Fake News Brought to You by the Ad Wizards of Corporate America

The Sponsors of the Traditional Media Are Cutting Out the Middleman

Black Ops Advertising, Mara Einstein
Black Ops Advertising: Native ads, Content, Marketing, and the Covert World of the Digital Sell by Mara Einstein. Photo credit: Mara Einstein and OR Books

Steve Jobs once said that “people don’t know what they want until you show it to them.” It was a simple message that seemingly reinforced the power of advertising. But “advertising” now comes at us in myriad ways that even Don Draper couldn’t have imagined.

In 1957, social critic Vance Packard published “The Hidden Persuaders” — a book that has become a classic. It was a peek into the emerging world of motivational research and how advertisers were, even then, trying to calculate and take advantage of our inner thoughts, fears, and dreams.

Today, with social media, virtual reality, and Internet-connected screens that are on 24/7, what Packard foresaw and Jobs helped midwife has reached new levels of intrusiveness.

Insidious tools such as native advertising, content marketing, and hidden or subversive advertising — all operating against a backdrop of fake news and intentional disinformation — make for a powerful and toxic stew of “Black Ops Advertising.” That is the focus of this week’s WhoWhatWhy podcast, as Jeff Schechtman talks with professor and independent marketing consultant Mara Einstein.

As a service to our readers, we provide transcripts with our podcasts. We try to ensure that these transcripts do not include errors. However, due to a constraint of resources, we are not always able to proofread them as closely as we would like and hope that you will excuse any errors that slipped through.

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As a service to our readers, we provide transcripts with our podcasts. We try to ensure that these transcripts do not include errors. However, due to a constraint of resources, we are not always able to proofread them as closely as we would like and hope that you will excuse any errors that slipped through.

Full Text Transcript:

Jeff Schechtman: Welcome to Radio WhoWhatWhy, I’m Jeff Schechtman. We know that every aspect of our media landscape is changing. The newspapers are having to move online and find new ways to engage a new audience. Television is now on demand and personal. It has lost its immediacy and its mandate for news and information. The long tail of blogs and specialty news sites reinforces confirmation bias. All of this creates new problems and challenges for content providers, but also for advertisers, that have been the traditional supporters of traditional media. So what’s an advertiser to do? Of late, the answer has been new efforts like native advertising, content marketing, and sponsored advertising. But did these efforts have unintended consequences on the news content itself? We’re going to talk about this today with my guest Mara Einstein. Mara is a professor of media studies at Queens College City of New York (CUNY), as well as an independent marketing consultant. She’s been an executive at NBC and MTV, and it is my pleasure to welcome her to talk about Black Ops Advertising. Mara Einstein, thanks much for joining us here on Radio WhoWhatWhyWhy.

Mara Einstein: Oh, thanks for having me Jeff! I’m really excited to talk about that.

Jeff: Certainly as the entire media landscape has changed and in almost every regard in television, radio, newspapers, etc., particularly as it even relates to news, why should we be surprised in any way that the advertising landscape has had to change in order to keep pace with this?

Mara: Well, I mean there’s two things that’s going on. And in terms of one, that the traditional way that advertising has existed was that it was always very in-your-face, right? They had big McDonald’s yellow arches, and the Nike swoosh, and Coca-Cola signs and all of those things, but we’ve become very adept at being able to avoid all that advertising. And it began with things like the remote control on our television sets, or the DVR, and now online, everything from ad blockers to our own ability to avoid them. You know, banner blindness, we’re going to talk about it as banner blindness. The banners are there but we don’t see them. So instead of the situation where advertisers want to sort of bang us over the head with advertising, the new way of doing it is to hide the advertising so that we don’t even realize that we’re interacting with it, which makes all kinds of sense, it would have to change in the online environment, because the online environment is more one-on-one. It’s more personal, as opposed to if you were sitting down watching something during prime-time television. The advertisers would need to do something to gain your attention and get you to draw in and listen to what the commercial was. In the online space you’re more in, you know, a community sort of environment, right? That’s what Facebook is supposed to be. That’s what Twitter is supposed to be. And so within this environment where we’re not necessarily being given the ads by the advertiser, but by our friends, it becomes a softer sell. It becomes a more, more subversive sell.

Jeff: But truly nothing different than the earliest days of product placement on television, even in black and white television back in the 50s.

Mara: The difference, it definitely comes out of that for sure. What’s going on in terms of advertising now comes out of the ideas of product placement and advertorials in magazines. I think what the difference is now is twofold. One, and let me talk about the difference between native advertising and content marketing because I think people are very confused, including people in the industry are confused about what those two things are. Native advertising is advertising that is created to be indigenous to the space within which it exists. So if you’re on Facebook for example, and you see an ad that comes up and it says something like, “Your friend Susie Smith likes this company,” then that’s one form of native advertising. There may be other forms of it where it does look like an ad and it has a little ghosted button that says sponsored, or has a button where it says, “buy,” and that’s, those are native ads. And those, I think, by and large now people are more or less aware of, though some sites are more obscure about how they present those. Where it gets to be a little less obvious is two places. One, where journalists, the sites that we think of as very much journalistic sites like The New York Times, like the Wall Street Journal, like the Washington Post, present articles that look like articles but are in fact advertising. And you really have to look for the signs that say that this is advertising. And we approach that content very differently knowing that, thinking that it’s journalism or editorial, rather than thinking that it’s advertising. If I read an article, what I think is an article, which is in fact something that has been paid for by an advertiser, by Goldman Sachs, or Shell Oil, and it’s a story about sustainability, I’m going to think about that particular article very differently than I would if I knew that a reporter from The New York Times had written it separate and apart from sponsorship behind it. So that’s native advertising.

The other side of the coin is content marketing. And I think content marketing is what becomes very different from what we traditionally think of as product placement, and this is why content marketing is content that has been produced by an advertiser. It lives on the advertiser’s website and then gets disseminated through social media. A great example of that is something like Coca-Cola. Coca-Cola has their own corporate website and it’s called Coca-Cola Journey. And a lot of things on the website are obviously Coca-Cola. Stories about what they, what their bottlers are doing, what different products are happening, and so on. But they also have a blog within this particular site that doesn’t have any mention of the fact that it’s related to Coca-Cola, but it is being paid for by Coca-Cola. And so the difference is that if it’s really journalism, journalists will go after the other side of the story. If it’s paid for by a corporate sponsor, the corporate sponsor’s message is the one that gets out into the marketplace, without us knowing that they’re paying for content.

Jeff: It’s interesting to see the real antecedents of all of this. We were talking before about early product placement and how to some extent native advertising is kind of the contemporary outgrowth of that. When you talk about content marketing, the antecedents really are the earliest days of television. Actually, the earliest days of radio, where specific programs were produced by a specific sponsor, and it wasn’t NBC, or CBS, or ABC that was sponsoring them. Even going back to the earliest days of radio, it was Philip Morris, or Procter & Gamble, or whatever the product was. So in many ways this is all the kind of contemporary extension of stuff that’s been around for a long time.

Mara: Absolutely. Another great example of something like that would be MTV. I mean all MTV was, was the marketing videos that were produced by the record companies, put onto a television network and presented as content that people would watch. And people did. But it really, all it was, was 24 hours a day of advertising for the record companies.

Jeff: Given the nature of media today, particularly news media, given the pressure, the economic pressures that it’s under, doesn’t the real responsibility for separating the wheat from the chaff, separating the content marketing and the native advertising from the true editorial content, isn’t that really the responsibility of the consumer at this point?

Mara: Well, that’s really why I wrote the book because I would go to…, I spent the last two years going to different conferences and talking to people I knew in the industry, and they all said to me, “People know. People know what native advertising is. They understand what it is.” And particularly millennials, right? Because that’s who this is targeted to. It’s targeted to sort of college age and those beginning their lives, early 30s, so on. And while I was working on this material, I would present it in my classes, I would go to other universities and present it to students, and you could hear audible gasps coming out of the audience because they were so shocked by the fact that they had been engaging with advertising, and they had no idea. And so while most advertisers think that consumers know what this is and are able to understand when they’re interacting with advertising, the fact of the matter is that they’re not. And most of the research that had been done up until recently had all been done by the advertising and marketing community, by corporate companies. And it was only at the end of last year, the end of December last year, there was research that came out from the University of Georgia that said less than 20% of consumers are able to recognize native advertising. Less than 20%. So most people don’t realize that they’re looking at it, and what I found when I’ve been presenting this material, if you tell people how to look for it and where to look for it, all of a sudden they see it everywhere. But until you bring it to people’s attention, they don’t realize that they have to look for something that says “sponsored,” or they have to look for something that says “promoted.” And that’s part of the issue that the Federal Trade Commission has had with this. And you might’ve seen the article on the front page of the Times about Kim Kardashian, and the fact that she promotes products, well, everywhere…  the products of promoting yourself all the time, but on Instagram, and Twitter, and so on. And she’s paid to do that. But there’s nothing in that that says that it’s advertising. And so now the Federal Trade Commission is saying, “No, you have to acknowledge the fact that somebody paid you to say that you like this particular product.” The same thing has also come out in terms of, there’s a young kid on YouTube called Evan who does toy promote, toy reviews, and the FTC’s come after him. And so people do want to know when they’re interacting with something that is advertising. Because they, they come at it with their faculties intact, and they come out with an understanding that I am engaging with content where somebody has a particular bias and it doesn’t mean that they don’t want to, you know, because sometimes advertising can be really great, and there is some really good advertising out there. But you also want to know whether or not there’s somebody who’s trying to sell you something on the other side of the information. And consumers can do that. But they really have to be educated about it, and the Federal Trade Commission so far has not done a particularly good job of regulating the industry so that consumers know. And consumers haven’t been made aware of it.

Jeff: I mean, I would argue that it’s less the purview of the Federal Trade Commission, and more the purview of K-12 education, that people need to learn in this digital age, how to consume information, whether it’s news or entertainment content, or advertising, and that needs to be a basis of learning in the 21st century.

Mara: It’s interesting that you bring it up. I actually just started working with a group called Foolproof, and what they do is create curricula for elementary schools and high schools to teach them about consumerism, and money, and finances, because they feel that’s something that children need to learn earlier and earlier. And they have just created a native advertising study group test force, which I will be working with them on, to create this kind of content so that children will be able to understand when they are engaging with this sort of content.

But I would say, if the Federal Trade Commission doesn’t come in to play on this, somewhere the industry itself needs to start regulating itself, in as much as at least coming up with agreed-upon language so that consumers can begin to say, “Oh, sponsored means there’s an advertiser behind this.” Because every website uses something different, and some of it is really very vague language.

Jeff: On the other hand, it’s also very necessary in order to keep a lot of this content, particularly news content that we’re talking about, to keep it vibrant. Because as you started out by talking about the traditional methods of advertising, the traditional sources don’t work anymore to the same degree they did within the context of the digital universe.

Mara: Yeah, I think that there’s two sides to that story. One is, one of the people that I spoke with says, “Look, if there wasn’t a sponsor behind it, this isn’t content that we could afford to produce.” The question you have to ask yourself is, “Why would you not have chosen to talk about the story to begin with then?” I mean maybe it isn’t something that people necessarily need to have information about. On the other hand, some of these product companies have more information about topics than even research companies, outside research companies do. So there needs to be a balance in terms of what the content is. Now in terms of the advertising for these different sites, I think there needs to again be a balance in terms of making sure that people know that there’s a sponsor behind it and allowing them to have access to the content. Because some of this content is really good. There’s nothing that’s bad about it. The original piece that The New York Times did about women in prison that was sponsored by Netflix and Orange Is The New Black was really interesting information, and probably wouldn’t have been a story that they would’ve covered otherwise. So there is content that’s coming out that is really useful in that way. It can be done in ways that people won’t feel like they’re hoodwinked. It’s when people get hoodwinked that I have an issue with some of this advertising.

Jeff: I mean all of this also is relatively new in terms of… we talked about the antecedents of it, but it’s all relatively new in terms of the way it’s being put out there today, and there’s going to be growing pains as there was with advertising originally on radio and television, and even newspapers.

Mara: This has really taken off in the age of social media because the fact of the matter was, is that companies could create a blog or website for years. Probably almost 20 years now, right? But it wasn’t until social media that suddenly companies were going to be able to disseminate this information. And it’s through social media that some of this gets particularly obscured. And I think as time goes on, as people become more aware of what is native advertising, what is content marketing, that they’ll start to, that there will start to be frameworks that are created around this. The Internet Advertising Bureau has certainly tried. They’ve started doing some things, but they, they’ve really had an awful lot of pushback. The problem is, though, again here too. And there’s the balance between what the advertiser wants – which is at least some recognition of their brand, right? Because if they’re putting the content out there and nobody knows they’re behind it, then what’s the value to the brand? And on the other hand, the publisher wants to obscure that a bit more because they believe that people will be more likely to read the content if they don’t know that the advertiser is behind it. So that’s the fight that’s going on right now between the advertisers… the advertisers and the publishers.

Jeff: It’s also interesting to look at the places where it hasn’t taken hold in. There’s been several efforts over the years, and this goes back almost 30 years, to really bring sponsored content into the publishing world. And there’s always been resistance to it. And amazingly enough that resistance has been successful over the years.

Mara: Yeah, you know, I’m not sure I have a good answer for why that’s true. But what’s also really true, which is funny, is that more people, and even younger people, want a physical book. They don’t all want to be reading on a Kindle. It’s funny because I had my students buy the book for class and some of them didn’t get the book right away.  And I said, “Well why don’t you just download it?” And they’re like, “Oh no, we want a physical book.” So you know I think there is still this sort of sacred space around a book that doesn’t exist in some of these other places. But I want to get back to an idea that I didn’t finish on your last question, which is the idea of ad blockers. And some of what’s going on in terms of why some of this hidden content is going on, particularly video hidden content, is that it doesn’t get picked up by the ad blockers. And as more and more people are starting to block the advertising online, and then this is going to start moving into the mobile space. And the ability to be able to block on the mobile space, more and more of the video content is going to be the sort of sponsored content.

Jeff: Right, and you see it’s almost impossible to see any video content without a pre-roll these days.

Mara: Absolutely. Absolutely. But my concern, and this is where I net out at the end of the book is, okay, so if we don’t want to watch advertising, and we don’t want to engage with advertising no matter what the platform is within which we are watching, video or whatever, then you know, how do we pay for this stuff? Who’s gonna pay for this? And my, what I surmise, and I’m certainly not the only one, is that a lot of the stuff is going to become subscription. So more and more of the money is going to be coming out of individuals’ pockets because we didn’t want to sit and watch an ad. The funny part of that is advertisers knew we weren’t all sitting watching the ads anyway. They knew we were out walking the dog, or grabbing a beer, or whatever it was when the commercials are coming on. But there were enough people watching that they could sell their products.

Jeff: Right, it goes back to the old John Wanamaker line, is, “I know that half my advertising works and half doesn’t. The problem is, I just don’t know which half.”

Mara: Right. Right. Exactly right. Exactly right. And so, you know a decision… I’m concerned that a decision is being made for us in that, since we’re not engaging with advertising or trying to avoid engaging with advertising on any level, then the decision is going to be made for us. That we’re going to have to start to pay for more and more content. And I think people, I may not, I’m sure I know I feel it in my own life, and I know others do too, you start buying HBO Go, and they have the Showtime app, and Hulu, and Netflix, and the next thing you know, you’ve $8, and $10, and $12 a month yourself into several hundred dollars worth of content every month, in addition to everything else.

Jeff: That’s the key point, the addition to everything else, because the $8 and $10 a month, over and over again, still potentially is less than the cable bill.

Mara: Yeah, well, you know that, that’s interesting and what Advertising Age did was try to come up with, okay, if the worst-case scenario happens then, and advertising disappears, and we had to pay for content straight out, what would it be? And what they estimated was it would be about $1,800 a year, which is probably with your cable access or your Internet access. Probably similar to what a lot of people are paying, about $150 a month. The difference is because the advertising disappears you probably only get about 12 channels on that system, and not the full panoply of, you know, 200, or 300, or 500 channels because there isn’t the advertising to support it anymore. And a great way that I try to get students to think about it, young people think about it, is I ask them do they watch television. And they all say no. But then I ask them, “Do you watch The Walking Dead?” And they all say yes. I’m like, “Well, you’re watching television. You’re just not watching it on that thing in your living room. And how do you think that that gets produced?” Maybe some of this is coming out of my old days as a TV person, but I can get concerned about where the quality of content, or how that quality content, is going to be produced. And certainly there’s a number of cable channels that would disappear, and nobody would ever care, but there are others that, you know, we will lose some of the diversity of content that is out there.

Jeff: Beyond the diversity, it has even broader consequences when you talk about paying for content. Even broader consequences in the journalism space because suddenly, if content has a price, if you have to subscribe to everything even if it’s on à la carte basis, at $.99 for an article or $.99 a day to read a particular news site or newspaper online, suddenly the digital divide becomes even stronger. There’s those who could pay and those who can’t.

Mara: Yep, we’ve been talking about this in a historical sense. You want to talk about that in a historical sense. And that’s where newspaper started. Newspaper started strictly as subscription, and not as being advertiser supported. So it was only the elite class who had access to information, and the concern becomes that that may be where we’re going in terms of, you know, being unwilling to interact with advertising. And don’t get me wrong, as a former advertiser, I like really good advertising. There’s some really good, some of the Under Armour stuff that’s being done right now is some really good advertising. Some of the Geico stuff I think this is some good advertising. The Marco Polo ad I think is really clever. And people will interact with advertising if it’s really good and it’s really smart. And it’s when people get lazy that some of the advertising is not things that people want to engage with. But there is seriously the concern about having to pay for content. The other part of that is because of the death of so many newspapers over the last 10 or 15 years, we have just a glut of journalists that are out on the market that can’t find jobs. And where they are able to find employment is with these companies that create marketing content that looks like journalism. And they do it really well because that’s how they were trained to do it. But it becomes really unfortunate, and I talked to a number of former journalists, and they all said, “You know, I would never write anything that I would find offensive. I also wouldn’t write anything that’s going to offend the person who’s paying for it.” And that’s sort of like, yeah, that’s the problem. You’re not going to write anything that’s going to be offensive to the person who’s paying the bill, and because it can be written in such a way as to look like a newspaper article, that makes it really hard to differentiate between that and the ad that’s sitting next to it.

Jeff: Well, I guess it comes back to this question of whether or not it’s good content or not, quality content, and then how clear it is that it is paid for by somebody.

Mara: Yes, exactly. That’s exactly right. And it doesn’t… There’s no reason why, if the content is good, that the advertiser can’t put their name on it, and that that should, in and of itself, keep people from looking at it. It shouldn’t. It absolutely shouldn’t. And the idea, the very idea behind content marketing is that the advertiser has more information about a particular area than almost anyone else, and so that they will provide information to consumers that they want and need, so that when they finally get to the point where they need to buy a product within that particular category, that the consumer will go to that company because trust has been built over time through the content that they’ve provided. That in and of itself, I think, is absolutely acceptable. It’s just that the consumer needs to know I’m getting this information from this company. I mean, BMW’s great example. BMW creates all kinds of community and spaces for the people who buy their cars. That’s great. People don’t walk away because it’s BMW. It’s BMW and they’re a trusted company that creates a really good product, and consumers are willing to engage with the content they provide because they trust that company. If more companies can reproduce that kind of a situation, then that becomes the gold standard in content marketing.

Jeff: It’s interesting that trust is such a key part of it because if you look at where a lot of native advertising and content marketing is going on, it’s really, and coming back to journalism, it’s on the high end of the journalism spectrum. Atlantic Media does a lot of it. The New York Times does a lot of it. Politico does a lot of it. It’s not happening at the bottom. It’s happening at the top.

Mara: Yeah and what’s concerning is that more and more companies, it used to be as you know, the separation of church and state. There was a separation between those who produced editorial content and those who created advertising, and never the twain shall meet. And there was this wall between the two. And what’s happening now is that wall is crumbling. Absolutely crumbling. So people who work on the editorial side are also working in the advertising side and it is, it is very high end. And some of those “articles” are getting the same kind of audiences that the editorial content is getting as well. But you also, you know The Vice does this probably more than anybody else. Slate’s talking points memo… You’d be hard-pressed to find, you know, any named website that is not doing this kind of thing.

Jeff: Mara Einstein, the book is Black Ops Advertising. Mara, I thank you so much for spending time with us on WhoWhat Why today.

Mara: Thank you so much, Jeff.

Jeff: Thank you for listening and joining us here on Radio WhoWhatWhy. I hope you join us next week for another Radio WhoWhatWhy podcast, I’m Jeff Schechtman.

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