Native Advertising Faces Growing Regulatory Focus

The continuing growth in native advertising is leading to increasing regulatory scrutiny into whether consumers can distinguish native advertisements from surrounding non-paid content, and whether disclosures are being used effectively.

Consumer protection principles apply to native advertising, as the Federal Trade Commission (FTC) has made clear in its "Enforcement Policy Statement on Deceptively Formatted Advertisements and Native Advertising: A Guide for Businesses." The FTC wants consumers to understand when content is paid for by a marketer to promote the marketer or its products. According to the FTC, if consumers cannot distinguish native advertising from surrounding non-commercial content, disclosures such as "advertisement" may be necessary to prevent consumer deception.