FTC to Examine Native Advertising More Closely

Agency sets workshop for Dec. 4, which could lead to possible guidelines

Publishers that may be playing fast and loose with native ads, blurring the lines between ads and content, shouldn't be surprised that eventually the Federal Trade Commission would take notice.

Worried about whether consumers are confused by native ads or sponsored content, the FTC scheduled a workshop Dec. 4 to do a deep dive into the popular practice, bringing together publishing and advertising industry reps, consumer advocates, academics, and of course, regulators to explore the consumer protection implications.

"It used to be pretty clear," wrote Lesley Fair, a senior attorney with the agency's bureau of consumer protection. "The entertainment portion of a show ended and the commercials began. The two column article ran on one side of the newspaper and the ad on the other. Or the Web page had the content in the middle with a banner ad running across the top. Things are more complicated now."

While native advertising may be a fairly new trend in the digital world, the FTC has always policed ads masquerading as content under its Section 5 authority to prohibit unfair or deceptive advertising. 

The December workshop could be a first step before the FTC issues guidelines for native advertising the way it has for other digital ad practices platforms and formats. For example, the watchdog group has made recent updates to its endorsement and testimonial guidelines, updated dot-com disclosures and warned search engines like Google and Bing to better distinguish between paid and regular search results. 

During the workshop, the FTC will explore the ways paid messages are integrated and presented as content and how ads can be effectively differentiated from regular content via labels and other visual cues. It will also look at what the research shows about how consumers notice and understand paid content that has been presented as news or entertainment, or integrated into editorial.