The FTC held a workshop this week, putting native advertising under the microscope with an eye towards possibly introducing new guidelines to regulate the practice.
Native ads: new name for old practice
Native advertising on the web is fairly new but the FTC has long regulated ads disguised as content under its Section 5 authority, which prohibits unfair or deceptive advertising. The first case the FTC ever brought against an ad disguised as editorial content was in 1917, against a newspaper ad for an electric vacuum cleaner. In those days the FTC classified this type of advertising as “masquer-ads.”
This week’s workshop, dubbed “Blurred Lines: Advertising or Content,” was held to determine whether publishers and advertisers were taking adequate enough steps to ensure that consumers could distinguish native ads from actual editorial content.
There was some consensus among the panelists and speakers regarding the importance of transparency and disclosure. However when it came to finding a viable solution, – be it labels, colors, or some other type of treatment – very little of use was actually forthcoming.
FTC chair Edith Ramirez best articulated the concerns that led to the workshop being held in the first place.
“While native advertising may certainly bring some benefits to consumers, it has to be done lawfully,” said Ramirez. “By presenting ads that resemble editorial content, an advertiser risks implying, deceptively, that the information comes from a non-biased source.”
“One boatload of sh*t at a time”
The workshop was attended by publishers, government representatives, and members of the ad industry who spoke out in defense of the practice, which has emerged as one of the hottest new forms of advertising on the web.
While ad people defended native advertising, representatives of the media and the government took it to task. Columnist Bob Garfield was one of the most vocal critics of the practice from the media side, not mincing words in his criticism of native ads.
“With every transaction publishers are mining and exporting a rare resource: trust,” said the former Ad Age editor at large. “Those deals will not save the media industry. They will, in a matter of years, destroy the media industry: one boatload of shit at a time.”
But ultimately, it sounds like the workshop didn’t really lead to any helpful conclusions.
“This has raised more questions than it answered,” concluded Mary Engle, FTC associate director of advertising practices.
The Native Advertising Playbook
In what’s presumably an effort to try and head off any prohibitive regulation that might be put forth by the FTC, the IBA has preemptively issued its own set of guidelines, “The Native Advertising Playbook.”
The 20-page playbook attempts to better define what native advertising is and lay out some ground rules and ethical guidelines for brands and marketers engaged in the practice.