Eleven years after last issuing guidance to search engines about displaying paid search results, the Federal Trade Commission sent letters to dozens of companies, including AOL, Bing, Google, and Yahoo, reiterating the need to distinguish between natural and paid search results.
"We encourage you to review your websites or other methods of displaying search results, including your use of specialized search, and make any necessary adjustments to ensure you clearly and prominently disclose any advertising. In addition, as your business may change in response to consumers' search demands, the disclosure techniques you use for advertising should keep pace with innovations in how and where you deliver information to consumers," FTC Associate Director for Advertising Practices Mary K. Engle wrote.
The letters were motivated by a "decline in compliance" over the last decade, Engle noted, as well as changes in technology, that included the increased use of mobile devices, the growth of social media, and the use of specialized search engines. Despite these changes, Engle emphasized that the principles behind the 2002 Search Engine Letter haven't changed. "Consumers ordinarily expect that natural search results are included and ranked based on relevance to a search query, not based on payment from a third party. Including or ranking a search result in whole or in part based on payment is a form of advertising. To avoid the potential for deception, consumers should be able to easily distinguish a natural search result from advertising that a search engine delivers."
The failure to clearly and prominently distinguish advertising from natural search results could constitute a deceptive practice in violation of Section 5 of the FTC Act, the agency warned.
To that end, Engle offered tips to both general sites like the letter recipients mentioned above and to 17 of the most heavily trafficked search engines that specialize in specific topics, such as shopping, travel, and local businesses. Generally, the letters emphasized the need for visual cues, labels, and other techniques to effectively distinguish natural results from paid ads.
In addressing both formats, the letter noted that most search engines offer advertising results with a different background color or shading accompanied by a text label. However, visual cues, such as background shading, have become "significantly less visible or 'luminous'" over the last few years, the agency said. It expressed concern that consumers could not detect a difference on a mobile device or a computer monitor. Therefore, search engines that use shading must "select hues of sufficient luminosity to account for varying monitor types, technology settings, and lighting conditions," the FTC wrote. "Accordingly, we recommend that in distinguishing any top ads or other advertising results integrated into the natural search results, search engines should use: (1) more prominent shading that has a clear outline; (2) a prominent border that distinctly sets off advertising from the natural search results; or (3) both prominent shading and a border."
The agency also recommended that search engines provide text labels that (1) use language that explicitly and unambiguously conveys that a search result is advertising; (2) are large and visible enough for consumers to notice; and (3) are located near the search results (or group of search results) that they qualify. To that end, the agency specifically recommended that text labels be placed immediately in front of an advertising result or in the upper-left-hand corner of an ad block, as research indicates that Web pages are read from left to right, with substantially less focus paid to the right-hand side. Labels must also be "in adequately sized and colored font" and used consistently so as to avoid confusing consumers.
Engle also addressed emerging technology and new search platforms, such as voice assistants and mobile apps. With respect to voice assistants, the agency advised that the volume and cadence of audio disclosures should be such that ordinary listeners can hear and comprehend. Letter recipients were also reminded that new products will be held to the same standards: "if a social network were to stream recommended restaurants based on what a particular consumer's social contacts have enjoyed, it should clearly distinguish as advertising any information feeds included or prioritized based in whole or in part on payments from a third party."
To read a sample letter to a general search results engine, click here.
To read a sample letter to a specialized search results engine, click here.
Why it matters: The FTC's search engine letters are the latest example of the agency's effort to update its guidance to digital advertisers. They follow recent updates to the Dot Com Disclosures and the Guides Concerning the Use of Endorsements and Testimonials in Advertising. The letters also respond to requests from industry and consumer organizations that the agency update its prior guidance to search engines. Both search engines and advertisers should recognize that the letters present a warning that the agency is monitoring paid search results and that such advertising should be clearly distinct from natural search results.