Industry moves to counter regulation over native ads

The UK digital media industry is keeping a close eye on moves to counter potential industry regulation on how brands and publishers distinguish native ad formats from editorial content in the US. This comes as the emerging ad types are tipped to become the most widely-used online format within a dozen years.  

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The IAB’s US entity has set up a Native Advertising Task Force consisting of 80 companies representing advertisers, media owners and technology providers, to agree upon best practice around ‘blending’ commercial messaging with editorial content – ‘native advertising’ or ‘sponsored content’. 

The Native Advertising Task Force, whose leadership consists of representatives from the IAB itself, Sharethrough and Yahoo, is preparing to publish a “prospectus” proposing how best to achieve a consistent mix of the two different pieces of content, during this coming quarter. 

This move towards self-regulation includes debating the content-type, context and format of the ad units. It also comes as the US Federal Trade Commission (FTC) prepares to host a workshop to “examine” the practice of these ads more closely resembling editorial content. 

In particular, the workshop, scheduled to take place on 4 December, will focus on which entity controls how native ads are presented to consumers, how they can be differentiated from regular content and consumers’ ability to delineate between the two.

IAB UK is taking a close lead from its US counterpart on developments there, with a recent poll of IAB UK members showing over half (52 per cent) of respondents saying they ‘know what native advertising is, but needed more information’ on it. 

Meanwhile, the survey also revealed that 20 per cent of respondents described themselves as ‘experts’ on native advertising, while a further 12 per cent conceded that they had ‘never heard of it’. 

Lee Baker, chief marketing strategist at online ad firm Respond and ex-AOP managing director, says that while it is still be a bit “premature” to “standardise” native advertising, or branded content, more consensus among the different stakeholders in the online advertising industry needed. 

He says: “I don’t think native advertising is being bought by the same team from agency to agency. 

“We don’t need standards right now but what we do need is to be speaking the same language.” 

Web giant AOL, whose Huffington Post Media Group owns editorial brands including Engadget, Huffington Post and Techcrunch, forecasts that 40 per cent of its online revenues will come from native ads next year, and further predicts such ad formats will surpass ‘traditional online ad formats’ by 2025.

An in-depth look at the state of native advertising can be read here

Native advertising formats:

Native content is a digital advertising method where the advertiser attempts to gain attention by providing content in the context of editorial content, matching both the form and function of the environment in which it is placed.

This content can take the form of promoted videos, images, articles, music and other media and examples might include promoted tweets, promoted stories on Facebook, promoted posts on Tumblr or sponsored ‘listicles’ (’top 20’-style articles) on BuzzFeed or The Huffington Post.

Native advertising rules: 

In the UK, section 2 of the ASA’s Cap Code deals with the recognition of marketing communications and these rules apply regardless of the targeting or medium. 

Marketing communications must be obviously identifiable as such on all platforms. While context driven content is not a problem, cloaking advertisements as editorial is. 

The Consumer Protection from Unfair Trading Regulations 2008 (CPRs) specifically prohibits “using editorial content in the media to promote a product where a trader has paid for the promotion without making that clear in the content, images or sounds clearly identifiable by the consumer.” 

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