The ASA watchdog is regulating the Wild West of online marketing and advertising
It goes without saying that the web has revolutionised the global economy. As a source of knowledge and information, as well as a marketplace for trade, it has created jobs, fuelled innovation, and accelerated productivity (well, it has when we’re not browsing Twitter or watching Netflix).
The internet has also changed advertising. The digitisation of content has led to the digitisation of ads, especially via giants like Facebook and Google. This has lowered the marketing cost barrier for small firms – anyone can now advertise their business online.
That’s great for competition and consumer choice, but it’s also created challenges for traditional platforms like newspapers and broadcasters, as well as headaches for regulators like the Advertising Standards Authority (ASA).
“A lot of people are now advertisers – but they don’t necessarily think of themselves as advertisers,” says Guy Parker, chief executive of the ASA since 2009.
“There’s a challenge for us to educate the hundreds of thousands of businesses of all shapes and sizes which are advertising in the UK that they need to follow the advertising codes.”
The ASA has had to change with the times in order to cope with the rise of online advertising. Originally established in 1962 by the ad industry, its job was to regulate and investigate complaints about marketing in print, TV and radio. It dealt with over 27,000 such complaints in 2017.
When investigating these complaints, the ASA can decide to ban an ad for breaking a rule – perhaps because it was misleading, offensive, or made false claims. According to Parker, in 97 per cent of cases where the watchdog rules against something, then the brand will change or take down the advertising.
But in cases where a brand continues to misbehave, the ASA doesn’t have the power to enforce a ruling. Instead, it refers the company to Trading Standards (or Ofcom if the ad was a broadcast), which can issue fines and other sanctions – in extreme cases, Ofcom can even revoke a broadcaster’s licence to operate.
“That’s not a situation that a responsible broadcaster is ever going to get close to letting happen, because it would be an existential crisis for them. But it’s a useful big stick in the cupboard,” says Parker.
And yet with so many new players entering the advertising world thanks to the internet, the ASA’s best tool is education. In fact, while you’ve most likely heard of the ASA from news headlines about an ad ban, the watchdog isn’t just reactive – it works proactively to teach advertisers how to comply with the rules in the first place using training and advice. It also publishes its complaint rulings so that brands can learn from them.
“It can be easy to make mistakes – the rules are so tough,” says Parker.
“We want companies to get it right in the first place – given the choice, we don’t want to be banning stuff.”
Currently, a major priority for the ASA is educating those working in influencer marketing, the biggest thing to emerge online in recent years.
Bloggers, Instagrammers, and YouTube stars with millions of followers can earn fortunes by promoting a product. Up until now, the lines have been blurry – it isn’t always clear if an influencer is recommending something because they genuinely love it, or because they’ve been paid to do so.
In 2017, a makeup blogger called Sheikhbeauty got into trouble with the regulator for not labelling a post promoting a slimming tea product as an advert. This year, Made in Chelsea star Louise Thompson has had two Instagram posts banned for not disclosing that they were sponsored content for a watch and a facial brush.
The ASA wants to stop this occuring.
“We’ve had a lot of success working alongside statutory regulators like the Competition and Markets Authority to raise awareness of the importance of properly disclosing when your content is advertising and provide guidance on how you should go about doing that,” says Parker.
He adds that the professional end of the influencer market isn’t the problem – content creators who’ve spent years cultivating a following organically don’t want to compromise their authenticity and lose their audience’s trust. It’s people like Thompson who have been catapulted into fame that are proving an issue.
“The trickier end of the influencer market is celebrities, particularly reality TV show celebs, who got famous from being on Love Island or Geordie Shore, and are now making some money out of promoting stuff on their social media feeds,” he reveals.
These types of influencer aren’t as clued-up on the rules, so the ASA has spent considerable time reaching out to talent agencies to ensure that they are advising their clients on disclosure rules, and recently produced a guide that spells out how and when influencers should make it clear when something is an ad.
But why do advertisers need a regulator in the first place? Some of the more libertarian readers of Morning Wire might ask why waste money on a media watchdog when consumers can decide which advertisers to trust.
Parker doesn’t agree with this vision of a marketing Wild West, saying that it wouldn’t be fair on people. “The public deserves a good level of protection from irresponsible advertising by a regulator.”
But beyond appealing to fairness, Parker argues that the regulator ensures a level playing field for businesses – without this, advertisers that lie and mislead would have a competitive advantage.
“If advertising is not trusted or believed, then it doesn’t work. It’s enlightened self-interest to want to have a good level of regulation,” he adds.
Looking ahead, technology will create fresh challenges for the ASA. It is paying close attention to voice-powered assistants and smart speakers like Siri and the Amazon Echo, as well as to how artificial intelligence and big data will be used to personalise and target ads at individuals.
“Our data gets crunched and the ad we’re served is slightly different to the ad that other people get served,” he explains. “That’s going to be an interesting thing to regulate – how do we make sure we know what ad has been received by someone? What decisions have been made by the machine to serve that ad? There will be ethics involved in that.”
Whatever your views on the ASA, it isn’t going anywhere. It allows the advertising industry to remain mostly self-regulated, keeping the government at arm’s length. And as there will always be bad actors, perhaps it is good to have an organisation policing the industry. Otherwise the internet – and the broader world of marketing – could end up as an anarchic Wild West of false and misleading claims.