FTC Publishes Exploratory Report Examining Native Advertising

The Federal Trade Commission has released a staff report summarizing agency-commissioned exploratory research from 2014-2015. The report, entitled “Blurred Lines: An Exploration of Consumers’ Advertising Recognition in the Contexts of Search Engines and Native Advertising,” explores consumer recognition of paid search advertising and “native advertising” that resemble news, feature articles, product reviews, entertainment or other non-advertising online content.

The report details the manner in which consumers perceive search and native ads and how modifications to disclosures, including to disclosure language, position, text size, and color and to other visual cues such as borders and background shading, may enhance consumers’ recognition of these advertisements.

The report also compares a test group of consumers’ reactions to advertisements on a series of web pages with another test group’s reactions to the same advertisements with modified disclosures to improve their prominence and conspicuousness. The report tested advertisements that consumers viewed on either a desktop computer or smartphone and measured eye movements as they viewed the web pages.

The results suggest that the disclosure techniques discussed in agency guidance to search engine companies and to native advertisers remain relevant insofar as increasing the likelihood that consumers will recognize an ad as an ad.

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Richard B. Newman is an Internet marketing compliance and regulatory defense attorney at Hinch Newman LLP focusing on advertising and digital media matters. His practice includes conducting legal compliance reviews of advertising campaigns, representing clients in investigations and enforcement actions brought by the Federal Trade Commission and state Attorneys General, commercial litigation, advising clients on promotional marketing programs, and negotiating and drafting legal agreements.


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Richard B. Newman

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