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FTC Trying to Read Between the Blurred Lines of Native Advertising


Recent Happenings in APRM
October 2013

Seeing "suggested posts" in your Facebook feed? Scanning through your Twitter feed only to find promotional tweets? Ever do a double take when you realize that you've just read an online ad without realizing it? The Federal Trade Commission (FTC) may have done this too. And now they are trying to understand what this might mean for consumers.

With the rise of this "native advertising," that is, advertisements that are blended into the surrounding content, the FTC is starting to ask some questions about whether consumers know where an ad ends and where content begins. It is not surprising that the FTC is engaged in this area: with the recently revised Dot Com Disclosures Guide, the Guides Concerning the Use of Endorsements and Testimonials in Advertising and its recent enforcement against companies who were "astroturfing" (i.e., falsely posing as independent third parties in providing testimonials or reviews), the FTC has established itself as a presence in reviewing advertising content and format on the internet.

And, as with so many of its other areas of interest, this latest foray into native advertising is starting with an FTC workshop, currently scheduled for December 4, 2103 (although, with the shutdown still ongoing, the timing of the workshop could change). The workshop, which is open to the public, will explore the implications of native advertising with the ultimate goal of "help[ing] ensure that consumers can identify advertisements as advertising wherever they appear."

The FTC is currently asking for topic proposals and requests to participate to be submitted by October 29th. Topics that may be discussed at the workshop include:

  • What is the origin and purpose of the wall between regular content and advertising, and what challenges do publishers face in maintaining that wall in digital media, including in the mobile environment?
  • In what ways are paid messages integrated into, or presented as, regular content and in what contexts does this integration occur? How does it differ when paid messages are displayed within mobile apps and on smart phones and other mobile devices?
  • What business models support and facilitate the monetization and display of native or integrated advertisements? What entities control how these advertisements are presented to consumers?
  • How can ads effectively be differentiated from regular content, such as through the use of labels and visual cues? How can methods used to differentiate content as advertising be retained when paid messages are aggregated (for example, in search results) or re-transmitted through social media?
  • What does research show about how consumers notice and understand paid messages that are integrated into, or presented as, news, entertainment, or regular content? What does research show about whether the ways that consumers seek out, receive, and view content online influences their capacity to notice and understand these messages as paid content?

And these questions are likely only the beginning: as technology and marketing practices develop, the FTC focus on native advertising will likely only intensify. If you would like to participate in the workshop, please let us know.

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