With advertisers becoming savvier, it can be increasingly difficult to establish if something is actually an ad.  The concept of identifying an ad is becoming a key issue in advertising regulation.  The increasing relevance of this is something that is captured in the New Zealand Advertising Standards Authority (ASA) new Advertising Standards Code (Code), as well as the ASA's Guidance Note on the Identification of Advertisements (Guidance Note).

From 1 February 2019 all ads must comply with the Code.  The Code consolidates six, now retired, codes, being the Advertising Code of Ethics, Code for Comparative Advertising, Code for People in Advertising, Code for Advertising Food, Code for Environmental Claims and Code for Advertising Vehicles.  The concepts that the retired codes were based on are continued in the new Code, in a slightly different format and with more detail.

The Code sets out two broad principles.  (1) Social Responsibility – requiring ads to be "prepared and placed with a due sense of social responsibility to consumers and society" and (2) Truthful Representation – requiring ads to be "truthful, balanced and not misleading". Each Principle has a number of rules, which are non-exhaustive examples of how the principles may apply and associated guidelines which provide further information on how the rule works. 

The first rule of the second principle is that Advertisements must be identified as such.  The associated guidelines specify that "content controlled, directly or indirectly, by the advertiser must not be disguised as something other than an advertisement." The guidelines also set out that it must be obvious to and understood by the audience that they are engaging with an advertisement, regardless of the platform where it appears. This is particularly topical in light of the increased use of 'influencers' as an advertising method. This is further picked up by the Guidance Note.

The Guidance Note sets out a two step approach in identifying ads:

  1. Is the content an "advertisement"?
  2. If it is, is it appropriately identified to the relevant audience?

The ASA has a very broad definition of "Advertisement" being "any message, the content of which is controlled directly or indirectly by the advertiser, expressed in any language and communicated in any medium with the intent to influence the choice, opinion or behavior of those to whom it is addressed."  The definition does not extend to bona fide news, editorial, reviews, broadcast content not controlled by advertisers, and generally product labelling (there are however, certain exceptions in relation to some labelling).  

Content control is a good indicator that something will be considered an ad, for example if the advertiser has final sign-off on a post about a product or a brand. .On the flip side, a TV show using sponsored product, which they can use and comment on any way they like (and not controlled by the product provider) is not likely to be considered an ad.  Financial payment is not necessarily required for something to be considered an ad.  Providing free products in return for content which is controlled by the advertiser may be considered an ad.  

The increase of methods used to advertise can make the identification of ads much less obvious than it once was.  If the ad is such that it is not obvious an "identifier" may be required.  The appropriate identifier will depend on a range of factors including the platform and medium used, but examples include #Ad, #Sponsored, 'Paid for Ad' or a call to action such as 'go to' the advertisers website. 

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.