Mike Harty, PowerLinks co-founder and ExchangeWire columnist, accepts the need for regulation in the native advertising space, but argues that a line must be drawn somewhere to maintain the unique value of the offering.

Last month, the AOP, IAB, ISBA (representing publishers, ad tech firms, and brands respectively) issued guidelines on how to label native ad formats to their constituents, bringing the practice in line with the Advertising Standards Authority’s (ASA) CAP code.

The UK trade bodies advise that advertisers and publishers clearly demarcate between native advertising and a title’s editorial content using visual markers, plus wording such as ‘paid promotion’, or ‘brought to you by...’. So far, so good.

A more detailed account of the guidelines can be viewed here, and advice from the IAB’s US counterpart can also be read here.

The need for such guidance is clear when you consider that recent research demonstrated that one-in-five UK internet users had mistaken native ad formats for actual editorial coverage.

However, what is abundantly clear is that both advertisers and publishers are heavily adopting Native. According to the IAB, spend hit £216m in the first half of 2014. Furthermore according to AOP figures, publishers have now identified Native as their principal new business opportunity. Combined, this shows the rapidly growing appetite and opportunity in Native from both buyers and sellers.

As an industry, we need to agree on rules so that Native ad formats/placements are not misleading and actually add value to a reader’s experience. Beyond the moral necessity of informing consumers on what is commercial content, this allows us to deliver Native's core value proposition at scale. Native should deliver end-user value, not detract from it.

Programmatic Native will benefit from the scale enabled by standardisation. However, what I would point out, is that we need to be mindful of not over-regulating the format, otherwise we stand to lose the value of the nature of the placement. We simply cannot end up with a scenario where all native ad formats look the same.

At its core, native is about unique ad executions that are tightly integrated into the host environment. In a premium editorial environment, a native ad unit has to mirror the wire-frame of that site, and the second we start trying to impose too many guidelines, then we’re in danger of regressing this opportunity.

What is now clear is that native programmatic has arrived. Therefore, the challenge becomes delivering the value proposition of native at huge scale, whilst maintaining the inherent value of super-customised placements and executions, whilst also implementing an element of standardisation.

We can’t just take the rules of display and then apply them to native. Native and display ads are fundamentally different, and thus require their own rulebook. If banners were agents of disruption - intended to juxtapose themselves from the webpage - native stands for a more integrated added-value approach to advertising and user experience.

Native advertising is an opportunity to rewrite the playbook around all of that. It’s a chance to say: ‘If we want digital advertising to work optimally, we need to figure out ways to add value to the user experience.’

The online advertising industry is encountering the rapid rise of ad blocking software, and I believe that native, executed optimally, can help combat this issue. When using the right audience and contextual data to serve a reader with relevant sponsored content (that doesn’t look like any old ad that was copied and pasted from just about anywhere on the internet) you're infinitely less likely to incur the wrath of the ad blockers. Ultimately, why would you want to block content - paid or otherwise - which genuinely adds value to what you're reading?

For instance, if a user is on a health website researching fitness regimes, and is then served with a native ad unit containing content which adds value to their research, then they're more likely to engage with the placement. For example, the native advertising unit could demonstrate how a product like protein powder could be used as part of a balanced diet. Whereas a banner may flash the message 'buy me', the native unit attempts to illustrate how the user could incorporate the product into their lifestyle. This demonstrates the core difference between what native stands for compared to display.

Programmatic Native ads need to be able to adapt to the audience and the context of what the audience is reading, and they're now able to do so by leveraging the advanced technology designed around the display advertising space.

If we as an industry identify the fine line between regulation, unique creativity, and data-led targeting then we can serve sponsored content that users find just as valuable as the editorial content they’re proactively seeking.