Native Ads vs. Display Ads: Major Differences and When to Use Each

Since we launched StackAdapt, native advertising has gone from a shiny new advertising strategy to a common channel in most marketers’ media plans. 

In 2025, native programmatic display ad spending in the US is forecasted to reach $116.76 billion USD. While most marketers have embraced the concept of native advertising, and it continues to experience consistent double-digit growth year-after-year, not enough see it for what it actually is—a powerful, versatile method for communicating your brand’s message online. 

Let’s take a look at the role of native ads vs. display ads and when to use each.

Native Ads vs. Display Ads

To better understand their differences, it helps to think of native ads vs. display ads as “new school vs. old school.” 

Display ads are sort of the “old guard” of the internet. The first one was published by AT&T back in 1994 on WIRED magazine’s then-brand-new website. It cost $30,000 USD and had a mind-boggling 44% click-through rate (CTR).

These ads, which most of us know as banner ads, are usually brightly-coloured, contained independent branding consistent with the company displayed, and existed in stark contrast to the website they were served on. While they used to be a primary marketing medium, they now tend to be used as part of a larger multi-channel strategy. 

Enter what was once the “new kid on the block”: native advertising. Although new channels like connected TV (CTV) have since arrived, native is still viewed as the main contender to display.

The Differences Between Native Ads and Display Ads

While many things separate native ads from display ads, the biggest difference is their look and feel. 

Display ads are designed to look like banners that stand out. Their colour, placement, and branding contrast the website they’re delivered on and are meant to “pop out” at the user.

Native, on the other hand, is intentionally designed to blend in seamlessly with the platform where they’re served, whether it’s a social media platform like TikTok or the homepage of a major news site. When done right, users feel like they’re consuming content and not interacting with an ad at all.

Here’s a quick comparison of the major ways native and display advertising differ:

Native Ads	Display Ads
Traditionally static with images and text.	Include images, text, and animations, and can be interactive.
Appear as recommended, sponsored or branded content.	Vary in shape and size to fit in different locations on a web page.
Blend seamlessly into site content, matching the look, form, and feel of the media format that they appear in.	Visually stand out, and it’s clear they’re promoting something.
A great solution for educating your audience by conveying information and answers that they might be looking for.	A great solution for raising awareness of a brand, product or service.

Many advertisers opt for native vs. display ads to take advantage of the benefits of native ads, such as their higher engagement rates and seamless integration with existing content. However, display ads still have their place. Knowing when and how to use each format is a critical part of your overall marketing strategy because, together, these formats can drive strong performance.

When Should You Use Display Advertising 

Display advertising is a great channel if you want to increase your campaign reach. Here are a few scenarios where display advertising is effective:

Improving Brand Awareness

If your brand or your client’s brands are struggling currently with brand awareness and are looking to increase visibility, display ads may be just the thing. You’ll be able to get your ad in front of a large audience, and the bold, contrasting nature of the ads will give a strong first impression to target customers.

Making a Visual Impact

Products that are highly visual, like ebooks, certain consumer goods, and online coupons, can benefit from an effective display ad campaign. Display ads also work well with consumer products that don’t require much additional storytelling or explanations.

Reaching a Niche Audience

If the product or service you’re marketing serves a much smaller target audience, display ads can be a perfect solution. Providers of these ads will usually let you segment your audience by interest, which can lower costs and ensure your brand gets in front of your ideal customers.

Retargeting Previous Site Visitors

If users have already interacted with your brand in some way, display ads can be a great tool as part of your overall retargeting strategy. Examples would be retargeting an online shopper with an abandoned cart or showing a display ad for an ebook to a user who already read one of your blog posts.

In general, the best way to use display ads is to leverage bold images, colours, and interactive elements to grab a user’s attention quickly and get them to click.

When Should You Use Native Advertising 

You should use native advertising if your goal is to have a user perform a certain action after clicking on an ad. For example, read a piece of content on your blog, sign up for something, or make a purchase.

Here are a few more specific scenarios when programmatic native could come in handy:

Advertising on a Tight Budget

When you look at display vs. native ads, native advertising is much more cost-effective because the CTR is often higher. Since ads are typically purchased on a cost per thousand (CPM) basis, the higher amount of clickthroughs can drive down your cost per click (CPC). With conversion rates held equal, the cost-per-action, whether it’s getting a user to spend time reading content or to complete a form, will also be lower.

Easier Campaign Attribution and Accountability

Campaign performance tracking and accountability are made a lot easier with native ads because conversions are usually (and are recommended to be) measured only after the click.

Take a common setup that our clients run:

• Step 1: Target a user with a native ad.
• Step 2: Drive them to blog content.
• Step 3: Retarget the individual with a display ad driving them to a landing page or homepage to complete a conversion.

Native’s focus on post-impression conversions provides more hard evidence of performance and effectiveness than a traditional display advertising campaign. Since native reporting and tracking revolves around the post-click experience, it’s easier to produce concrete results for your clients.

Amplifying Brand Content

Over the years, search engine optimization has become difficult because it takes a long time for content to get indexed and move up the rankings. Meanwhile, social platforms like Facebook, Instagram, and X continue to have declining organic reach and fluctuating ad costs, forcing advertisers to look toward other channels. As a result, native advertising has emerged to address the need to amplify brand content on demand, helping advertisers reach their target audience more efficiently.

Moving Beyond Traditional Content Marketing

While traditional content marketing is a powerful tool for any digital strategy, it’s very easy to get “tunnel vision” and see content as the only way to educate and engage customers. But native advertising can be used to diversify your strategy by seamlessly integrating promotional content into platforms and websites your audience already engages with, providing advertisers with a more natural and less intrusive way to capture attention and drive conversions.

Deciding Between Native Vs. Display Ads

If you’re considering whether to use native ads vs. display ads for a campaign, ask yourself about your main goals:

Use display ads if your goal is:	Use native ads if your goal is:
Impressions	Clicks or high CTRs
Unique reach	Site visitors or increased time-on-site
Brand awareness	Signups, conversions or sales

The way customers interact with your clients’ brands is evolving every day. With an increased focus on the customer journey, it’s important to use a variety of channels to reach your goals, and that includes native and display advertising. 

Ultimately, both native ads and display ads serve as valuable tools to complement your overall marketing strategy and should be used as part of a larger multi-channel strategy employing video, CTV, audio, in-game, and digital out-of-home (DOOH) advertising to maximize marketing performance.

Want to learn more? Watch this webinar for more info on how to run successful display and native ads campaigns, and request a demo to learn more about StackAdapt.

Native vs. Display Advertising FAQs