Plenty of MSMEs still unaware of need to disclose advertorials, says MY Content Forum chief

The digital era has blurred the lines between advertorials and organic user-generated content. Brands, content creators, influencers and publishers have all expanded into the branded content scene, making it even more crucial for them to be transparent with followers about the type of content that is being produced and the intent behind it. Tech companies such as Instagram and YouTube, for example, now require content creators to include a paid partnership disclosure to ensure transparency with followers.

To further ensure transparency in paid-for space in news programmes as well as influencer marketing, the Communications and Multimedia Content Forum of Malaysia is currently in the midst of a public consultation to review and revise its Content Code 2020. Executive director Mediha Mahmood (pictured) told A+M that the Content Forum is more concerned about the micro, small and medium-sized enterprises (MSMEs) when it comes to disclosing commercial arrangements.

"A lot of MSMEs appear to be unaware that there is a need to disclose their commercial arrangement with influencers or other third parties who carry their advertisements. We understand that this might stem from a lack of awareness that such a disclosure is a requirement," she explained.

As a result, ongoing dialogues and PR activities are still key to educating MSMEs on the importance of being transparent with their advertorials and raising awareness. CMCF is also directly engaging with industry players, including advertisers as well as consumer groups, to ensure everyone within the ecosystem is made aware of these requirements. It also plans to redouble its efforts in offering training on ad guidelines to specific stakeholders, including MSMEs.

On the other hand, most MNCs are aware of the need to disclose their relationship with influencers hired to be their spokespersons, ambassadors or reviewers because they are aware of the existing guidelines and best practices in the ad industry. "They appreciate the fact that consumers nowadays are smarter and have better access to information, which encourages these brands to be as transparent as they can be to uphold their reputable brands," Mediha said.

Aside from brands, influencers and content creators, publishers also play an important role when it comes to making crucial decisions of what gets to be published, Mediha said. Thus, they also control the kind of content individuals consume on their respective platforms.

Online publishers in Malaysia that are existing members of the Content Forum are very much aware of what they can and cannot do based on the Content Code. Once the revamped Content Code is registered, the Content Forum plans to take on a more targeted approach in reaching out to the other online publishers.

While the Content Forum does not have any statistics on specific ads or content that generally do not get declared as advertorials, it received about 169 Internet content complaints last year, which covered a variety of issues including those related to misleading ads. The Content Code currently has a provision that requires ads to be "designed and presented in such a way that is clear they are ads". This includes promotions that are disseminated in exchange for payment or other reciprocal arrangements. Mediha said the Content Forum intends to make this requirement even clearer by revising the Content Code to specifically spell out the requirements for disclosure and detail how it should be done.

According to the updated provisions in Content Code 2021, if the material or programming is in the style of the normal editorial, material or programming, whether paid for by the same or different advertisers, particular care is needed to ensure that no part can be mistaken for the normal editorial, material or programming matter. Also, ads or marketing communications that include the involvement of third parties, such as influencers, under a commercial arrangement shall be clearly disclosed as being done in exchange for payment in cash or some other reciprocal arrangement in lieu of cash.

Mediha said:

Disclosure allows consumers the benefit of making an informed choice, protects influencers themselves from being manipulated by unethical advertisers who use them to flout advertising rules.

"It also encourages brands to tap into the power of word-of-mouth social media marketing without eroding the trust that it is built on," she explained. Without a doubt, a lack of transparency can impact the perception and reputation of both the brand and the influencer. Mediha also acknowledged that social media platforms even have tools for influencers to easily disclose sponsored content. "Yet, quite a number of them are still reluctant to do so, because they feel that disclosing a commercial arrangement may reflect negatively on them," she said.

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Citing a 2019 article by Harvard Business Review, Mediha said "disclosure makes almost no difference to the impact of the influencer’s recommendation on the purchase decision". In fact, "disclosure may actually have reinforced the importance of influencers in purchase decisions".

"Disclosure is very important to the audience because it is considered crucial information for them to assess the validity of an influencer’s recommendation. Failure to disclose puts the influencer at a risk of being ‘cancelled’ should they be found guilty of misleading their followers," Mediha explained.

At the same time, failure to disclose also leaves an influencer vulnerable to many other potential backlash. For example, when their followers purchase a product based on their recommendations but the product does not live up to the expectation or worse, there are detrimental side-effects from its use, the customers may blame the influencers for giving false testimony and either the influencer goes viral for being associated with a dodgy product or they might even be exposed to legal risks, Mediha said.

Meanwhile, brands will risk losing consumers' trust if they are found to be dishonest. "Brands need to remember that social media is also a very strong investigative tool. It only takes one tweet to go viral exposing their dodgy marketing tactics and a brand’s reputation can be annihilated globally within minutes," she added.

When asked about the areas consumers should take note of when trying to discern between an advertorial and organic content, Mediha said consumers should not be expected to have to play investigator to try and discern between an advertorial and organic content. The responsibility lies in the content creator and publisher to make it clear for them, by distinctly disclosing when content is paid-for.

Aside from influencer marketing and paid-for space in news, the updated Content Code 2021 also has added provisions for the prohibition against restricting alcohol ads to certain mediums, "switch selling", false claim of "closing down" or "moving out", and the use of religion in ads. The emergence of new media, especially social media, has made the regulation of alcohol ads more difficult.

While the status quo in the Content Code is that all ads on alcoholic drinks and liquor are not allowed, Mediha explained that the Content Forum is proposing to allow intoxicating liquor to be advertised on online platforms to level the playing field with print and other online media. It is also an effort to ensure that such advertisements online are regulated, which is why the proposal also includes strict requirements on what one can and cannot include in the advertisements, she added.

Also, unlike TV and radio that involves "push content", which may reach audiences not intended to be the target for ads, such as children and Muslims, Mediha said online media involves "pull content" and search algorithms that serve ads based on users' search habits and user preferences.

"This essentially considers the fact that such ads on the online platform can be controlled to ensure that it only reaches its target audience," she said. Hence, this ensures that the ad is not as easily pushed to unintended viewers the way it would be via TV and radio.

Among the list of members the Content Forum is currently working with for the content code include the 4As and MAA, as well as numerous brands including FMCG firms. The proposed revisions in the Content Code are a result of the Content Forum's members attempting to address the policy gaps that have been raised in recent years, especially considering advancements in technology and societal developments as well.

To date, the Content Forum has received more than 500 responses to its public consultation and these include input from advertisers and brands. "Some of the proposed revisions have ignited a bit of debate, for example, the proposal to allow online advertisements of intoxicating liquor. We welcome these debates because at the Content Forum, we believe that debate is a good indicator of a progressive society and is also a catalyst for growth," she said.

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