FTC Warns Publishers: You’re Liable

In an attempt to curb potentially deceitful publishing, the Federal Trade Commission (FTC) issued a stern warning to publishers on native advertising and sponsored content.

FTClogoAt risk of FTC sanctions is the growing number of publishers that are acting more like creative agencies on behalf of their partners.

“Traditionally, publishers have not been held responsible for misleading ads as content was created by ad agencies. However, with more publishers creating content themselves, [the FTC’s Mary] Engle says they are to be held liable,” notes Helen Leggatt in BizReport.

And just slapping a “sponsored by” label on it is not enough. According to Leggatt, “It must be visible enough that even consumers that only look at the headline will be informed it is advertising content.”

To be precise, Engle clarified that an ad (and that’s exactly what the FTC is calling sponsored content) is “deemed deceptive if it misleads a significant percentage of consumers, by which she means 15%, or sometimes as low as 10%,” Leggatt explains.

This is becoming increasingly important as publishers launch in-house creative initiatives to create branded content for their partners and assume the liability that has traditionally gone to outside agencies.

With the FTC weighing in, clearly this issue isn’t going away soon. If publishers don’t figure this out, expect firm guidelines from the FTC on this hot button topic.