Revealing Truth: why disclosure works best for brand-funded content

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Product claims, emotive statements and aspirational set-ups that have characterised brand advertising for most of our lives are being somewhat shunted sideways by native and content-based advertising.

Push-style advertising doesn’t work so well with content that has to be independently appealing to readers choosing to read, watch, or use brand offerings in media controlled by the audience rather than the media owners.

Relationships between brands, media and customers have altered forever – or at least are in the midst of change – and trust is the currency at the heart of those relationships.

Why media owners are turning to brand-funded content

Digital media works differently to traditional, linear broadcast and distribution media. Digital audiences are fragmented in an unfamiliar way. They’re fluid and likely to engage with many more publishers than when they have to pay for specific publications, a licence fee, or a limited channel view. Digital delivers a great deal more than a pure ‘media’ experience. From shopping to customer service, taxing your car, renewing your passport, banking and so on, it’s a reference library, social club, filing system, meeting point and even product delivery channel. And everyone accesses all this individually and in multiple contexts.

As digital has become a mainstay of our lives – and more so now we’re mobile – so traditional media audiences have declined.

Viewing figures of more than 20 million people were common into the 1990s for drama programming. In September 2015, the opening episode of the final season of ‘Downton Abbey’ attracted just 6.7 million – a fraction of what advertisers used to expect for popular drama.

National newspaper circulations have decreased by almost half during the last 10 years, and magazines – particularly niche titles – are suffering similar declines. That’s not to say the brands are disappearing. The migration of the publishing model online has established news and magazine brands as some of the most high-traffic online destinations – the Mail Online and The Guardian are just two examples of news brands now embedded into our digital cultural lives with substantial audiences and at global scale.

But the ad revenues haven’t been following the audiences. Typically, according to the consultancy Enders Research, digital inventory values are a worrying fraction of those for print inventory. In 2014, the proportion of digital ad revenue per visitor, says Enders, was as low as 8% of the print equivalent per reader for some titles.

This gives media owners a double challenge: how to deliver advertising platforms that engage fragmented audiences and how to increase the value of their inventory.

And they have turned to what they understand best – the creation and distribution of high quality content. Native advertising and ad-funded content is driving commercial innovation across the media ecosystem.

The role of trust in content-based advertising 

For advertisers, brand-owned content has always been a feature of their marketing activities – Michelin even spawned a publishing empire based on its maps and place guides originally produced to encourage more road trips. Procter & Gamble and Colgate Palmolive sponsored radio shows, as radio became America’s mass audience medium, pumping out product messaging coast-to-coast to captive audiences hooked on the new ‘soap operas’.

Entertaining or useful content was a secondary stock in trade. A great example of this comes from the Pampers Institute. It established a vast stock of baby development articles produced by eminent paediatricians and child psychologists. Designed to partner parents as they embarked on child rearing, the articles eventually surfaced on Pampers websites across the world. The articles don’t discuss Pampers nappies.

It is a proven fact that people will seek out and by implication trust useful, entertaining and authentic brand-owned content, as long as it’s clear that there’s a relationship between the publisher and the advertiser.

The reader and the audience have a right to know whether they are in paid-for or editorial space. Whenever this is not clear, we erode the trust between publisher and consumer everywhere, and everyone suffers.

Tiffanie Darke, Creative Content Director, News UK

In qualitative research carried out for the IAB by 2CV, audiences told us that as long as content was relevant and valuable to them, it didn’t matter if it was branded. What did matter to them was finding out afterwards that what they had read or watched was advertising content and not general editorial content. Don’t trick us, they said. When there is no labelling or poor labelling, it can negatively change their impression of both the advertiser and publisher.

More than any other non-traditional digital marketing approach, native blurs the line between editorial and advertising. Publishers and advertisers alike are finding this a considerable challenge, and so from a regulatory perspective, this presents a huge problem. Crucial to resolving this is a clear and consistent set of definitions that the industry agrees on.

Steve Payne, Head of Planning & Insight, Northern & Shell

So trust is at the heart of the effectiveness model when advertisers partner with publishers to reach audiences. That trust is critically important to both partners: publishers are, in effect, trading the value of their relationship with their audiences when establishing content-based advertising deals, and this should be a publisher’s premium inventory.

Figure 1. IAB Consumer Content & Native Research, Q4 2014


The development of disclosure principles to guide effective content creation

Labelling is the key to signalling the existence of a publisher/brand relationship to audiences. It’s what audiences expect. In the UK, non-broadcast advertising is strongly regulated by the ASA (Advertising Standards Authority). The regulations are built around the CAP (Committee of Advertising Practice) Code, and digital media is treated in exactly the same way as its offline counterparts.

As native and content-based advertising suddenly emerged as important revenue streams, the IAB worked with the industry to develop a set of disclosure guidelines to ensure that publishers, advertisers and their agencies are fully aware of UK legislation, and to provide advice around how to maintain compliance.

These disclosure guidelines were released in two phases:

Native distribution ad formats

Non-formatted advertising, such as advertising features

The guidelines set out to do two things for the industry: firstly, to alert all stakeholders to the existence of current legislation by describing it; and secondly, to create principles of compliance that emphasise the very positive nature of compliance, thus encouraging the development of high-quality, audience-friendly content.

The interesting thing with content labelling – and something the IAB was acutely aware of during the development of the disclosure guidelines – is how the tone and language of the label also play a role in expressing the publisher’s brand identity. How the label is worded for a VICE audience, for instance, will differ from that for a Good Housekeeping audience.

Labelling is not just about the wording. Our consumer research identified the importance of visual cues that help audiences – for instance, the clear placement of a brand logo. People make split-second decisions to engage with content and the provenance of an article is one of the many considerations they process rapidly.

Our researchers determined that, during this split-second moment, there are three factors affecting the decision to engage or not with content:

Audience loyalty and trust is a thing of immense value, built through considerable investment in reliable, good quality content and reporting, and through sharing consistent values. This is what publishers trade with advertisers and why the risk of getting it wrong often outweighs the opportunity to earn revenue. Therefore, not every advertiser partnership request makes it through a publisher’s consideration process.

Arriving at our disclosure guidelines was a cross-industry enterprise. The IAB worked with not only its own membership group comprised of traditional and digital media owners, agencies and ad-tech suppliers, but also other industry trade bodies (AOP, CMA and ISBA) to gain widespread support and endorsement of the guidelines.

We also had to define what we were addressing. The lines between paid content and editorial have been somewhat blurred, and the term ‘native’ has added to the confusion with inconsistent definitions in play across the industry. That was another task taken on by the IAB. Our Content & Native Council created a definitions framework, rather than attempt to lock down distinct formats at a time when the industry is just beginning to explore the extraordinary diversity of content-based ad solutions.

Figure 2. IAB Content & Native Definitions Framework


The IAB’s definitions framework (see figure 2) has been designed to reflect the evolving nature of content-based advertising solutions and addresses both native distribution programmatic formats and non-formatted, ad-funded content. As well as supporting the development of phases one and two of our disclosure guidelines, the framework defines how we measure media spend from these newer revenue forms. It will be continually revised by the Council.

Phase one of the disclosure guidelines relates to native distribution formats, typically found in newsfeeds and in social media feeds such as FaceBook and Twitter. The guidance principles are especially clear about the need for visual cues with in-feed and recommendation units. As well as text labels and brand logos, we suggest good practice is to use other devices such as background colours. (See figure 3.)

Figure 3. IAB Disclosure Guidelines, Phase I, Native Distribution Formats


Phase two covers non-formatted, ad-funded content. Both sets of guidelines include the three principles of relevancy, value and clarity. (See figure 1.)

The IAB’s primary purpose is to create the right environment for digital advertising to thrive in. This is the key driver for the creation of these disclosure guidelines, with baked-in, best-practice principles aimed at improving the quality of digital advertising wherever it appears.

Quite simply, if advertising creates a bad experience for audiences or is mistrusted, it will not be effective for brands or publishers. Native advertising solutions provider Polar regularly carries out benchmarking research. It found in 2015 that native ad formats that carry the brand’s logo perform better than those that don’t – 15% better. And that’s good news for an ad-funded Internet, where audiences choose what they consume and gravitate towards content that’s relevant and valuable enough for them to engage with.

About the author

Senior Industry Programmes Manager, Internet Advertising Bureau UK (IAB)