Marissa Mayer: Marketers Need to Embrace Native Ads

Cannes address delivered alongside new Tumblr ads integration

CANNES, France—From magazines to TV, radio to newspapers, every medium has come to embrace native advertising.

If Yahoo can leave its past behind, then surely advertisers can too. That was, more or less, Yahoo CEO Marissa Mayer's advice to brands and advertisers attending the Cannes Lions festivities here today. And while the high-profile exec spoke to attendees on Le Croisette, her marketing team was busy spreading the word that Tumblr's native-styled Sponsored Posts were now available for placement across Yahoo's properties. On Yahoo's digital publications such as new Yahoo Beauty and Yahoo Tech, the Tumblr ads will render as image-heavy sponsored content next to news articles and other editorial posts.

Yahoo CEO Marissa Mayer Photo: Steve Jennings/WireImage

Of course, the Tumblr development strategically meshed with the central themes of Mayer's address. Specifically, she wants everyone to stop all the hand-wringing over native advertising and embrace its role as an inevitable—and highly effective—form of digital marketing.

"There's this notion of the Internet with content in the middle and stickers around the edge," Mayer told the audience at her Cannes presentation, titled "On Users, Brands and Creativity." 

While she didn't directly blame brand marketers for perpetuating this traditional advertising approach, she did dedicate a good portion of her fast-paced talk to Yahoo's success with native advertising units, which she says have consistently proven to be successful in marketing to millennials.

"Native experiences beat their traditional display counterparts in almost every metric," she said.

According to Mayer:

• Viewers of native ads are 3.6 times more likely to perform a branded search than viewers of traditional display ads.

• Viewers of native ads are six times more likely to do a related search.

• 46 percent of millennials who noticed branded content say they consumed the content.

• One-third of those millennials shared the branded content.

Yahoo has traditionally offered two kinds of native ad options: image ads and stream ads, which the network describes as ad units "naturally blending into the content streams viewed by users."

As underscored by Yahoo's Tumblr ad integration this morning, the potential for native partnerships with brands is growing rapidly thanks to the company's acquisitions of not only Tumblr but also Flickr. Yahoo investors certainly hope the social platforms—chiefly Tumblr, which cost $1 billion in May 2013—soon give Mayer's ad business a needed shot in the arm. The Sunnyvale, Calif.-based tech company's display revenue was flat at $453 million in Q1 this year after six straight quarters of year-over-year declines.

"When we acquired Tumblr a year ago," Mayer told the Cannes audience, "we saw what you probably saw: an unmatched platform for creators and curators We also saw something else: A great platform for brands."

In 2014, Yahoo's editoral portfolio has continued to grow, focused primarily on digital magazines. The network launched five titles this year alone, including the aforementioned Yahoo Beauty, which debuted yesterday. In addition to building broader audiences by becoming a high-volume content publisher, Yahoo also has access to a wide range of options for branded content on its new channels.

With many of the world's top brands in attendance at Cannes, Mayer made sure to highlight some of the marketers she feels are best embracing Yahoo offerings, namely Tumblr.

Mayer cited the following initiatives as some of her favorites:

• General Mills' "Must Be the Honey" Tumblr in the voice of Buzz the Bee.

GE's science-focused Tumblr offering what she described as "funny, interesting insights into the future."

Hyundai's #becausefutbol, fanning the flames of fans' passion for soccer.

Ford's "And Is Better" Tumblr about "times when more is more."

• Lionsgate's Capitol Couture fashion hub, set in the world of The Hunger Games. 

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