If you don’t know what native advertising is, you’re not alone. According to Copyblogger’s 2014 State of Native Advertising Report, close to three-quarters of those surveyed (mostly marketers) are not familiar with the term.

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Native advertising is hot right now, though the term itself is obscure. Back in the day, we called native advertising “advertorial”: paid content that fit almost seamlessly into an editorial environment, including newspapers, magazines, TV programs, and radio broadcasts.

Today, native advertising takes many forms and goes by a number of terms, including “sponsored content,” “featured posts,” or “promoted content,” which contributes to the confusion.

You’ll find examples of native advertising almost everywhere. BuzzFeed uses sponsored content as its primary source of revenue, such as this sponsored story from Charmin: “14 Things We’d Only Read in the Bathroom.”

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Late last year, Will Ferrell undertook an unusual marketing effort to promote his film, “Anchorman 2: The Legend Continues,” by posing as his character, Ron Burgundy, to read TV newscasts from stations across the country.

A more traditional form of native advertising is this Forbes article sponsored by Capital One.

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Why Media and Brands Are Embracing Native Advertising Now

A number of trends are contributing to the rising popularity of native ads. Publishers are scrambling to compensate for declining advertising and subscription revenue by finding new sources of paid advertising. Click-through rates are also declining, especially with the popularity of smartphones and mobile news consumption.

Brands are telling their own stories on blogs and social platforms, providing useful information to educate and entertain both prospects and customers. Many struggle to attract and keep an audience, and native advertising helps them reach new readers and viewers by piggybacking on the audience built by legacy media and popular websites.

People read the news on social networks, especially Facebook and Twitter, where the latest Internet memes appear adjacent to breaking news from The Globe and Mail and other respected news outlets. Facebook Promoted Posts are mixed in with organic posts. Sponsored Tweets appear in users’ Twitter feeds. And when you search on Google, ads appear beside, above, and below organic search results.

People are growing increasingly comfortable reading different types of content in one place. Why not read sponsored content that appears in mainstream media?

Native Advertising’s Ethical Challenge

While native advertising is popular, it presents an ethical challenge. Consumers can easily confuse a sponsored ad with editorial, particularly if the two have a similar look and feel. Yet the two pieces of content are very different. A brand subsidizes the sponsored ad using a commercial message, while a trained, objective journalist writes the editorial.

The U.S. Federal Trade Commission organized a native advertising workshop last fall to decide whether it should provide additional guidance for advertisers and publishers. The FTC’s conclusion was inconclusive, and officials said they would have to think about next steps.

In Canada, the situation is similar. Government bodies have not issued guidelines specific to native advertising.

Despite this lack of guidance, brands and publishers need to follow common sense when using native ads. Here are five suggestions to help you navigate the murky waters of sponsored content.

1. Insist on transparency

No one wants to feel duped when they mistake advertorial content for editorial. To avoid angering your audience, transparency is critical when it comes to native advertising.

Many newspapers and magazines use different fonts and other visual cues to differentiate native ads from editorial content. Language cues are another best practice. There are lots of options, including using words such as “promoted,” “sponsored,” “presented by,” “ad,” “advertisement,” “featured,” “suggested,” and more.

To keep it simple, the Interactive Advertising Bureau offers this advice: “A reasonable consumer should be able to distinguish between what is a paid native advertising unit versus what is publisher editorial content.”

2. Provide value to the audience

Promoted content should always provide value to the audience. While “value” is subjective and open to interpretation, avoid overly promotional and direct sales messages. Strive to educate, inform, or entertain while weaving your brand message subtly into the content.

3. Avoid native ads targeting children

Remember when you watched cartoons on Saturday morning? Sometimes the ads looked just like the show — especially when animated characters such as Tony the Tiger appeared on screen, telling you Frosted Flakes tasted “gr-r-reat!”

Since kids are less likely to distinguish between advertising and regular content, avoid sponsored ads in children’s publications and websites.

4. Ensure the content fits the brand and the publisher

Native ads work best when the content is consistent with a brand’s personality, as well as the publisher’s editorial mandate.

Consider Charmin’s BuzzFeed example above. “14 Things We’d Only Read in the Bathroom” would not be effective in a business publication such as the Financial Times, and a serious article about banking reform wouldn’t appeal to the person expecting a good laugh on BuzzFeed.

5. Provide an opportunity to participate

Good content, native and non-native, should provide an opportunity for audience participation. Brands benefit by building trust and strengthening relationships with their customers, and customers feel empowered when they can suggest product or service refinements.

Whatever you call it — sponsored, promoted, or featured content — native advertising is here to stay. When done right, it’s another way for publishers to replace disappearing (and much-needed) revenue, for marketers to build stronger rapport with their customers, and for the consumer to offer new insights to help brands improve their products.

If you need help planning advertorial, editorial or sponsored content, get in touch to learn about our content marketing services.