Native content, frequently referred to as “native advertising,” has been around for decades in various forms. Essentially, native content is the practice of blending paid or sponsored content with a report on news, entertainment, and other editorial or owned content in print, digital, or other media.
Last year, there was much debate and regulatory scrutiny about how traditional marketing-law principles apply to digital native content. For example, the use of native content sparked discussion in the context of the Facebook Sponsored Stories class action lawsuit, which I discussed in detail in my June 29, 2012 PRWeek column. In addition, native content has recently appeared in the form of promoted tweets, branded playlists on Spotify, search results on Yahoo Stream Advertising, and sponsored posts on BuzzFeed.
Nearly all PR firms now use native content to amplify their clients' marketing campaigns and promote brand appeal. A study by the Online Publishers Association stated that nearly 75% of its members currently offer native content, with up to 90% expecting to have provided native solutions to clients by the end of last year. A 2013 Pew Research Study showed that native advertising grew 45% from 2010 to 2011, and went up another 30% from 2011 to 2012.
Many regulators have taken the position that native content often disguises itself as editorial or owned content, which has the potential to mislead consumers. According to an October 2012 Harris Interactive poll, 57% of consumers who had viewed a native advertisement on Facebook said they found it misleading. Because of this, the Federal Trade Commission (FTC) held a workshop on native content in December that convened industry, academic, and government experts in a discussion about what level of disclosure the FTC should demand from marketers and publishers engaging in posting native content. The FTC has also sent letters to major search engines stating they should delineate between search results that are paid placements and organic search results through the use of clear and conspicuous disclosures.
While the FTC might issue further guidance, it will likely also continue to monitor native marketing practices through enforcement of Section 5 of the Federal Trade Commission Act. Under that law, misrepresentations or omission of material facts regarding a marketing claim (including the omission of the fact that a particular piece of content is paid or sponsored when it appears otherwise) is regarded as deceptive.
The start of the New Year is a good time to take stock of what these guidelines mean for the PR industry. Here are some practical tips for handling native content appropriately, while still keeping in mind the importance of maintaining a cohesive brand strategy and promoting consumer engagement.•Disclosure, disclosure, disclosure. Marketers should be particularly cognizant of providing clear and conspicuous disclosure of a sponsored story in situations in which native content appears across multiple social platforms, such as re-blogs or re-tweets. Each time the paid content is used, the disclosure must be clear and conspicuous. This, in and of itself, can be an exercise in creatively using clear visual cues, separate labels, boxes, or other creative display techniques to distinguish between paid and editorial content – all in order to avoid misleading consumers.
•Third-party contracts. Marketers or their PR firms must ensure that the disclosures used to identify sponsored content are recognizable and understandable to consumers. PR agencies might also consider including a provision in their contracts with online publications requiring the publisher to distinguish between paid and editorial content.
•Intellectual property issues. Agencies and PR firms typically bear the burden of responsibility for ensuring any content (including native content) does not infringe any copyrights, trademarks, or other intellectual property rights held by others. All integrated content should be carefully screened for potential red flags, especially when user generated content is involved.
•Keep brand strategy top of mind. All content publishers should make sure there is consistency between the message of paid content and the overall editorial content and brand. However, even with adequate disclosures, the virtue of native content – that it can fit seamlessly with editorial content – can cause PR problems if it conflicts with brand values or otherwise adversely affects consumer loyalty.
•Establish clear guidelines. Every PR agency should have guidelines for the use of native or paid content, separate and apart from other guidelines they might have. This is increasingly important given the recent explosion in the variety of mobile and online devices via which we all receive native content. These guidelines should set parameters to ensure that paid content is distinct in design, style, and format from editorial content. Experienced legal counsel should be consulted to help develop these approved guidelines.
Michael Lasky is a senior partner at the law firm of Davis & Gilbert LLP, where he heads the PR practice group and co-chairs the litigation department. He can be reached at email@example.com.