst et al., 2013). Audiences might benefit from gaining access to content that
expands on the regular editorial content and thus offers more value than plain advertising (Tutaj
& Van Reijmersdal, 2012).
Together with these distinct advantages, digital advertising also requires unique
approaches to content, context, and evaluation relative to traditional advertising (Truong et al.,
2010). Although digital native advertising is widely used, the factors that determine its
effectiveness have been poorly addressed by research thus far (Wojdynski & Evans, 2016);
studies of the circumstances in which digital native advertising is more or less effective are
particularly lacking.
To contribute to this field, this study therefore seeks to delineate content and context
factors influence its effectiveness, as well as clarify digital native advertising effectiveness in
terms of both intermediate and behavioral effects. To do so, we undertake an extensive literature
review and interviews with industry experts. The dynamic developments in advertising,
technology, and consumer behavior have moved industry practitioners to the forefront of digital
advertising developments, making them the most appropriate information sources for this
research project. From interviews with 22 expert respondents, we derive 10 key propositions
that reflect practitioners’ perspectives; these propositions in turn form an important research
agenda for continuing studies of the effectiveness of digital native advertising.
 Native Advertising: Effective, Deceptive, or Both? ⎪ 23

2.2 Literature Background

A key characteristic of native advertising content is its integration into the media
context, such that the “marketer borrows from the credibility of a content publisher’s original
content” (Wojdynski & Golan 2016, p. 403). The embeddedness of native advertising in turn
influences the decisions that advertisers make for their advertising strategies, including their
choices about context and content, in an attempt to influence consumer behavior. Prior literature
offers some insights into these content and context factors, as well as appropriate effectiveness
measures for digital native advertising, which underlie our research framework.

2.2.1 Effective digital native content

Integrated advertising can prompt positive consumer responses, more so than traditional
forms of advertising (Nebenzahl & Secunda, 1993; Russell, 2002; Van Reijmersdal et al., 2005;
Tutaj & Van Reijmersdal, 2012). Their positive evaluations often result from the higher value
that consumers assign to advertising that appears more informative and amusing and less
irritating (Tutaj & Van Reijmersdal, 2012). The similarity of native advertising content to
editorial content suggests two important variables for investigation: brand prominence and
message appeal.
Brand prominence. Determining an appropriate degree of brand prominence is essential
for digital native advertising. That is, prominent advertisements contain highly visible product
or brand identifiers (Gupta & Lord, 1998), but digital native advertising is a subtle advertising
type, with low brand visibility. The level of brand visibility depends on the exhibition and
position of the brand name, logo, or URL (Wojdynski, 2016; Wojdynski & Evans, 2016).
Advertising that features low brand prominence, such as digital native advertising, still can be
effective though, especially in terms of the influence detailed in persuasion knowledge theory
(Boerman et al., 2014; Wojdynski & Evans, 2016). That is, consumers progressively acquire
knowledge about how, why, and when a message is intended to influence them (Cowley &
Barron, 2008). This persuasion knowledge helps them respond to persuasive attempts (Friestad
& Wright, 1994) by activating their defense mechanisms (Boerman et al., 2014; Nebenzahl &
Secunda, 1993). The moment a consumer recognizes a persuasive attempt, a “change of
meaning” occurs (Friestad & Wright, 1994, p. 13). According to Bhatnagar et al. (2004),
because integrated advertising hides its persuasion motive, it can enhance brand performance;
however, if the brand is not prominent enough, it cannot exert an affect, because the audience
does not relate the content to the brand
(Van Reijmersdal, 2009). A recent study of advertiser disclosures in digital native advertising
24 ⎪Chapter 2

indicates that only 8% of participants recognize the content as advertising (Wojdynski & Evans,
2016). Furthermore, the low degree of brand prominence in native advertising may lead to
perceptions that it is a misleading tactic, which could prompt negative evaluations of the
advertising, the brand, or the hosting platform, through spill-over effects (Thota et al., 2012).
In contrast, if the brand is too prominent, persuasion knowledge gets activated, which also could
lead to negative consumer evaluations (Van Reijmersdal, 2009; Wojdynski & Evans, 2016) and
lower engagement with the content. In a blogging context, Van Reijmersdal et al. (2016) find
that advertiser disclosure leads to cognitive and affective resistance. Negative affect in turn
leads to negative attitudes toward the advertised brand; positive attitudes produce higher
purchase intentions (Van Reijmersdal et al., 2016). Considering these conflicting potential
effects, it is important to glean practitioners’ perceptions and experience to determine what they
consider the appropriate degree of brand prominence in digital native advertising.
Message appeal. The type of message appeal (informational or emotional; Holbrook &
Batra, 1987) also likely influences the effectiveness of digital native advertising. Advertising
that is informational provides predominantly facts; emotional advertising content contains
information that highlights psychological characteristics related to the consumer experience
(Holbrook & Batra, 1987). The appeal type should match the type of product being advertised
(Johar & Sirgy, 1991). Golan & Zaidner (2008) argue that most digital messages contain
emotional appeals, which invoke greater consumer engagement (Berger & Milkman, 2012), but
Ashley & Tuten (2015) show that most brands use informational content in their digital
advertising. These contradictory findings justify further explorations of the appeal types used
most commonly in digital native advertising.

2.2.2 Effective context

The choice of the advertising context refers to where to place content to guarantee the
most effective exposures with an available budget. For native advertising, a key feature is the
attempt to leverage the anticipated spillover of credibility from a publisher’s editorial content
(Wojdynski & Golan, 2016).
Therefore, this study focuses on the media context in which digital native advertising
may be most effective. Because digital native advertisements are mostly unique and developed
for specific platforms, advertising frequency is less germane.
The growing variety of channels that distribute digital native advertising content, across
a wide range of consumer devices, complicates advertisers’ decision making with regard to
media contexts, yet these contexts have significant influences on consumers’ evaluations of
 Native Advertising: Effective, Deceptive, or Both? ⎪ 25

embedded advertising (Krugman, 1983; Jeong & King, 2010). The advertising context typically
refers to characteristics of the medium or surrounding content, in which an advertisement gets
inserted (De Pelsmacker et al., 2002). For example, De Pelsmacker et al. (2002) find that a
positive evaluation of the context surrounding television and print advertisements results in
more positive attitudes toward those advertisements. In the context of digital native advertising,
this effect has not been studied. Furthermore, the embeddedness of digital native advertising
content might require greater congruence with other content on the platform. However, prior
research offers contradictory findings regarding context–advertisement congruency: Some
studies identify positive effects of a congruent advertising context on ad effectiveness ( Sharma,
2000; Jeong & King, 2010; Kononova & Yuan, 2015), whereas others support the placement
of advertising in contrasting contexts (Perry et al., 1997).
In addition to content on a platform, the platform itself and the device that consumers
use to access that platform likely determines the effectiveness of digital native advertising. For
example, audience responses to branded content in magazines are influenced by the
characteristics of that medium (Van Reijmersdal et al., 2005), and for digital advertising, a
relevant website can enhance evaluations of banner advertisements (Jeong & King, 2010). The
penetration of smartphones and other devices into consumers’ lives has led to an enormous
increase in spending on mobile advertising (Grewal et al., 2016). Mobile advertising gets
consumed on a small screen, generally without any other visible advertisements (Grewal et al.,
2016), so digital native advertising may be particularly effective on mobile devices, because
consumers’ attention focuses strongly on the available content.

2.2.3 Effectiveness
The digital advertising landscape provides many opportunities to influence consumers
throughout their decision journey, that is, during the phases in which consumers interact with
brands prior to, during, and after their buying decision (Edelman, 2010).
Advertisers aim to achieve various effects, such as changing consumers’ beliefs,
attitudes, and behaviors (Vakratsas & Ambler, 1999). Accordingly, the notion of digital
advertising effectiveness has been defined and applied in various ways. For example, digital
branded content might create intermediate brand effects, such as attitude changes (Becker-
Olsen, 2003; Tutaj & Van Reijmersdal, 2012), but also could exert influence over behavioral
effects, such as purchase intentions (Becker-Olsen, 2003). Prior studies indicate that integrated
advertising leads to more positive evaluations (Becker-Olsen, 2003; Tutaj & Van Reijmersdal,
2012), though current debates about the potential deceptive character of native advertising
26 ⎪Chapter 2

could invoke more negative attitudes. In digital settings, behavioral effects mostly involve
conversions, which might imply a purchase or other action (e.g., active search, click,
engagement; Moran et al., 2014).
Many studies of the effectiveness of digital advertising rely on achieved click-through
rates (CTRs), but this metric ignores the indirect effects of ad exposure (Braun & Moe, 2013).
As CTRs continue to decline (Becker-Olsen, 2003), other measures, such as engagement
manifested in the form of sharing or commenting, may offer more valuable behavioral insights.
Advertisers increasingly use new media communication strategies to create engagement in
order to shape consumers’ perceptions of brands or organizations (Grant et al., 2015). Such
interactions create word-of-mouth effects, with vast reach and impact, especially considering
the speed of diffusion and disruption of geographical boundaries (Risselada et al. 2014).
Evaluations of the effectiveness of digital native advertising thus should include both attitudinal
and conversion measures.
This literature review led us to select the components presented in Figure 2.1 to
represent our research framework, which in turn serves as an agenda for our interviews.

Figure 2.1: Research Framework for this Chapter.

 Native Advertising: Effective, Deceptive, or Both? ⎪ 27

2.3 Methodology
This study adopts a qualitative research approach, which is less common in academic
marketing research, despite its applicability for capturing contextual factors that underlie
marketing phenomena (Hewege, 2013). In particular, this study adopts a realism paradigm,
which considers the external reality of the marketplace and acknowledges the need to
investigate complex marketplaces using in-depth, qualitative research methods (Sobh & Perry,
2006). The digital advertising landscape is extremely dynamic, and practitioners often lead the
latest developments, so this study uses in-depth interviews with senior practitioners to reflect
on the factors included in the native advertising research framework (Figure 2.1).

2.3.1 Participants
In line with a realism approach, we selected the participants using interactive sampling.
That is, the first participants came from an expert content marketing group, identified on the
basis of their experience in the digital landscape. These senior executives provided referrals to
other “best practice” practitioners, in a snowball approach. To capture the full scope of insights,
we selected 22 participants who worked for a broad range of advertisers (12), media agencies
(6), and publishing companies (4), as Table 2.1 details. Participants who work for advertisers
also represent major brands from different product categories, company types, and firm sizes;
this variety justifies the relatively greater number of participants from advertising brands. The
agency representatives include experts from four digital marketing agencies, a content
marketing agency, and a communication agency.
Finally, the participants from publishing firms include experts from two multi-platform
publishing companies, one large digital platform, and a traditional print publisher that operates
a successful digital platform. All four publishers offer digital native advertising options on their
platforms.
28 ⎪Chapter 2

Table 2.1: Overview of participants.

Participant (P) Position Sector Scope

Advertising brands
1 Brand manager Charity Netherlands
2 Online marketing manager Electronics Benelux
3 Brand manager Skincare Benelux
4 Online marketing manager Food Chain Benelux
5 Online brand manager Music industry Benelux
6 Online marketing manager Bike components Europe
7 Online marketing manager Cycling Europe
8 Online marketing manager Telecommunication Netherlands
9 Online marketing manager Insurances Netherlands
10 Brand manager Entertainment World
11 Online marketing manager E-commerce Benelux
12 Online marketing manager E-commerce Benelux
Media Agencies
13 Strategy director Communication agency Netherlands
14 Strategy director Content marketing agency Netherlands
15 Online marketing Manager Digital marketing agency World
16 Strategy director Digital marketing agency Netherlands
17 Communication director Digital marketing agency Benelux
18 Strategy director Digital marketing agency Netherlands
Publishing companies
19 Digital Manager Publisher Benelux
20 Director Online publisher (multi- Benelux
platform)
21 Brand manager Online publisher (single Benelux
platform)
22 Manager branded advertising Online publisher (multi- Benelux
platform)
 Native Advertising: Effective, Deceptive, or Both? ⎪ 29

2.3.2 Interview process and analysis

Before each interview, the participants were briefly informed, via email, about its
general purpose. These interviews were conducted face-to-face, in a setting chosen by the
participant—mainly at their workplaces.
After some introductory, general questions about digital native advertising, the
interview questions asked participants to describe an advertising strategy decision in a recent
campaign that included native advertising. The research framework provided the interview
guide, which helped ensure that all relevant issues were systematically covered and enhanced
the consistency of the data collection (Ritchie et al., 2013). The interviews took between 50 and
100 minutes each. After the interviews, participants received a small gift, for their cooperation
and time. To ensure accuracy, the interviews were digitally recorded and transcribed verbatim.
The data analysis involved three phases: data reduction, data display, and conclusion
formulation and verification (Miles & Huberman, 1994). To assign the data reduction codes to
the transcripts, we used AtlasTi coding software, which facilitated a systematic comparison of
the results and interpretations from the data. Furthermore, it supported the categorization of the
coded data, according to the three respondent types.
The findings thus are based on shared insights retrieved from these interviews. We use
individual quotes in the following sections to exemplify the findings. The experience and
insights of these industry experts also provide keystones for empirical research into digital
native advertising, in line with the aim of realism research to generalize initial findings into
theoretical propositions (Yin, 1989; see also Sobh & Perry, 2006).

2.4 Results
Consistent with the native advertising research framework in Table 1, the findings
pertain to three topic areas: decisions about the implementation of specific content and context
factors and views on the effectiveness of digital native advertising. Each subsection concludes
with propositions to guide further research in that area.

2.4.1 Content factors

Brand prominence
Practitioners consider digital native advertising a subtle form of advertising, highly
integrated in its context, developed in close collaboration with the digital publisher, and
designed to convey relevant brand stories to audiences. In some cases, particularly for the large
30 ⎪Chapter 2

advertisers, top management still relies heavily on above-the-line advertising activities and is
uncomfortable investing in advertising in which the brand is not prominent, based on the sense
that advertising is primarily about communicating the brand.
Some stated expectations indicate that it is only a matter of time before these top managers
embrace digital branded content and native advertising though. Brand prominence remains a
complex question, and the appropriate level to achieve in native advertising is still difficult to
determine. After experimenting with various levels of brand prominence in digital native
advertising content, one communication manager of a food chain concluded:
We really pushed the limits of brand prominence and tested the levels of brand
connection by the audience and realized that we had to go back to communicate the
brand more prominently (Participant 4).
Insufficient transparency about the sender, created by a low level of brand prominence in digital
native advertising content, also may have unfavorable consequences for the digital content and
the distributing platform or publisher. For example, if the audience feels tricked into believing
they were reading editorial content instead of commercial content, they might develop negative
attitudes toward both the content and the publisher. A representative of a large digital news
platform thus noted:
We are genuinely transparent; we feel it is important that it is evident that native
advertising is clearly originated from advertisers. I think that when native advertising
is fully integrated as if it was editorial content you fool the audience; this is something
you also read in the comments beneath content that in a later stage appears to be
sponsored, and we want to avoid that negative engagement (Participant 20).
Practitioners also believe that the audience appreciates digital native content that is well
executed and offers quality similar to that of the regular editorial content. As the CEO of a
digital multiplatform publisher emphasizes, “Native content needs to have a natural fit with and
similarity to the editorial content you supply as a platform” (Participant 20). In such cases,
confronting such content does not evoke negative effects, because the audience experiences the
content as added value, as the following quotes highlight:
If the audience likes the content and it is designed properly, then it doesn’t matter where
it came from; however, transparency of the sender is important (Participant 18).
If the native advertising content is developed properly, it is only beneficial for the brand
to be transparent about their role as sender of the content (Participant 17).
 Native Advertising: Effective, Deceptive, or Both? ⎪ 31

To create recognition and recall, the brand must be linked, quickly and unquestionably,
to the digital native advertising content in audiences’ minds. Although clear brand prominence
is essential to create marketing effects and avoid negative evaluations, the most effective level
of brand prominence is not certain. We thus derive three propositions with regard to the
prominence of the brand in digital native advertising content:
P1: An intermediate level of brand prominence in digital native advertising content is
optimal.
P2: Low brand prominence in digital native advertising content negatively affects
evaluations of the advertised brand and the hosting publisher or platform.
P3: Evaluations of digital native advertising content that is highly congruent with editorial
content are equivalent to evaluations of the editorial content.

Message appeal.
Although both emotional and informational messages can be conveyed through digital native
advertising, most practitioners consider emotional messages especially effective. They also
note that, during the customer decision journey, informational content becomes more effective
in closer proximity to the actual purchase decision. That is, consumers appear more receptive
to emotional content in the brand awareness and preference phases, but then factual information
helps them convert to a purchase. Yet our respondents also recognized clearly that the preferred
message appeal depends on the target group and the product category. In some cases, different
message types serve to appeal to various target audiences for the same product, as the following
statement suggests:
It depends on your target group: ‘techies’ value highly informational content, whereas
other target groups value experiential content by seeing how the products fit their
lifestyle (Participant 2).
Therefore, in terms of the effectiveness of the type of message,
P4: The effectiveness of the message appeal in digital native advertising depends on the (a)
stage in the customer journey, (b) target audience, and (c) product category.

2.4.2 Context
The digital native advertising context consists of the device, the platform, and its
content. First, consumers choose which device to use for specific digital tasks and content
consumption, which depends on both the situation and the task. Second, consumers select their
32 ⎪Chapter 2

preferred digital platform, whether an external platform such as publisher websites or

personalized platforms such as their own pages on Facebook or Flipboard.

Device
The penetration of mobile devices and wearables affects brands’ advertising strategies.
The shift of customers toward mobile devices makes it challenging to convey advertising
messages; for example, how can they design effective banners for the small advertising space
available on a smartphone? According to our practitioner interviewees, native advertising,
unlike other types of digital advertising, should work better on mobile devices, especially
considering the minimal distraction associated with other commercial content on these smaller
screens, as the following quote details:
Native advertising proved especially successful on tablets such as the iPad. Since you
only have one screen and you can’t go anywhere. The only way to leave the screen is to
press the home button for instance to open a new app. (Participant 15).
Therefore, we propose:
P5: In the context of mobile devices, native advertising is more effective than other types
of advertising.

Platform
Choosing the right digital platform is key to the effectiveness of native advertising.
Practitioners accordingly emphasize the importance of contextual relevance and fit for the
effectiveness of digital native advertising content. In the complex, modern digital native
advertising landscape, a good fit between an advertised brand and the distribution platform
requires that the content and platform reinforce each other and create synergetic effects. For
advertisers, choosing the best platform for digital native advertising activities is increasingly
complex.
First, the supply of platforms with native advertising options is rapidly increasing. Many
companies that traditionally based their business models on trading products through their
digital platforms are extending their activities into services that previously might have been
offered exclusively by publishers, such as the distribution of branded content.
These e-commerce platforms increasingly provide editorial content together with branded
content, including digital native advertising options.
 Native Advertising: Effective, Deceptive, or Both? ⎪ 33

Second, new services, such as live-streaming platforms (e.g., Live.ly) are likely to offer
advertising options in the near future. Our practitioners anticipate that native advertising content
will fit these new platforms better than other types of advertising, because audiences tend to
feel connected to the streaming party and value its endorsements.
They predict that the functions will follow the principles that inform vlogger platforms,
on which vloggers advocate a brand purposively and in a well-integrated manner. More
prominent advertising types instead might interrupt the audience’s viewing experience.
Still, debate continues regarding whether digital native advertising is suitable for all
types of platforms.
Native advertising has the look and feel of editorial content, so news platforms might
be less suitable, because audiences expect objective views from these platforms, whereas
objectivity is less important for entertainment platforms. The interview participants from the
agencies and online publisher emphasized in particular that digital native advertising options
on news platforms can challenge the credibility of these platforms. As emphasized by the online
publisher, who cautioned that news platforms must be careful to consider their societal
responsibility,
It is something different if you say these pants are nice [versus when] you write a piece
about the downfall of Greece from the sender Goldman Sachs (Participant 17).
Therefore, we propose:
P6: Native advertising is more effective than other types of advertising for creating
marketing communication effects on live-streaming platforms.
P7: Native advertising content on news platforms affects the credibility of the platform more
negatively than does native advertising on entertainment platforms.

Other platform content

The practitioners confirm that the media context results from the other content on a
platform too. However, respondents from both advertisers and agencies assert that the
contextual relevance of social platforms depends particularly on the selection of potential
customer profiles, based on their personal interests, for advertising purposes. As a
representative of a digital media agency explained:
We know from Facebook that in our area 700,000 users indicated they ‘like to drink
beer.’ This provides us with contextual relevance. We can target these users and
distribute our message about beer to this beer-drinking audience. So, context is a multi-
interpretable concept.
34 ⎪Chapter 2

On a recipe platform for instance, I can search by recipes but also by ingredients that
are used in these recipes. This information could also be used to determine relevance
for the advertising content (Participant 17).
These detailed consumer data provide input for dynamic designs of platforms and content too,
such that the content on platforms can be altered to match individual interests and behaviors,
resulting in personalized platforms. As a participant from an e-commerce company explained:
We are currently developing the back-end of our platform in such a way that all our
data streams are used to service you with the website you want. If you bought a laptop
last week, then you are most likely not searching for a laptop, so we will offer you
accessories, a manual, or advice. This would give you the feeling: yes, this is my
platform and that’s why I shop here (Participant 12).
Because this audience increasingly finds relevant, valued content through their personal emails
and social media channels, they consume content there, instead of visiting publishers’
platforms. Participants from the agencies regard this development as a threat to traditional
advertising-based business models for publishers.
The increasing use of platforms such as Flipboard, which allow users to personalize
their content streams to include specific articles from publishers or blogs, appears likely to
speed up these changes. Advertisers thus should be present where consumers are, instead of
trying to force them to visit their existing platforms, as recommended by the brand manager of
a large cosmetics brand:
Advertisers are searching for channels to distribute their content while consumers find
their own channels with their personal desired content. As an advertiser it is important
to find the touch point with the audience, which means being present in the customer
journey itself instead of taking them to a different place (Participant 3).
In contrast, the publishers we interviewed believe that their expertise and connections with their
audiences will keep their advertising-based business model sustainable.
The creation of valued digital native advertising content that is worth sharing with others
may be even more important; shared content sometimes is the only way an advertiser can enter
consumers’ personalized contexts. Digital native advertising content therefore is widely
perceived as an effective tool for creating expanded reach in new contexts. However, the gap
between older and younger generations with regard to their adoption of digital techniques and
platforms also requires consideration. Compared with older audiences, younger consumers
strongly prefer video and animated content and consume content in more personalized
platforms. Therefore, according to the practitioners:
 Native Advertising: Effective, Deceptive, or Both? ⎪ 35

P8: Native advertising is a more effective tool for reaching audiences in personalized
advertising contexts than traditional forms of online advertising, especially among
younger audiences.

2.4.3 Effectiveness
Overall, the participants in our study acknowledge digital native advertising as an
effective advertising tool. Advertisers predict that they will continue to assign more of their
budgets to this type of advertising, which they regard as an effective instrument to build
relationships with target audiences.
Intermediate effects
The flexibility of digital native advertising content, as well as its technological capabilities (e.g.,
retargeting), means that digital native advertising has the potential to create advertising effects
throughout customers’ entire decision journey. However, current digital native advertising
activities primarily seek to create intermediate effects in the early stages of customers’ journeys,
such as awareness, interest, and attitude change.
According to the participants in our study, it offers great effectiveness for creating so-called
brand effects:
I would like to have more native advertising in our publications as it is really
interesting; it is noticeable that it has a very positive effect on the advertising brands
(Participant 19)
To determine the effectiveness of digital native advertising, some campaigns rely on traditional
tests that measure changes in consumers’ recognition and attitude. However, these tests require
substantial budgets and thus typically are conducted only by large advertisers:
We conduct less 0-1 tests for our customers than we would like, because of the high
costs involved (Participant 14)
Instead, advertisers turn more to A/B tests to evaluate various digital native advertisements. To
determine the effectiveness of digital native advertising, some agencies also work with brand
trackers that measure online buzz about the advertised brand, or else they use alternative
evaluation tools, such as net promoter scores. Concrete evidence about the relation between
these measures and the actual return on the brand’s investments in digital native advertising is
still lacking.
36 ⎪Chapter 2

Behavioral effects
Compared with measures for native advertising in offline media, behavioral effects can be
measured relatively easily online and included in the advertising goals for digital native
advertising. Models that reflect the cost per view, cost per click, or cost per thousand can reveal
the costs and evaluate the effectiveness of digital native advertising, depending on the platform
or client demand.
Interaction with the content, through comments, time viewed, percentage of content viewed (or
not), number of (unique) reached people, and sharing, also can be reported.
Although engagement, in the form of commenting and sharing, tends to be more important than
clicks, online publishers do not always include engagement metrics in their campaign
evaluations. The effectiveness of native advertising content also might be derived according to
conversions to other platforms, visits to a web shop, or the use of refund codes. Despite an
unclear connection between engagement levels and actual sales, more activity around the brand
or product often is registered in response to digital native advertising activities, as one
participant explains:
We connect engagement on a platform to activities outside the platform. Was a buzz
created? Did we turn up in search results? How many sales are derived and so on.
Based on that, we do see that native advertising works (Participant 5).
Although many participants from advertising brands fail to use these technological options,
retargeting technology enables them to track digital native content, so they can push customers
to the next stage in their decision journey, until conversion takes place. Tracking data also allow
the identification of steps that consumers take before actual conversion, such as moving from
Google searches to web shops or conversion, as illustrated by the experience of an e-commerce
company:
All marketing instruments are attached to a specific attribution model. We know that if
someone searches for a specific product, a considerable chance of conversion in a
considerable timeframe exists. We also know that when people like us on Facebook, the
conversion rate in the next period is higher. In this situation, in these stages, it is
especially effective to be present with branded content (Participant 10).
Currently though, digital native advertising seems less suitable for creating the ultimate
conversion to a purchase. The integration of new technologies, such as Google Wallet and
Apple Pay, make conversion a more realistic goal for future digital native advertising, as
explained by another participant:
 Native Advertising: Effective, Deceptive, or Both? ⎪ 37

Payment systems are increasingly integrated in operating systems and in apps. This
development increases the possibility to create transactions literally from content. So
these technical developments help to achieve conversion-related goals eventually
(Participant 21).
On the basis of the practitioners’ perceptions, we offer the following propositions:
P9: Digital native advertising is an effective tool for creating intermediate effects, such as
awareness and attitude change.
P10: Digital native advertising is an effective tool for creating electronic word of mouth.

2.5 Conclusion & Discussion

The aim of this study has been to provide insights into content and context decisions
that determine digital native advertising effectiveness, as well as the perceived effectiveness of
such tactics, according to actual practitioners. This section synthesizes the results to define
directions for further research, as well as some limitations of this study.

2.5.1 Digital native advertising content

Findings from existing literature on advertising in general do not automatically hold for
native advertising, due to its specific characteristics. In particular, a common theme in our
propositions, which reflect insights from practitioners, refers to the consequences of the close
similarity between native advertising content and editorial content. An important discussion
surrounds the potentially deceptive nature of digital native advertising, which arises due to the
inherent lack of brand prominence, was frequently mentioned during the interviews. Persuasion
knowledge theory predicts that prominent branding in advertisements might lead to more
negative consumer evaluations (Van Reijmersdal, 2009), but the practitioners in our study
undisputedly recommend more prominence for brands in digital native advertising content, as
a precondition of positive evaluations. When executed properly, the added value of digital
native advertising content on a platform can drive its effectiveness. Even though the
practitioners assert that their digital native advertising content is transparent, it remains
important to examine the circumstances in which consumers agree, because research also shows
that digital native advertising is often not recognized by audiences (Tutaj & Van Reijmersdal,
2012; Wojdynski & Evans, 2016). The optimal level of brand prominence in digital native
advertising remains unclear, so further research on this topic is encouraged. If an audience
experiences feeling of deception due to the low brand prominence, it harms both the brand and
38 ⎪Chapter 2

the hosting platform. In line with this observation, practitioners indicate that forward spill-over
effects, as identified in offline advertising contexts (de Pelsmacker et al., 2002; Van
Reijmersdal et al., 2005), also hold for digital native advertising. However, because digital
native advertising is perceived as less suitable for news platforms, platform type seems to
constitute a moderator. Additional research could determine how and in which circumstances
evaluations of digital native advertising content spill over to the distributing digital platform.
According to the practitioners, the effectiveness of appeal type also depends on the stage
of the customer journey; they anticipate that an emotional appeal is more effective during
interactions with the customer in the early stages of their journey, but informational messages
are more effective farther along the journey, just before conversion takes place. This finding
needs to be interpreted with care, because the effectiveness of the appeal type is strongly
moderated by product type and target audience characteristics.
Yet in this finding, the practitioners corroborate previous research about the moderating effect
of consumer characteristics on the effectiveness of a chosen message’s appeal (Johar & Sirgy,
1991). These moderators also might explain the mixed results from prior studies, regarding the
effect of appeal type on online engagement measures ( Golan & Zaidner, 2008; Berger &
Milkman, 2012; Ashley & Tuten, 2015). Consumer-based research into the message appeals of
digital native advertising content therefore is recommended.

2.5.2 Digital native advertising context

This study furnishes insights into the current dynamics of advertising contexts and their
impacts on the device and platform levels, as well as their relationship with the surrounding
content, from practitioners’ perspectives. Another common theme across the resulting
propositions pertains to the perceived effectiveness of digital native advertising in such
dynamic media contexts. In particular, its effectiveness for conveying messages on small
devices should be investigated further, especially as the uses of mobile devices continue to
increase. This dynamic advertising landscape appears likely to persist, featuring continuous
introductions of new channel types, such as live-streaming platforms, personalized information
streams, and technological options that can personalize platform contexts. Advertisers that hope
to select the most effective advertising context for their marketing communication activities,
including digital native advertising, will face increasing complexity. The results of this study
indicate that practitioners believe that the characteristics of digital native advertising content
and its perceived value for the audience make it an efficacious tool to induce advertising effects
in these new advertising contexts. However, contextual relevance is a key determinant.
 Native Advertising: Effective, Deceptive, or Both? ⎪ 39

Congruent native advertising content that mirrors the regular content of the platform and feels
authentic could limit consumers’ perceptions of advertising intrusiveness.
The increasing consumption of such content within personal consumption contexts, such as
Flipboard, may jeopardize the sustainability of some current business models, because
consumers have less need or desire to visit professional publishing platforms to gain access to
valuable content. The discussion of these changing advertising contexts also highlights
practitioners’ recognition of the growing gaps in the media consumption behaviors of younger
versus older generations.

2.5.3 Effectiveness
With regard to the perceived effectiveness of digital native advertising, the results of
our interviews are largely in line with previous findings about the effectiveness of digital
advertising forms (Tutaj & Van Reijmersdal, 2012): due to the perceived relevance of the
content for the audience, practitioners believe that digital native advertising content is a good
solution to consumers’ perceptions of digital advertising as intrusive. Further research should
confirm this potential benefit. Advertisers use digital native advertising to create advertising
effects that are increasingly difficult to achieve with other types of advertising, due to
consumers’ changing media consumption behavior. In this study, the practitioners endorse the
strong, positive, intermediate effects of digital native advertising on audience attitudes and
awareness, compared with other types of digital advertising.
Furthermore, they regard digital native advertising as a suitable form of marketing
communication for any target audience but especially for younger customers, due to the greater
penetration of digital devices, channels, and platforms among this group. Studies of the
effectiveness of digital native advertising thus should control for age.
Previous studies that propose that branded content leads to positive consumer responses
in a digital context mainly compare branded content with traditional banner advertising
(Becker-Olsen, 2003; Van Reijmersdal et al., 2009). These two types of advertising might not
be comparable; they are designed and executed to achieve different effects in various stages of
the customers’ journey (i.e., banner advertising aims to create short-term, behavioral effects
such as CTR; digital native advertising is mainly used to create intermediate effects such as
branding in early stages of the customer journey). Additional research that includes a
comparison of digital native advertising with editorial content, extending Wojdynski & Evans's
(2016) contributions, could offer new insights into the value of digital native advertising
content.
40 ⎪Chapter 2

In line with Truong et al. (2010) findings about developments in the digital advertising
market, the practitioners in our study agree that it is difficult to assess returns on investments.
To evaluate the effectiveness of digital native advertising in terms of its intermediate effects,
practitioners still tend to rely on panel-based campaign evaluations, though it is more difficult
to find sufficient groups of respondents who actually encounter the focal content. In terms of
behavioral effects, engagement measures such as CTRs and interactions create some insights,
but the precise relation of digital native advertising to specific outcomes remains unclear and
demands further investigation.
In conclusion, this study offers 10 propositions that are based on practitioners’
perspectives. Together, these propositions establish a research agenda for digital native
advertising. Quantitative research projects will be necessary to identify the impact of these
content and context variables on effectiveness measures for digital native advertising.

2.6 Limitations
The qualitative methodology for this study creates some limitations. As with all
exploratory qualitative research, the sample size is relatively small. Care should therefore be
taken in generalizing the findings beyond the participants involved. Although all the interviews
followed the same guidelines, some risk remains that participants could have been influenced
by the in-depth interviews. The findings also reflect the perceptions of participants who work
for firms located in the Netherlands. Still, 15 of the 22 participants work for companies that
also operate outside of the Netherlands, and two companies operate globally. The findings also
are largely consistent across interviews, even though the participants represent a wide variety
of brands and companies. Furthermore, market developments are highly consistent across
Western countries; for example, Bughin et al. (2016) indicates in the McKinsey Global
Institute’s Industry Digitization Index, which reveals the degree to which digitization drives
sectors and firms, that the Netherlands is comparable to other Western nations and is second
only to the United Kingdom in Europe in terms of its digitization index. The 2016 Digital
Yearbook (Kemp, 2016) also indicates comparable penetration rates for the Netherlands, such
that it hosts 95% active Internet users, compared to 87% in the United States, and 56%
penetration of active social media users, compared to 59% in the United States. Accordingly,
the findings seem likely to hold for other regions in which the Internet provides an important
advertising medium.