Lately almost everyone in publishing has been talking about native advertising. Right? Well, the Federal Trade Commission wants to join in on the conversation, too.
On September 16, the FTC announced that it is holding a workshop on December 4 to "explore the blurring of digital ads with digital content." In an official release the FTC stated the following:
Increasingly, advertisements that more closely resemble the content in which they are embedded are replacing banner advertisements-graphical images that typically are rectangular in shape on publishers’ websites and mobile applications. The workshop will bring together publishing and advertising industry representatives, consumer advocates, academics, and government regulators to explore changes in how paid messages are presented to consumers and consumers’ recognition and understanding of these messages.
A conversation between the FTC, publishers, consumer advocates and academics about transparency guidelines gives native advertising the legitimacy it needs to become a new standard. What that means, however, is that publishers and advertisers have to work together to create dynamic advertorial content that is not deceptively presented as editorial.
Self-Regulation Still Rules
Some skeptics are viewing the workshop as a doomsday prophecy for native advertising, despite history showing the FTC’s actions have put the public’s best interests in mind. Goverment intervention has been historically minimal when it comes to media. That is, there has always been a great deal of freedom to self-regulate. But advertising is a different story, largely thanks to the rise of crooked radio ads in the 1920s, which lead to programs like FTC. In other words, advertisers were getting it over on consumers, but that’s not how native advertising should be planned or perceived.
The government’s reputation to initiate effective policies and actions has certainly waned in recent years. But the FTC has not proposed any plans to draft legislation that will upheave native advertising. On the contrary, instead it is looking to focus in on exactly what native advertising is.
Let’s face it, even media "experts" can’t quite define native, agree on what it should be called or, in some cases, identify it when they see it. So maybe it’s time everyone was on the same page?
A July study by the Online Publishers Association revealed that 75 percent of its membership leverages native advertising, and even more plan to do so in the near future. What that means is this isn’t an intermediate fad for generating more revenue; it’s arguably the most important forward-looking trend in publishing. Therefore, figuring it out sooner rather than later is crucial for seamless adoption and scalable appropriation.
Regardless of history, some may still find government intervention as meddlesome. However, Pam Horan, president of the Online Publishers Association, maintains that the FTC’s workshop should be embraced and viewed as a good opportunity. "The FTC regularly convenes workshops like these to identify industry best practices," she says. "And they typically use these workshops to act as a learning tool for their staff as they are thinking about what their role is, and ultimately how they may want to think about developing some form of guidance."
Horan points to recent similar workshops the FTC held which resulted in helpful industry guidelines that ensure everyone is playing fair. Specifically, with Search Engine Advertising Guidance, Dot Com Disclosures and the Endorsements and Testimonial Guides. Horan says, "These identify a set of best practices for the industry and really help establish what the FTC defines as unfair or deceptive practices, because that is what their role is."
Given that, the OPA doesn’t view the workshop as a disruptive probe, but rather a necessary action to learn more about native advertising and how publishers can work together to self-regulate. Horan refers to the process as "a natural evolution."
It’s All About Trust
Fearing how the FTC could transform native advertising implicitly suggests that publishers are once again engaging in deception. So here’s the bottom line: if publishers believe in native advertising, and believe they are presenting dynamic ads that can be clearly identified, then they have nothing to worry about.
Conversely, if publishers are knowingly getting away with taking advantage of consumers, the FTC should step in. It’s a case of basic ethics, in that no matter how successful something is, it should be changed or stopped if people are mislead or cheated.
Horan says that for publishers, "trust is at the foundation of the relation between consumers." Therefore, if native advertising is going to be one of the new standards for generating revenue, then publishers and advertisers must adhere to basic guidelines and best practices while maintaining transparency. Otherwise it will become nothing more than digital snake oil.