Innovation@work: Understanding the Legal Do’s and Don’ts of Social Media Advertising (Part 2)

By: Kristin Mendoza

“Fake news” has been a source of FTC investigation since in the late 1960s. As originally used, “fake news” took the appearance of a favorable restaurant, book or product review or feature story in a newspaper or print publication that was written by the advertiser in a style that made the public believe that the piece was written by a neutral third party providing an unbiased and independent point of view.

Social media platforms provide companies with a new opportunity to embed advertising into content in ways not previously available in traditional media. However, in order to maintain and grow their number of users, these same social media platforms frequently allow users to set preferences to avoid or minimize seeing digital advertisements. In order to resolve the tension created by platforms needing to sell advertisements in order to generate revenue while also respecting user preferences for limiting content (and thereby maintaining a larger user population), we’ve seen an explosion in native advertising.

“Native advertising” or “sponsored content” can be easily and inexpensively formatted so that advertisements match the style and layout of the content into which it is integrated. Native advertising will commonly appear within the news stream of the social media site (rather than off to the side of the web page). The effect is to mask the visual and contextual signals consumers customarily have relied upon to recognize an advertisement or promotional message. A style and format that has been particularly scrutinized by the Federal Trade Commission (FTC) is advertising content appearing in a news format.

Do’s and Don’ts for News Formatted Advertising

A determination of whether an advertisement’s format misleads as to the ad’s nature or source depends on how reasonable consumers would interpret the ad in a particular situation. An “advertisement” or “sponsored content” caption alone may not prevent a determination that an ad is deceptive if “the format of an advertisement so exactly duplicates a news or feature article as to render the caption ‘ADVERTISEMENT’ meaningless and incapable of curing the deception.”

Therefore, you want to make sure that your native advertising avoids the appearance of fake news by following these guidelines:

• Avoid the use of content titles that read like newspaper headlines. For example, Local Company Discovers New Way to Improve Weight Loss is a headline suggestive of a local newspaper or media outlet
• Avoid the use of reporter by-lines
• Do not use language that suggests that your product or service is an endorsed or affiliated program of a government agency. For example, Federal Mortgage Relief Program for Homeowners Now Available suggests that the service is somehow authorized or offered under a federal government program
• Use a “sponsored content” or “advertisement” caption with native advertising that is prominent and noticeable to consumers. Revealing that the content is advertising within the text of the ad or, if the headline is designed to cause the consumer to click through to another website, once the consumer clicks through to the landing page of the other website, can qualify as deceptive advertising
• Avoid content formatted to appear as a third party investigative report on a new product or service or a third party scientific report on the effects or results of a product or service

Although digital media has expanded and changed the way marketers reach consumers, all digital advertisers must comply with the same legal principles regarding deceptive conduct that have traditionally been enforced by the FTC. Advertising that leads consumers to give it greater credibility by giving the appearance that the content was the result of independent investigation, evaluation or vetting when it was, in fact, sponsored by the advertiser is deceptive. As a result, news style content must be carefully worded to avoid any such deception.

If you have any questions or concerns about whether advertising content that you would like to use to promote your business could be viewed as deceptive, speak with an attorney.

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