6 Ways to Make Your Native Advertising More Ethical

There’s revenue to be found in content marketing, so long as you focus on legal guidance and reader expectations

Soon after Jeff Jarvis created Entertainment Weekly in 1990, he recalls an odd ad coming across his desk. It looked like any other page of the magazine—same font, same layout—but had one big difference: the image of a hand holding a bag of Frito-Lay chips bursting through the print. The ad department said they wouldn’t run it because its similarity to the rest of the magazine would be too confusing for readers.

The Frito-Lay ad was the first time Jarvis recalls seeing a company mimic the look of a publication. Jarvis says that advertisers have always tried to fit seamlessly into the journalistic integrity of their respective publications, despite resistance from news organizations. But 30 years after the Frito-Lay ad, publications have given in to native ads. It’s rare to peruse a magazine, newspaper or online outlet without finding branded content that mirrors the publication. Often, the lone differentiator is a small, two-word “sponsored content” label somewhere on the page—sometimes, even that label is absent.

Many journalists fear that running sponsored print ads will confuse readers, diminishing trust in news and bringing journalistic integrity into question. “The problem with native [advertising] is that it does try to confuse the reader,” Jarvis says. “And as [the journalism] industry got more desperate, we finally got ready to sell our seed corn. That is our reputation, our editorial space.”

Native advertising does seem to be embraced by the audience. A 2018 report from Reuters found that 73% of readers prefer branded content to traditional ads. And as native ads have proven effective, advertisers have invested. EMarketer predicted that advertisers would spend $43.9 billion on native display ads in 2019, nearly $9 billion more than they did the year before.

While social media platforms receive the largest chunk of that money, the revenue will mean far more to news organizations, which have suffered financially in the transition from print to online. In 2017, a study from WAN-IFRA and the Native Advertising Institute found that native ads brought in 20% of overall advertising revenue for news media organizations. By 2021, this figure is expected to rise to 36%.

But native ads are inherently confusing. They mimic their surroundings and try to avoid being an interruption. Although Reuters’ study finds that 86% of readers can tell the difference between editorial and branded content, 14% can’t—a non-negligible number in journalism, an industry that relies on reader confidence.

In a 2016 paper titled “Native Advertising Is the New Journalism: How Deception Affects Social Responsibility,” researchers asked journalists, advertisers and public relations professionals about their perceptions of native advertising. Each group raised ethical concerns, primarily worrying that native advertising is deceptive and lacks transparency. But advertising and public relations professionals said these ads are a necessary evil, one that’s effective and could be done ethically. One of the study’s authors—Erin Schauster, assistant professor of advertising, public relations and media design at the University of Colorado Boulder and a former advertising account executive—finds it troubling that any readers would be unable to tell the difference between a reported piece and a branded one. She’s unsure if native ads can ever truly be ethical. Not only is journalism’s reputation based in accuracy, but advertising’s reputation is built on trust and the best interests of customers. “You’re not representing the best interests of your client if that’s the approach you take,” Schauster says.

Perhaps the best example of readers feeling tricked by a native ad came in 2013, when sponsored content from the Church of Scientology was posted on The Atlantic’s website. Readers expected a piece of reported journalism about the religion and instead got a laudatory piece of content marketing. Readers were upset, causing the magazine to quickly pull the ad, apologize and change its ad policy. Since then, The Atlantic’s branded content has seemingly improved—in 2016, the company’s senior vice president and publisher Hayley Romer said sponsored content comprised 75% of The Atlantic’s revenue.

Jarvis, now director of the Tow-Knight Center for Entrepreneurial Journalism at The City University of New York, says he now finds branded content acceptable, so long as it’s clear that the ad is actually an ad. But he believes that publications should follow the advice an editor gave him decades ago: “The reader must never be confused about the source of content.”

Here are six ways advertisers, publishers and journalists can ensure that the native advertisements they create are clear and ethical.

1. Follow FTC Guidelines

Schauster says that the baseline for any piece of branded content must be the FTC’s guide to native advertising. Even these rules are often broken, she says.

The FTC’s policy boils down to these tenets:

• Be transparent.
• Disclosures are necessary where content could be deceiving.
• The disclosure, when needed, must be unambiguous and prominent.

2. Clear Labeling

The FTC’s “when needed” caveat grants wiggle room to advertisers and publications. Some try to weasel out of clear labeling by changing the ad’s font as a differentiator, Jarvis says. But the average reader won’t know or care what a different font means.

Even true labels can be opaque. Jarvis says that the Forbes’ “Brandvoice” label—denoting Forbes’ content marketing arm—is an example of bad labeling. Forbes used to have a “What’s this?” link next to the Brandvoice label, Jarvis says, but a label isn’t clear if a reader sees it and immediately asks, “What’s this?”

To be ethical, sponsored content labels must be obvious. No trickery, font changes or off-kilter paragraph alignments.

3. Research More

Jarvis believes that publications, advertisers and researchers should study how the audience sees labeling as they read.

Jarvis says that he recently spoke with a researcher who told him that publications should avoid putting the label in the top quarter of the page—readers have been conditioned to know that this part of the page has no new content, so a “sponsored content” label is likely to get lost. But he believes that more research could help all sides of the native advertising debate.

4. Make the Brand Part of the Byline

Schauster makes the case for brand names appearing in the byline, making it more obvious when a piece is sponsored content. This would also give the brand ownership of the content.

“Brands are all about building reputations with their consumers,” she says. “One way [to do that] is through editorial content that we publish. We’re sponsoring that content to be written, published and brought to an audience. Let’s make that known that we’re aligning with that content.”

5. Never Hard-Sell

Schauster says that brands writing native advertising pieces should leave out the sales pitch.

“It can’t have a slant. That’s not what it is,” she says. “[Native advertising is] aligning your brand with content and the stories that you think are of interest and value to the reader.”

Schauster says that The New York Times’ piece on female prison inmates is a great example of sponsored content that didn’t try to hard-sell readers. The piece was sponsored by Netflix to advertise its show “Orange is the New Black,” placing logos of the show throughout the piece.

“Obviously Netflix was promoting a show, but there was no hard promotion,” she says. “That’s the advertising nature—the financial support. But it’s not a hard-sell. It’s information. It’s content that’s of value to your reader.”

6. Stay Out of the News

The Netflix-sponsored piece was written by Melanie Deziel, who was the Times’ editor of digital branded content. Jarvis says that if news organizations run sponsored content, they should leave the writing to those outside of editorial, as the Times did. Journalists can’t serve both the brand and the public, he says.

From the advertiser’s side, Schauster says that sponsored content works much the same as public relations—call the media’s attention to an issue, then stay out of the process. Many newspapers and magazines now have their own advertising arms to create sponsored content—Buzzfeed, The New York Times and The Atlantic are some of the most prominent examples.

Leaving the writing to publications is more than just ethical; it’s a benefit to advertisers, too. While advertising agencies know about audiences, analytics, developing creative and media placement, Schauster says that they don’t know about writing engaging news content. Maybe one day ad agencies will hire journalists to write sponsored content, she says, but until then: “You leave it to the publishers to do that.”