Since we began the year yesterday with a screed about data gathering practices which are less than forthcoming, let’s continue with some thinking on native advertising. I admit I’m fairly old school about it, but before you jump to conclusions about what that means, let me explain. I mean REALLY old school, such as when the show’s talent stood in front of the camera and did a commercial read. With 40 years in the media business under my belt, I have no problems with advertising. Where I do have an issue is when advertising masquerades as something else.
Let’s start with the fact that consumers generally don’t know that native ads are, in fact, ads. Two studies support this:
Across both studies, relatively few viewers understood that the article itself was paid advertising: only 7% in Study 1 and 18.3% in Study 2 (in which all conditions used the most recognizable language, “sponsored content”).
So even though there was a disclaimer of sorts around the article, having the reader mistake it for editorial content isn’t a bug: it’s a feature. The FTC seems to understand this and issued some guidelines around Christmas. As reported in Media Post:
The new guidance directs companies to label native ads that potentially could be mistaken for editorial content with terms like “advertisement,” “paid advertisement,” or “sponsored advertising content.” The FTC specifically criticizes labels like “promoted” or “promoted stories,” stating that those terms “are at best ambiguous and potentially could mislead consumers that advertising content is endorsed by a publisher site.”
In other words, don’t mislead your readers. Call an ad an ad. The studies, by the way, say that you should do so in the middle of the native piece for maximum identification, and not at the top as is commonly done now. Seems pretty fair, except that the IAB reacted by saying the FTC was way out of line because it might “stifle innovation.” It’s not a small issue – native ads represent a $7.9 billion pool of ad money and that pool is expected to grow to $21 billion by 2018. That’s a lot of misleading.
One need not be a publishing genius to grasp that when a reader figures out that something they perceived to be editorial is, in fact, advertising, they will think less of, and possibly question, everything else in the publication. The research found
When readers perceive a difference between publisher-created editorial content and paid advertising that resembles editorial content there are differences in how they perceive the credibility of the news story. As online publishers seek to balance the pull of native advertising revenue with a potential push for disclosures from regulators and advocates, they should be aware that the best attempts to create informed consumers may result in negative perceptions of news credibility and quality.
In other words, the short-term gain of the native ad can jeopardize the long-term value of the brand’s credibility. That’s not a bug either. There is not a thing wrong with the ad-supported business model until we start disguising the ads. That’s when we jeopardize the entire enterprise, in my opinion. Yours?