Sponsored Content and Disclosure: When the Cat Should Leave the Bag

Credit: Mr. TinDC One of the major trends we are seeing in the technology industry at large is the rise of sponsored content. We’ve long heard the expression “content is king,” and organizations today are investing more than ever before into their content marketing efforts. The trend can be traced to the inherent value in a company presenting themselves as a provider of valuable information as opposed to an advertiser of their own worth.

To further derive value from content, organizations are commissioning influencers and bloggers to cover their company or product. The reasoning is simple: if a knowledgeable third party source says, “Like Company X,” it is more convincing to a potential customer than Company X saying, “Like us.” Yet, immediately the question of ethics comes to mind. After all, just how ethical is it if a company pays an influential person to sing their praises? Fortune recently discussed this very topic, using results from a survey to highlight customer distrust of sponsored content. John Oliver also raised concerns over this growing trend, also known as “native advertising,” in a recent HBO segment. For me, the answer is simple: like with any form of advertising, be transparent with customers. How? Disclosure.

The Federal Trade Commission (FTC) has guidelines for this very subject. Sure, in a relatively new space, sponsored content might seem like it falls in a grey area compared to traditional advertising. But the days of half-page ads above the fold in Section A of the Sunday paper are long gone. And not disclosing when content is sponsored can lead customers to lose trust in a company, ultimately harming reputation.

So here’s a quick guide to ensuring proper disclosure:

Q: When does disclosure need to occur? A: Whenever a company provides a third-party content writer some form of compensation. In other words, if money or services are involved, disclose.

Q: What does disclosure entail? A: There is no specific language that needs to be included. However, general factors to consider include:

  • Proximity: Where in the piece is disclosure occurring? Upfront before the piece begins typically works best.
  • Prominence: Is it easily noticeable? Make it as obvious as possible without ruining the content’s quality, both aesthetically and editorially.
  • Format: What format is it in? Disclose in the same multimedia format as the piece (i.e. radio, video, written, etc).
  • Language: Is it understandable? Don’t use legalese. Use clear language to describe the piece as sponsored content.
  • Social Media: Sharing via a social media platform? Be sure to call out in the social post that the content linked to is sponsored.

In general, the onus is on the company to urge the media to take these steps. Doing so can ensure a great piece of content maintains (or improves) your company’s reputation, maintains a positive relationship with the writer and publisher, and builds customer trust. It may be tempting for a company to try and hide they provided some form of compensation to a publisher, but remember: a customer who knows content is sponsored and takes the time to look at the piece is a more meaningful interaction anyway.