Sponsored Content: Avoiding a Run-in With the FTC

By Evelyn Hoover  |  October 1, 2015

Sponsored Content Image

Sponsored content, also known as native advertising, is a topic many MSPC clients are grappling with. Whether it takes the form of blog posts, social media posts, printed material, online articles, etc., sponsored content is written by an organization that pays for its placement on a news site.

There are many reasons for its popularity but most centers around consumer perception. In fact, the IAB and Edelman Berland conducted a study titled, “Getting Sponsored Content Right: The Consumer View.”

To help publishers make sense of the potential gotchas involved with sponsored content, the Minnesota Magazine & Publishing Association invited Mary K. Engle, associate director for Advertising Practices with the U.S. Federal Trade Commission (FTC), to present a webinar for members titled “Sponsored Content: How to Avoid Liability with the FTC.”

Sponsored content falls under the purview of the FTC, which oversees and regulates advertising practices. Specifically, the FTC regulates unfair methods of competition, or unfair or deceptive acts or practices that affect commerce. Engle says that to date the FTC has not specifically prosecuted a sponsored content case, but likens it to other types of non-traditional advertising, such as the advertorials and infomercials of old.

While a brand might not feel vested in how the content is designed by the news site on which it appears, it’s important to understand that in past cases involving the FTC with deceptive advertising practices, the commission has pursued everyone involved, not just the publisher or TV network.

To avoid a run-in with the FTC over sponsored content it’s important to differentiate sponsored content from non-sponsored content. Engle advises that it must be clear to consumers which company is behind the content with labeling at the top, not just in small print at the bottom of the sponsored piece.

Regardless of whether it’s print or digital, she also recommends using shading, a different font and even a different format to delineate sponsored content from non-sponsored content. It should be like a TV commercial, which everyone knows comes from a sponsor, in which the visual cues tell consumers that the content is sponsored and by whom, says Engle.

MSPC further recommends that clients develop a policy around sponsored content. The policy should include tone and voice as well as how the content is presented. Further, the policy should be communicated to all sales, marketing and content development staff to ensure they follow it with all sponsored content developed.

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