As companies increasingly implement voluntary measures to enhance transparency among their user base, this month, YouTube introduced the option for creators to feature paid promotion disclosures on video content.
As publishers increasingly rely on more modern methods of native advertising – that is, ads designed to look and feel similar to a platform’s editorial content – as a source of revenue, the FTC has taken steps to clarify when native advertising may cross the line and become deceptive to consumers. Recently, the FTC published two documents that address the Commission’s position on the use of native advertising – an Enforcement and Policy Statement on Deceptively Formatted Advertisements (“Policy Statement”) and a business guide entitled Native Advertising: A Guide for Business (“Business Guide”). Under the Policy Statement, advertising that misleads consumers in a material respect, including with regard to its commercial nature, is deceptive under section 5 of the FTC Act. Under FTC law, advertisers cannot use “deceptive door openers” to induce consumers to view advertising content. Thus, advertisers are responsible for ensuring that native ads are identifiable as advertising (typically, through some sort of disclosure) before consumers arrive at the main advertising page. In addition, no matter how consumers arrive at advertising content, it must not mislead them about its commercial nature.
Continue Reading The FTC Clarifies Native Advertising Enforcement Guidance