The Federal Trade Commission has always been concerned with blurred lines between advertisements and editorial content. They use their authority to prevent deceptive practices, defined as claims likely to mislead consumers acting reasonably. In 2013, the FTC held a workshop highlighting the need for transparency in native advertising. They heard that transparency maintains trust, and industry groups will develop best practices. Examples of increased transparency include publisher branding, textual disclosures, advertiser logos, bold coloring, and shading to distinguish paid content. The FTC wants industry to increase transparency voluntarily rather than face regulatory action.

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LMA / BIA Kelsey
Native Advertising Summit
July 9 2014July 9, 2014
ISN’T THIS A NEW
ISSUE?ISSUE?
NO!
Will Government Regulators Derail Native Advertising?

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FTC has always been concerned about “blurred lines”
between advertisements and editorial contentbetween advertisements and editorial content
Uses enforcement authority under Section 5 of the
Federal Trade Commission Act
Will Government Regulators Derail Native Advertising?

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What is a deceptive act or practice?
FTC Deception Policy Statement, 103 F.T.C. 110, 174 (1984)
It’s likely to mislead consumers
Who are acting reasonably under the circumstances,
and
It would be material to their decision to buy or use the
product.
FTC Advisory Opinion on ads in news format
73. F.T.C 1307 (1968)
Will Government Regulators Derail Native Advertising?

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FTC targets 10 operators of fake news sites for
making deceptive claims about acai berry weight loss
(Apr. 19, 2011)
 C i h ld “ id l f t t th t
FTC’s Bureau of Consumer Protection
Letter to Search Engines
(June 2013)
 Companies should “consider several factors to ensure that any
labels and visual cues used are sufficiently noticeable and
understandable to consumers.”
Will Government Regulators Derail Native Advertising?

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Federal Trade Commission Workshop
December 2013
Agency wanted to highlight the need for transparency for
the consumer
 What the FTC heard?
Transparency maintains trust for the publisher and the
brand
There should not be a prescribed method for identifying
native advertising
Industry will develop best practicesIndustry will develop best practices
Self-regulation in publishing industry
Interactive Advertising Bureau
Use language that conveys advertising has been paid forUse language that conveys advertising has been paid for
Be large and visible for consumer to notice
American Society of Magazine Editors
Should be prominently labeled as advertising
Source of content should be acknowledged
Should include prominent statement or “What’s This?”
rollover at the top of the ad unit
Newspaper Association of America
NAA / API worked with FTC prior to workshop
“Whit P ” t ti f i i t f“White Paper” on tactics for increasing transparency for
the consumer
Will Government Regulators Derail Native Advertising?

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Examples of increased transparency around
native advertising
Publisher Branding
 Some publishers have formal sponsored content programs,
sometimes with a dedicated department or assigned staff.
Will Government Regulators Derail Native Advertising?

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Textual Disclosure
 Many newspapers use textual disclosures to label content that is
paid for by an advertiser.
Advertiser Logo
 Several publications use the advertiser’s logo to create greater
transparency for the consumer.
Will Government Regulators Derail Native Advertising?

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Bold Coloring
 Several publications use coloring effects to offset the sponsored content
from the original content to provide transparency for the consumer.
Shading
 Some publishers use shading to offset their sponsored content from the rest of
their editorial content.
Will Government Regulators Derail Native Advertising?

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FTC looking for the industry to
do the right thing
Resources
 American Press Institute, “Understanding the Rise of Sponsored Content”
(Nov. 2013), available at:
http://www.americanpressinstitute.org/publications/reports/white-
papers/understanding-rise-sponsored-content/
 Federal Trade Commission, “Blurred Lines: Advertising or Content? An FTC
Workshop on Native Advertising” (Dec 4 2013) available at:Workshop on Native Advertising” (Dec. 4, 2013), available at:
http://www.ftc.gov/news-events/events-calendar/2013/12/blurred-lines-
advertising-or-content-ftc-workshop-native
 “IAB Native Advertising Playbook” (Dec.4, 2013), available at:
http://www.iab.net/nativeadvertising
 “ASME Guidelines for Editors and Publishers” (May 2014), available at:
http://www.magazine.org/asme/editorial-guidelines
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Questions?
Contact: Paul Boyle, NAA Senior VP/ Public Policy
Paul.Boyle@naa.org
571-366-1150
Will Government Regulators Derail Native Advertising?