We live in a world of product innovation. There is sea change going on in media and technology. It seems that there is a new media platform and revolutionary device announced every week. Advertising is the currency that allows the offering of free information and services in media to consumers. Consumers absolutely want free content
They had the Beatles, we’ve got the Eagles. They have Big Ben, we have the Washington Monument. There are endless comparisons to make between British institutions and those born in the United States, and things are no different the advertising field. Today, we’re talking specifically about advertising industry self-regulation, which both the United States and United Kingdom got serious about in the latter half of the twentieth century. In 1962, the United Kingdom advertising industry established its Advertising Standards Authority (ASA), which adjudicates claims of non-compliance with the British Code of Advertising Practice. Nine years later, the National Advertising Review Council – now known as the Advertising Self-Regulatory Council (ASRC) – was formed in the United States.
Both are non-governmental, industry-funded bodies that self-regulate advertising. And over their similar timelines, they have both matured into respected forces with broadened mandates (both, for instance, are tackling online behavioral advertising) that enjoy near-total industry compliance with their decisions. Of course, they are not identical. While the ASA is something of a “one-stop shop,” the ASRC has established a number of subject-specific investigatory and adjudicatory departments such as the Children’s Advertising Review Unit and the Electronic Retailing Self-Regulation Program. Also, the appellate process is substantially different in the United Kingdom, where appeals cannot go forward until an Independent Reviewer agrees to accept them.
But what fun would it be if we did things the same? That would be like tuning in to Breaking Bad and getting Downton Abbey: Albuquerque.
The Way I See It
• I see advertising industry self-regulation since the 1960s as an almost unqualified success, with enormous benefits to the public (in the form of more honest advertisements), advertisers (in access to efficient dispute resolution), and the image of the advertising industry as a whole
• The success of self-regulation has undoubtedly staved off more restrictive legislation that would have been enacted in its absence, giving the industry both here and in the United Kingdom a greater chance to define its own path.
• I see a critical moment on the horizon with the emergence of concerns around mobile advertising and food marketing to children, giving the industry a chance to again prove the value of self-regulation in those areas.
The Way the Industry Sees It
I sat down with Tim Lefroy, CEO of the Advertising Association, an industry forum critical to shaping the self-regulatory scheme in the United Kingdom, to explore the topic further.
What are the biggest differences you see between the self-regulatory system in the United Kingdom and United States?
We are two nations, divided by different principles and legal systems. You have the First Amendment. In Europe we have the Human Rights Act. In the United Kingdom, where the free exchange of ideas remains highly valued, the reality is somewhere between the two. United States self-regulation ultimately has the Federal Trade Commission as its backstop, but it is administered state-by-state by the Better Business Bureau. Our Advertising Standards Authority (ASA) – the investigator and judge – is completely independent and has been for fifty years. The codes are written and updated by industry and are often enshrined in United Kingdom and European legislation. In part due to the lack of a First Amendment, the United Kingdom is more exposed to the whims of politicians where threats to bans or restrict advertising freedoms in lieu of social policy are commonplace.
Is it important for the public to understand that the advertising industry is policing itself, and if so what’s the best way to get that message out?
Let’s be honest. Whether it’s Fred Bloggs or John Q. Public, advertising is low-priority for most. Our industries and their output pass most people by, most of the time. But if we want politicians to appreciate how self-regulation in advertising works – for industry and for consumers – we must advertise that fact. The ASA has a mission that advertising in all media is legal, decent, honest, and truthful. Those four words have, over the years, been reinforced through advertising. There is a strong correlation in the United Kingdom between trust and confidence in our system and the ASA being active in promoting legal, decent, honest and truthful advertising. A little advertising for advertising can go a long way.
On Thursday during Advertising Week in New York City, I hosted an event called “Mission Impossible: Truth & Privacy – The Future is Now,” featuring Commissioner Julie Brill of the Federal Trade Commission, along with Frank Abagnale, one of the world’s foremost authorities on fraud and identity theft (you may know him best from the film Catch Me If You Can – he was portrayed by none other than Leonardo DiCaprio), and Jonathan Salem Baskin, Co-Author of Tell The Truth. Privacy is an issue everyone is talking about these days, and I wanted to share with you some of the thoughts and issues discussed during the session at Advertising Week. Click here to view a video of Ron’s conversation with FTC Commissioner Julie Brill.
Advertising is a fascinating and complex industry, reflecting the latest innovations, the newest technologies, and, of course, the height of creativity. Advertising is a reflection of the fundamental changes sweeping our society – the transformative effect of digital, the changes in all forms of media, the importance of data and the rise of wireless. Amidst this rapid change, privacy is one of the most important issues in the advertising and media business, and one which demands our attention now, not tomorrow.
The Way I See It
- I see that digital technology and media has created an unprecedented “Holy Grail” opportunity for marketers to have conversations with consumers as individuals wherever they are on a broad array of devices. The question we must answer is, how do we manage the legitimate privacy concerns?
- I see the FTC’s role and influence in steering the privacy and data security debate and action rising in importance.
- I see global marketers and agencies working in good faith either alone or in groups to navigate safely through leading edge issues and the concerns of interested parties – the government, agencies, marketers, technology providers, media and consumers.
- I see “do not track” continue to be a central issue that focuses many of the important advertising industry and societal issues about both what can be and what should be.
- I see “privacy by design” being a simple concept, but a difficult concept to execute in real time.
The Way The Industry Sees It
Commissioner Julie Brill of the FTC shared some extremely valuable insights with me and the attendees of our Advertising Week session. I then asked Commissioner Brill some follow up questions that touched upon some of the conversation that we had in our Advertising Week session.
Can you highlight what you see as the role of the FTC in regards to its relationship with the advertising industry’s need to focus on consumer privacy and data security?
The Commission has developed a set of best practices, as outlined in the agency’s March 2012 final privacy framework, for companies that collect and use consumer data. (“Protecting Consumer Privacy in an Era of Rapid Change: Recommendations for Businesses and Policymakers,” An FTC Report (Mar. 26, 2012) available at http://www.ftc.gov/os/2012/03/120326privacyreport.pdf.) Because the advertising industry is among the heaviest users of such information, these best practices can be useful to the advertising industry –including ad networks, individual advertisers, and all other players in the advertising eco-system—as they develop and maintain processes and systems to operationalize privacy and data security practices within their businesses. In addition to our policymaking role, the Commission takes action against companies—including those in the advertising industry—that do not treat consumer data in accordance with the laws enforced by the agency. For example, we took action against several advertising networks that misrepresented their practices involving consumers’ ability to opt-out from online behavioral advertising. (See press releases, “FTC Puts an End to Tactics of Online Advertising Company That Deceived Consumers Who Wanted to “Opt Out” from Targeted Ads” (Mar. 14, 2011), available at http://www.ftc.gov/opa/2011/03/chitika.shtm; “Online Advertiser Settles FTC Charges ScanScout Deceptively Used Flash Cookies to Track Consumers Online” (Nov. 8, 2011), available at http://www.ftc.gov/opa/2011/11/scanscout.shtm).
In the fast paced world of marketers and agencies where they must implement “privacy by design”, what is the biggest issue confronting the industry?
Well, there are a lot of big issues. One of the biggest issues is the rapid pace of today’s technological advances. Companies are bringing products and services to market as quickly as they can—and the advertising and marketing have to keep up with that pace. As a result, companies may not be employing a methodical process to consider all the privacy and data security issues that could arise with the product or service, or with an advertising or marketing campaign. I think one of the most important elements of Privacy by Design is for companies to take the time to thoroughly examine the consumer information they are collecting, what is being done with that information, and how it is being safeguarded. In our privacy report, we stress the importance of operationalizing these processes, which will help companies conduct these analyses in an efficient and timely fashion.