CNN has confirmed that they started to run native advertising in the midst of their article links, specifically meant to look like editorial content in order to drive readers to their advertiser’s websites. While many sites are doing this, the way CNN is doing seems to be deceptive and the purpose is to trick consumers into thinking they are going to an article either written by CNN or by some editorial partner. This type of advertising, while effective, has come under great scrutiny by regulators including the US Federal Trade Commission (FTC.)
According to Bennet Kelley, an online marketing and compliance Attorney, “the FTC has grown increasingly frustrated over the growth of native advertising.” In 2013, the FTC sent warning letters to search engines and held a workshop on the topic because “[i]ncreasingly, advertisements that more closely resemble the content in which they are embedded are replacing banner advertisements.”
Kelley examined a CNN.com advertisement for LendingTree (below,) and said that it is clearly a deceptive native advertisement, “since the ad implies that it’s a CNN story” and doesn’t make it clear it is a sponsored result. “This is misleading and is the type of example the FTC is growing less and less patient about.”
Mary Engle, Director of Advertising Practices Division for the FTC said earlier this year, “for us, the concern is whether consumers recognize what they’re seeing is advertising or not.” The failure to identify the content as an ad is compounded when dealing with regulated products for which certain disclosures may be required but which are absent in native ads. We asked Revcontent, a company that provides native type advertising how they manage issues with their publishers.
So what do other companies do to ensure compliance? James Epstein, General Counsel of RevContent told us his company “takes a two prong approach which requires that publishers present widgets in ways in which it is clear to consumers that they are linking to third party content and that the content is sponsored.”
Performance Marketing Insider spoke briefly with Mary Engle of the FTC, who said wouldn’t comment on specific examples such as the issue with FTC, but did mention that they plan to release guidelines that make it more clear what type of disclosure is needed on native advertising like this.
CNN did not return emails and phone calls seeking comment about their practices.
