American media company BuzzFeed will be rolling out display advertising that will run across its homepage, stories pages and mobile apps. The company had previously claimed banner ads were “terrible” and long focused on native advertising via content such as quizzes, videos and articles.
Now, it seems to have made a u-turn and will be selling display formats via its third-party ad tech to boost monetisation across its properties.
Jonah Peretti, CEO and Founder of BuzzFeed, explained to Business Insider:
“Tactically, programmatic has improved in terms of loading times, mobile experience, and ad quality and opens up another way for us to monetize our huge audience. The move also benefits our global strategy by allowing us to generate revenue in markets before we’ve built business teams to implement native monetization.”
BuzzFeed had been a champion of native advertising to focus on high quality content and adverts. With the move away from native the company hopes to boost profits.
Peretti adds that the addition of programmatic options essentially expands BuzzFeed’s various revenue streams. Although he declined to confirm it, the company may be preparing to go public in 2018 according to rumours.
Programmatic ads enable marketers to more effectively target their campaigns. Google and Facebook have proven time and again that this is a lucrative business.
More reasons for the move toward programmatic are the adoption of mobile devices for content consumption as well as improved banner advertising quality.
However, the transition may not be entirely risk-free. Studies have shown time and again that consumers actually prefer native ads. Research by Sharethrough/IPG Media labs found that consumers looked at native ads 52% more often than banners.
Similarly, research by IHS predicted that native ads would account for the majority of mobile advertising revenue by 2020..