FTC Eying Publishers Like Gawker For Misleading Native Ads

Gawker – after being reported multiple times to the FTC late last year after #GamerGate found strength in the power of e-mails – is now on the FTC’s watch-list along with a few other major publishers when it comes to native advertising. The FTC will be keeping tabs and holding publishers responsible for misleading native ads.

Mary Engle, the FTC associate director of ad practices and the one responsible for spearheading the recent guideline FAQ for consumers that addresses things like native ads, Let’s Play videos on YouTube and even game reviews, spoke recently at Clean Ads I/O conference in New York City on June 3rd, 2015, according to a report from Ad Exchanger.

Engle stated…

“For us, the concern is whether consumers recognize what they’re seeing is advertising or not,” […] “I would urge advertisers to think about how to communicate [disclosure] to consumers while wanting the ad to be in the flow of what consumers are seeing,”

The Ad Exchanger article notes that examples about misleading ads were used from publishing sites such as Wired, Buzzfeed and Gawker Media.

Engle also mentions that publishers involved with native ad displays on their site – similar to how Gawker employs native ads through Kinja or how they incorporate the native ads to run alongside their standard news and editorial features – are to be held liable for how those ads are displayed on their websites or outlets. If consumers come away misled about a product or service not recognizing that it was actually native advertising, the publisher may be held liable for that if the FTC receives reports about said publisher’s policies and/or behavior.

Previous reports indicated that nearly half of all consumers do not recognize when they are viewing a native ad due to a lack of proper disclosure. Many native ads are written in this manner so as to come across as deceiving so readers/consumers don’t feel as if the content is pandering to them in the form of an actual advertisement.

Previously, it required a lot of detective work to find out if some of the content on Gawker was actually an advertisement or just an editorial. The content was sometimes difficult to spot. After various e-mail campaigns to the FTC about Gawker, the trade commission launched an investigation into the media conglomerate and Gawker proceeded to update their privacy policy regarding ad disclosures.

But Gawker is suffering from more than just the woes of the FTC barreling down their neck. Sprouting from a lawsuit involving unpaid interns, the company is now attempting to unionize in the face of difficulties involving staff working hours, payment and procedures, as reported by Poynter.

Gawker’s chief executive Nick Denton commented about the unionization of the online media outlet, stating…

“While I’m thrilled to know the American labor movement is alive and well, I never thought Gawker would be the test case to prove that.” […] “There’s no reason that so many U.S. workplaces are contentious and I’m very pleased Gawker is leading the movement in the online media world toward collaboration and inclusion.”

Strangely, there was a very candid bit of support – mixed with lots of backhanded compliments – from a former Gawker staff member, in particular Joel Johnson, who was let go from his position back in December of 2014 when the big shakeup happened at Gawker Media and Denton established a board to help with day-to-day operations following the infamous “seven-digit loss” he attributed to #GamerGate.

Pando Daily caught wind of the comment left by Johnson, a former editorial director at Gawker, who stated in a lengthy16-paragraph post

“Why didn’t Kinja work? For the same reason that most attempts to grow and mature Gawker Media have never worked: For someone who trades in bravado, Nick Denton is, perversely, a coward.”

[…] “Gawker Media has succeeded thus far for only two reasons: Nick’s laudable and mostly universal willingness to let writers publish what they choose (until they are fired, anyway) and, of course, the writers intelligence and commitment to the truth, even at great personal cost.”

“[…] you have just given yourselves a chance to push back against the infighting and paranoia that has hobbled the organization for its entire existence.

“You’re some of the greatest writers and thinkers I know, I miss you terribly, and I sincerely hope it works out. You’ve got a fighting chance now.”

Johnson also rolls out all of Gawker’s financial intake, noting that the giant organization roughly brings in $35 through $45 million (plus another $10 million or so from Amazon) a year but only manages $1 million through $2 million in quarterly profits.

With the FTC cracking down on native ads, #GamerGate going after advertisers and the exposure of click-bait journalism coming under fire from the average reader, it definitely makes you wonder if that will affect Gawker’s total revenue, their quarterly profits and whether or not they’ll have to restructure once more?

(Main image courtesy of Alejandro Argandona)





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Billy has been rustling Jimmies for years. The GJP cried and their tears became his milkshake. Contact.

  • Hawk Hopper

    Gawker only makes $1-2 million in PROFIT a year. For all their BS, that’s what they have to show for it. That and Kinja.

    If GamerGate keeps hitting their advertisers and making them pull out from Gawker, we would sink them.

    • Well, technically he mentioned per quarter, which would put their profit up at about $4 million tops a year.

      But yeah, even at only $4 million you could easily get enough advertisers to pull to turn that profit into debt.

      • Hawk Hopper

        Thankfully Disqus has an edit feature so I got to change “yearly” to “quarterly.”

        With Gawker’s yearly profit, I would go with anywhere from $4 million (like Mr. Johnson claimed) or slightly over $6 million (for 2014 which Nick Denton claims here https://archive.is/2WykN)

    • Gamer

      This makes Gamergate all that more powerful the way I see it. If we tanked 1/4th of their yearly profit in just a few days, they are going to have some serious problems in the future.

      I say a few days, because the “we lost 7 figures” comment came pretty fast, and before all the FTC guidelines were in place. So that figure could have gone up even more now, possibly.

      • A Real Libertarian

        It was about 6 weeks from “bring back bullying” to “seven figures”.

        Depending on what specific number “seven figures” is, it could range from half a quarter’s profit, to 2 1/2 times the yearly profit.

  • Oto

    Now this is more like it, this is what Gamergate should be doing, seeking legal instances to punish the perpetrators, instead of whining incessantly at the whims of the anti-GG concern police.

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