Ever since the FTC released its most recent guidelines on native ads, the agency has been cracking down on violations, especially on social media. The guidelines state that native ads must be tagged with “ad” or “sponsored advertisement” for proper disclosure.
When the new guidelines were released in December, Todd Krizelman, co-founder and CEO of tracking and ad analyzing company MediaRadar, revealed that only about 30 percent of sites already complied with the rule and 26 percent of websites run native ads without any sort of mention of the sponsor whatsoever.
Eight months later, the numbers are surprisingly unchanged. According to a study by native ad developer Polar, about one-third of native ads don’t meet FTC guidelines for native ad disclosures, according to an analysis of 137 ad units on 65 publisher websites.
“Regardless of the medium in which an advertising or promotional message is disseminated, deception occurs when consumers acting reasonably under the circumstances are misled about its nature or source, and such misleading impression is likely to affect their decisions or conduct regarding the advertised product or the advertising,” the agency said when it released the native ad guidelines in December.
The report also studied native ads that complied with the FTC guidelines and determined which labels to be the most effective. Native ads labeled as “promoted” achieved the highest click-through rate (CTR) at 0.19 percent, while “sponsored” reached 0.16 percent and “presented” hit only 0.12 percent.
With ad blocking on the rise, it’s a reflection of a changing attitude toward intrusive and uninteresting advertising. However, with 408 million people using ad blocking software as of March 2016—a 90 percent growth (nearly double) from last year, even well thought-out ads go unseen.
Many brands also turn to influencers, whose selling power transcends the ever-changing rules of the FTC, Google and Facebook. Native advertising is an opportunity for brands to showcase their knowledge, tell stories and entertain . . . just don’t forget to follow those FTC guidelines.
Featured image source: Association of Native Advertisers