Here’s What Top Ad Agencies Think Of The FTC’s New Native Advertising Rules

If the new regulations affect your marketing, you’re doing it wrong anyway.

Here’s What Top Ad Agencies Think Of The FTC’s New Native Advertising Rules
[Photo: Keystone, Getty Images]

Over the last couple of years we’ve seen the best possible examples of native advertising, that new jack digital marketing approach that uses content–a story, a video, whatever–that people would probably want to check out anyway. The Atlantic‘s feature on First Couples, The Wall Street Journal‘s Cocainenomics, and The New York Timeslook at women’s prison, are three prime examples and all ads for Netflix. Add to that BuzzFeed‘s piece of Purina video gold “Dear Kitten,” and it’s clear this stuff is here to stay. It also means there will be legions of less-than quality imitations. The kind of thing John Oliver might call repurposed bovine waste.


Back on December 22, the Federal Trade Commission unveiled a guide on native advertising to help prevent customers from being deceived by marketing dressed up like editorial content. In a statement, director of the F.T.C.’s Bureau of Consumer Protection Jessica L. Rich said, “People browsing the web, using social media, or watching videos have a right to know if they’re seeing editorial content or an ad.”

The Wall Street Journal‘s Cocainenomics

The new guidelines say that terms such as “Promoted” or “Promoted Stories” are “at best ambiguous and potentially could mislead consumers that advertising content is endorsed by a publisher site.” They also address where sponsorship disclosure should appear on a site, which is to say, prominently. Mark Howard, the chief revenue officer of Forbes Media, told The New York Times that this kind of standardization will stifle innovation. “As soon as you start to standardize things and put guidelines around things, you limit the level of creativity and innovation that is able to occur. If you put out stringent guidelines, are you going to put people back in the box?”

But executives at some of the world’s top ad agencies say that, more than anything else, these rules simply make official a rule of thumb marketers should’ve been following all along. Native ads should be good enough to stand on their own, no matter how clearly labeled. If deceit is required, you’re doing it wrong.

Goodby Silverstein & Partners’ Head of Brand Strategy and Associate Partner Andy Grayson says the new FTC regulations respect the consumer just as any good creative advertising does.

Photo: Flickr user Classic Film

“We’ve always adhered to the quote from Howard Gossage, ‘People read what interests them, and sometimes it’s an ad,’” says Grayson. “[The new rules] will only raise the bar for bad advertisers to make things that people will actually care about and want to engage with. It’s bad news for garbage ads and good news for creative agencies.”

For Matt Herrmann, chief strategy officer at San Francisco-based Pereira O’Dell, there’s already an understanding between publishers and people, that in exchange for free editorial there will be some sponsored content, and the new guidelines just make that more explicit. “Our experience with branded content has taught us that today’s consumers care less about where the content comes from, and more about the quality of the content,” says Herrmann. “We welcome and applaud these attempts for clarity because we’re confident that the quality of our branded content, native advertising and otherwise, will grab people’s attention regardless of whether they know it’s sponsored.”


Colleen Leddy, head of communications strategy at Droga5, says the agency’s intention is always to create content that people actively want rather than trying to dupe an audience to watch or read something. “We’re always looking to create content people want to consume,” says Leddy. “Native advertising helps us put that content in a place where people are most receptive to it. And our belief is that when you build a strong brand with content and put it in the most receptive context, people will still want to consume your message–even when they are very aware that it’s advertising.”

72andSunny group creative director Mick DiMaria isn’t a big fan of regulation, but says the concern is valid. “As an industry, we shouldn’t need to deceive someone into wanting something. We should make an open and honest case for brands and let people decide for themselves. I think it will push us even harder to do what we already do: Make work that matters in culture.”

Fellow 72andSunny group creative director Justin Hooper agrees that the label shouldn’t matter. “If you create content that on it’s own is entertaining, engaging, culturally relevant and sharable, then consumers, and the press, will seek it out,” says Hooper. “I’m 99% sure those Saturday morning He-Man cartoons when I was a kid were just 30-minute advertisements for Mattel toys, but they were certainly entertaining and a heck of a lot of fun to watch.”

Laura Janness, chief strategy officer at Barton F. Graf 9000 says they don’t mind the regulations at all. “As an agency we fundamentally do not believe in tricking people to engage with the content we create,” says Janness. “Instead, we believe in creating content people want to engage with. Great advertising doesn’t have to disguise itself.”

Jonah Bloom, co-president and co-chief strategy officer at KBS New York says that the behavior targeted by the new FTC guidelines completely misses the point of native advertising. “The business value of content is directly derived from its honest, authentic and transparent nature, so it’s hard to see the point of deceit,” says Bloom. “While I appreciate that some people want to use native advertising units to create reach or scale for their content, good content isn’t about filling in the spaces previously used for ads, it’s about making smart use of owned channels and customer databases to create meaningful relationships and interactions with your audience.”


About the author

Jeff Beer is a staff editor at Fast Company, covering advertising, marketing, and brand creativity. He lives in Toronto.