May 30, 2023
Mike Isaacson: Lügenpresse!
[Theme song]
Nazi SS UFOs
Lizards wearing human clothes
Hinduism’s secret codes
These are nazi lies
Race and IQ are in genes
Warfare keeps the nation clean
Whiteness is an AIDS vaccine
These are nazi lies
Hollow earth, white genocide
Muslim’s rampant femicide
Shooting suspects named Sam Hyde
Hiter lived and no Jews died
Army, navy, and the cops
Secret service, special ops
They protect us, not sweatshops
These are nazi lies
Mike: Welcome to another episode of The Nazi Lies Podcast. Today, we're talking about the lying press with Jonathan Hardy, professor of communications and media at the University of Arts, London. His most recent book, Branded Content: The Fateful Merging of Media and Marketing, explores the world of branded content, particularly native advertising or sponsored content–longform marketing copy made to look like news items. Welcome to the podcast, Dr. Hardy.
Jonathan Hardy: Thank you, Mike. It's a pleasure to be here.
Mike: It's great to have you. So I'm really excited to talk about marketing with you because that's the industry I'm in now, and I do have some ethical issues with some of the techniques that we use. Now I write in the B2B space, selling services to business owners and officers, so I don’t super have a problem with what I do–you know, manipulating business owners into buying things.
So reading your book, what comes up again and again is that most of these marketing techniques aren’t new, but the digital age has made them more invasive and persistent. Can you talk a bit about how digitization has changed the advertising world?
Jonathan: Sure. Well, it's done so definitely in a great many ways but I'll talk about some key ones that really relate to the work I've been doing on branded content. In the 20th century, through most of the 20th century, we had a model that I call advertising integration with separation, which means that the advertising appeared in the same vehicles as media.
When you looked at a magazine or a newspaper, you turned the page and it’s editorial, you turn the page, it's advertising. Or the adverts that appeared between programs on television and radio. So we had integration, but often some quite strict rules and strict practices that kept advertising and media separate.
So what we're seeing in the digital age is an intensification of two tendencies which face in opposite directions. One is towards integration, so advertising getting baked into media content and integrated with it; product placement all the way through to influencer marketing, branding content and so on. But the other trend is disaggregation, advertising getting decoupled from media. Because essentially in the digital age, advertisers didn't need–as some of them put it–to pay the premium prices to put their ads in media content. They could track users around the internet. So these are trends going in opposite directions obviously, right? One is about integration, the other one is about disaggregation.
But I argue that they have one really common power, which is that they indicate the growing strength of marketers over media. Media that rely on advertising revenue are having to become more and more dependent, satisfying advertisers who want to integrate their content so that people will engage with it. And they're also desperate because of these other trends of losing ad revenue coming from disaggregation to kind of, again, appeal as much as they can. So what we're seeing is a strengthening of marketer power in the digital age.
Mike: So my intention with this episode was to give a deep dive into how things like the Cambridge Analytica scandal could have happened. To start, let’s get some technical details. We’re talking mostly about inbound marketing today. So before we get into advertising techniques and stuff, what is the difference between inbound and outbound marketing?
Jonathan: Sure. Well, I'll talk about that, Mike. But we should acknowledge there's some confusion here, because these terms are not always used to talk about the same things.
I think one really valuable aspect is this idea of push and pull, right? If you're pushing out messages, this is known as outbound marketing. You're sort of pushing your message out to reach people. If you on the other hand create great content that people come to you for to engage with, that's pulling. And that's known as inbound. So, so far, so good. That makes sense to me.
But this is used in other ways too, and I think that illustrates actually a broader point which is that marketers, not surprisingly, are often in a competitive struggle to be on the side of the new and the innovative, and not the old and the tired. So some versions of inbound and outbound marketing I think get a bit problematic here. Because outbound in some versions is kind of associated with scattergun marketing. Right? The opposite of inbound as highly targeted aiming at particular people.
And I don't really buy that. You know, marketers sometimes talk about spray and pray, for instance, you know? Chucking out messages. But quite honestly, most of the time modern marketers don't do that because they can't afford to do that. So I don't really buy the argument that outbound is untargeted. I think that's misleading.
What's a bit more helpful from all of this, and actually quite a crucial issue, is if you like the challenges for a thing called push marketing. The challenge is when people are not engaging with traditional advertising forms and pushing them out, and the need to come up with more engaging content; either because it's more entertaining or it's more informative. And I think that aspect of inbound is important.
Mike: So when it comes to inbound marketing, it’s all about the buyer journey or the marketing funnel. Can you talk a bit about the theory behind the marketing funnel?
Jonathan: Yeah, sure. I often test this out on students, but if you were studying advertising in the 20th century, you might have come across a model called AIDA, which was a mnemonic, helps you remember some important fundamentals.
AIDA stands for Awareness, Interest, Desire, and Action. And it kind of summed up this idea of what's called in modern terms, a marketing funnel or a customer journey. Sort of how if you're a brand, people start off with awareness and then become more interested and motivated all the way up to purchase. That's essentially what the marketing funnel means.
Just to relate it to branded content for a moment, it was often argued in the past that brands branded content, which means content that's produced or funded by brands, was particularly associated with that early stage–building brand awareness.
But if you speak to people in the industry, they say it's not really true. Branded content is the content that serves people right across the customer journey. So if you think someone becomes more interested and they want to find more information about the product, for example, I think they're right and I think that's–
We're often thinking about a new world where brands are involved in kind of thinking, "What are the information needs? What are the communication needs of consumers at every point?" And engaging with it. And amongst other things, that's breaking down some old divisions between what we might call advertising and customer services. And as an academic, I'm really interested. I'm critical of a lot of what's going on, but I'm interested in how that speaks to a changing world and convergence across communications.
Mike: Where I work, we definitely use branded content across the buyer journey and we use different kinds of content for different points along the journey. So for instance, we do more informative content for when you're in the awareness stage. Whereas when you're in the purchasing stage, we hit you more with salesy content. Because that's the point where you're trying to just hear about the benefits and decide upon a final product.
Jonathan: Yeah exactly.
Mike: Can you talk a little bit about the software that's used to track customers? Because that's something that I don't think most people are aware about, the CRM software.
Jonathan: Yeah. CRM means customer relations management software. Some of your listeners might be aware of software like Salesforce, which tracks relations between a company and its clients, or including its prospects. So yeah, customer relations management is a huge area.
One of the things I looked at interestingly was the annual reports of what are called the holding companies. These are the really big groups that own advertising agencies and PR agencies. And they've been in a battle for survival and for their presence in companies, and they're often fighting alongside companies like Accenture who are offering companies all sorts of other data services.
So it's a kind of interesting world in which the traditional advertisers are maneuvering to cover more ground because that ground’s becoming more and more important to companies. And definitely, all the data around customers and other people in the chain is a really important battleground for these firms.
Mike: Okay, and we'll talk a bit about what gets fed into the CRM in a bit. So the company I work for, we do exclusively owned media and digital ads, pretty much all inbound with an occasional email campaign here or there. But there’s other forms of digital advertising, too. Let’s start by talking about what owned media is. What do advertisers mean when they talk about owned media?
Jonathan: Okay. This is content that's produced and published by the brand or the marketer themselves. It's got a really long history. In the United States at the end of the 19th century, the farm implements company John Deere had a magazine called The Furrow, for example. So what we now call contract publishing by a brand. Lots of other examples; the Michelin Guide to restaurants, the Guinness Book of Records, and so on.
Brands have been involved in producing their own content for a long time, but this really got turbocharged in the internet age. With the early internet, brands started to create their own websites and web pages. They've now moved right across social media, for example. And some brands have become essentially media companies. So a brand like Red Bull, which is involved right across kind of music, sports, etc, is producing content of all kinds to support the brand.
Your listeners, again, one of the models that's really helpful for students and might be of interest to your listeners is called PESO. PESO stands for paid, which is a term for advertising essentially, right? The brand pays and controls. Earned, which stands for traditional public relations. You work in PR, you write a great story or a feature, it gets carried by the media, you didn't pay. That's called earned media. The S is for shared. Used to be called viral, but shared is a much nicer word for things that get moved and amplified across the internet and social media. And then the O is owned. And what PESO tells us is, these things are still separate but they're overlapping and converging in the middle.
Mike: Right. So the problem with owned media is that you have to get it in front of people. What are the various ways that advertisers try to get their own media to an audience?
Jonathan: Well, I'm just gonna... If you don't mind, I'll just pick up this word 'problem', Mike, because it might help to explain where I come from on these issues.
I think the industry is essentially looking for how to do marketing better, right? And quite a lot of people who are in academia, in universities like myself, are really asking and answering the same question. Their aim is really to help marketers do better and do research on it. And I call all of that affirmative. So the problem from that framing is how can we do this better? How can we learn how to be more effective?
But I would self-describe myself as coming from a critical tradition, a tradition of critical political economy. And we ask a different question about “problem.” We say, "Are there problems in the way communications are organized and delivered? Are there problems for communication users? Are there problems for societies? And if there are, if things aren't great out there, let's identify them, understand them, and think about how to change them." So when I come to questions of problems, that's really the kind of dominant lens that I look at them. But obviously like anyone in order to understand things better, you've got to listen to everyone in this space; to industry practitioners, and I work a lot with them.
So that's just a wider framing, but actually to answer your question. Well, it's interesting because historically, they've struggled. Right? Brands have kind of invested in great content and then found surprise, surprise! People aren't always interested in going to corporate websites and finding this stuff.
So part of this story has been brands producing content that they need advertising, social media advertising, to say to people, "Hey, we've done this. Here's a snippet, but come and look at the full amount." That's an interesting feature. But essentially, in this space brands would say, "Well, you've got to produce material of value back to this language of sort of pull. People have to be engaged, entertained, and/or informed. Those are the key things you need to do to solve the problem."
But the other thing we'll come on to is when the marketing messages get disguised and buried. Just to give you another take on problems, I think there are problems about brand's own content. Sometimes that can be really entertaining and I enjoy it like anyone else, but there are problems essentially because it's a brand voice. And sometimes that brand voice can be louder than other voices. And that essentially is an issue. But actually, I see less problems with brands and content compared to the material that's weaved into media content: sponsored, editorial, native advertising, and so on.
Mike: Okay. What about things like SEO, SMO, paid search, display ads? That sort of thing.
Jonathan: Sure. SEO, search engine optimization, is a practice of trying to improve your ranking traditionally in search results, but in wider areas of content so that it gets visibility and people engage with it. Right? Because we all know people don't turn mostly past the first page of search ranking results. And as I know you know, this divides into what are called relatively good practices and bad practices, sometimes referred to as white hat–in other words, everyone does this to try and be effective–and blackhat, which is nefarious 'don't do this'.
What that sums up is a cat-and-mouse game between marketers and agencies and the platforms, because the platforms are concerned to ensure the integrity and quality of search results because they depend on that trust and therefore want to move some of these black practices off to the margins, if not get rid of them entirely.
But we should remember, of course, these platforms are not just there to serve the consumer. They're there to generate ad revenue. And some of the tensions that play out in that space are important to note, too.
But I'd say for me, again, there's a whole literature on how to do search engine optimization and if you were teaching people how to be marketers, I'd certainly say they need to understand that.
One of the bigger concerns for me is about awareness. How aware are consumers of things like sponsored search results? There was some really important research done by the UK regulator for communications, Ofcom, which looked at young people and found that a majority of them couldn't recognize the difference between sponsored listings and so-called organic ones. Only a third of young people aged 12 to 15, for example, knew which search results on Google were sponsored, were adverts, or organic. That's a really, I think, important issue and an ongoing issue.
Mike: Yeah, especially when it comes to children. Let's dig a little deeper into SEO. What kind of techniques do content producers both in media and advertising use to boost their search engine results?
Jonathan: Oh, wow. There's a lot of terms and some great names out there to describe some of this stuff: keyword stuffing, cloaking, bait and switch. What they really have in common is artificially enhancing the value of your content without the intrinsic worth and value that would come from people's clicks and engagement. Okay? So there are a whole series from mildly artificial through to downright criminal and exploitative means to do it. One of the more serious, for example, is this great term brandjacking, where someone acquires or otherwise assumes the online identity of a brand for the purposes of inquiring their followers, their brand equity as they say.
Mike: It can be less than that too. It can just be, for instance, putting a brand's name as one of your keywords in paid search. That's brand jacking too.
Jonathan: Exactly, Yeah, exactly.
Mike: Yeah. So keyword stuffing, this idea of throwing search terms into content. One other thing though that bothers me a little bit where I work is the way that we go after keywords. The content that we write is pretty much exclusively based on whether there is search for it. And so as a result–I guess in the aggregate–you end up with huge patches of knowledge that just are not covered by free media.
Jonathan: Yeah, I agree. I think one of the fundamental questions here is, "What about brand voice in a world where that voice comes with resources that are not widely shared?" Right? In order to be a marketer, you have resources of money. And money buys you the chance to speak. Not everyone in our world gets the chance to speak and be heard, but brands can do it through their money.
Now, of course there are small brands, there are radical organizations who advertise. But we also know that the concentration of voice is often in the hands of the concentration of wealth. Which means some people, some brands, some interests, some ideas get privileged over others. And that is a really fundamental concern and it drives, for me, this issue of saying, "Well, what's the settlement for society between communications and brands?"
In the old world, I mentioned the 20th century, we had some settlements. We had some rules which said, "We're going to really make sure that you know this is an advert and we're going to keep some controls on where advertising appears and how much appears and what's advertised."
And the digital age is throwing up challenges all the time because new spaces, new opp,ortunities emerge for brands. And the rules are often some way behind. So those are the, kind of fundamental issues. I think voice is a really good term to use to get into that.
Mike: Right. So in addition to the black hat and white hat, there are gray hat techniques which kind of straddle the boundaries of marketing ethics. One example is the subject of your book, which is native ads, sponsored content, advertorials. So, what are these? What is sponsored content? We've talked about it a bit, we haven't really defined it.
Jonathan: Sure. Well, lots of different forms. But what's common to a lot of the forms I examined is in the way the industry would describe it, that the advertising is blended into the media environment in which it appears. Okay? The advertising is integrated and blended in.
And I think a good way in is–building on what I was just saying to you, really–is to start by asking some questions about payment and control. Those are really key elements in tracking this story.
In the old world, we had advertorials in newspapers and magazines. We still do, of course, but they're a feature of the old world. And the brand paid and controlled the content. It was an ad, but it was an ad that started to blend in to its surroundings.
But what's happened in the digital age is that's taken off across all media. So we have native advertising as a term for adverts, which are also paid for and controlled by the brand, but are coming into your newsfeed on mobile social media and so on.
Then we have sponsored content. And here, things get a bit more complicated because these questions of payment and control get widened. Because sometimes the brand pays and controls, sometimes the brand pays and the media, the publisher, or an influencer for example says, "No, we control the content." And sometimes it's a blend of both.
And fundamentally across that spectrum, we don't have clear and consistent labeling that is readily understood by people to know exactly what's happening here. So we don't always know when a brand paid and shaped content in this space, and that's a fundamental problem.
Sorry, but can I just put in–I don't know if this will be helpful or not-- but an example I was going to give from the UK is that we have a London paper called The Evening Standard. And an investigation by an online publication, openDemocracy, discovered that Syngenta, which is a US agribusiness firm, was paying for favorable editorial in that newspaper. But those stories weren't being clearly labeled as paid for and sponsored by Syngenta. And obviously, that's a big deal because Syngenta was at the time being sued by a large number of American farmers, which of course didn't feature in this more positive coverage.
So here we have some problems of labeling and identifying content, we have some problems of what kind of story gets shown, but we also have an issue which goes to the heart of this where the brand could pay but the publication could say, "No, we're in control. So we don't have to label that as an ad."
Mike: Right. And there's also the other problem of advertisers' control over media in general, where if there's an unfavorable story they could have it pulled. And we've seen instances of this, too.
Jonathan: Yeah, it's funny. And just to share with you, sometimes when you're talking to students particularly as a professor, it's good to show them that you may make mistakes, too. So I shared the fact that, you know, I'm in a tradition which has seen advertiser influence on the media as essentially a negative force, right? And looked at, kind of, "Well, when does this happen? And how does it happen? And how is it resisted?" You know, sometimes it's resisted because journalists say, "We're not going to have it."
Chrysler company told American magazine editors it wanted to be told when they were putting its ad next to content it thought was controversial. The American Society of Magazine Editors said, "We're not doing that. We stand up for free media." So, those kinds of stories.
But I said to the students I have to update this. Because we're in an era where advertisers are using their power and clout, sometimes for positive and progressive ends–ends that many of you might agree with. So you know, Unilever doing an ad ban on Facebook. The current ban or semi-ban, if you like, in which one of these major holding companies Omnicom is, quote, "Advising its clients,” so it's not quite a ban, but it's advice, “not to advertise on Twitter because look what Musk is doing, who knows how this is going to play out." So in its language, it's concerned with brand safety. It's advising marketers to produce a boycott.
So what I'm saying is I come from a tradition which sees advertising influence as negative. You could argue and it's important to recognize there's some positive things happening in these stories, brands doing good, right? Calling out hate speech and racism and xenophobia.
That story, of course, isn't just because those brands are angelic. It's because they've been put under powerful pressure from campaigns, from #StopHateForProfit in the US, Sleeping Giants, we have Stop Funding Hate in the UK. ANd also, frankly there's still a problem. Because however good they do, they still have enormous power and they can still use it in unaccountable ways. But anyway, there's a story that just acknowledges that it's sometimes complicated.
Mike: So native advertisement's gone beyond traditional news media in the digital age. Where else do we find sponsored content?
Jonathan: Well, we find it right across what we could call audio-visual. We've had a long history of product placement in films and television programs but, you know, there's some big questions about where that's going next. Amazon is a company that sells things, but it's chock full of audiovisual content, sponsored brand videos, and so on. So as this world evolves, as we get Amazon's Alexa and audio marketing, we're going to have more and more content in which there's a brand role and a brand presence.
Another big example is the Beta Verses. I was at a recent conference with advertising lawyers and they were kind of half-jokingly saying, "What's going to happen in this world? Are people going to walk around in T-shirts with #AdOn if it's sponsored? How is the brand presence going to be seen and identified?"
And again just on this, I'd like to go back to something that was written in 1966. The code of the International Chamber of Commerce is kind of the big international code, the self-regulatory code for marketers. And it said, at the time, "Advertisements should be clearly distinguishable as such, whatever their form and whatever the medium used." Again, I like to share with you and my students, that's great language. That includes TikTok. It was written in 1966. It's really clear what it's asking for.
And it went on to say, "When published into medium post that also contains news and editorial opinion, an advertisement should be so presented that the consumer can readily distinguish it from editorial matter." That's interesting because it didn't even need to add that second sentence. It's just indicating that it really underscores the importance in some of our media like news and editorial that it really matters that we can trust the content and it's not an ad. That was 1966, I don't think that describes the world today, I don't think that rule even in its current form holds, but it does exist to call on.
Mike: Yeah, I know. We now have companies that are flooding their own reviews with positive reviews to boost their rankings on Google and stuff. I do want to talk about something that skeeves me out in what I do, and that's ad retargeting. So, what is ad retargeting?
Jonathan: Retargeting ads are a form of online targeted advertising that is served to people because they visited a particular website.
We all know this, you kind of go to a website, look at a pair of shoes, go on to some other websites, and you're being flooded by adverts for those shoes. What on earth is going on? And the answer has been third-party cookies.
So to introduce another term, cookies are bits of data that get put onto your browser, so they can then follow you as you move around the rest of the internet. And those so-called third-party cookies are sold for advertising purposes; they build up a profile of you so that you can be advertised to.
And that's essentially what's gone on in retargeting. Now, the world of cookies is undergoing a change at the moment, which is interesting. But all your listeners will know this experience, as you say, of ad targeting. And it's still very much present in our experience of the internet.
Mike: Yeah. So basically the cookies originally were intended, as I understood it, to allow websites to remember what you have, like in your shopping cart on digital marketing or on a digital storefront. And they kind of morphed into this weird thing where they can now track you across the Internet and add things to your profile so they have more and more information about you. Okay.
Jonathan: Yeah. Well, there's an important difference, Mike. The first type you're talking about is called first-party cookies. And the important thing is, again, many of your listeners will say, "Actually, some of what they provide is quite helpful to me." You know, you go to a website, you put something in a shopping basket, you don't want to pay for it. But when you come back to that site, it's still in your shopping basket, right? That's a cookie that's controlled by the website itself. And often, frankly that can be a help to us. It's still collecting data. It still raises privacy issues.But it's often helpful.
Third-party is different. For example, you go to a publisher who signed up to Google's AdSense. You go there because you want to read a story, but what gets put onto your browser is a third-party cookie. And that is being used to sell advertising to reach you.
Mike: The third party being AdSense, right?
Jonathan: Yeah.
Mike: Okay. So let's talk a little bit about market research. How have market research techniques advanced in the digital age?
Jonathan: I mentioned there’s this challenge to third-party cookies. And that's been driven by a number of factors. It's been driven partly because with more use of mobile, people are on different devices, it's harder to track them. It's been driven by privacy pressures which have led to important new regulation, particularly for us in Europe. And I'd say that from the UK, we don't know exactly what's going to happen next. In fact, we have a government that's probably going to relax rules that apply in Europe.
But from 2018, Europe said, "You need permission to collect cookies." And there was a really deep intake of breath across the advertising and marketing and platform industry saying, "This is going to destroy the model of internet advertising."
So you need permission, and we have strong rules now that demand it. As I understand it in the US, there's no federal-level regulation. But there are states–California is an example–which have brought in new rules for consent to kind of strengthen privacy and protection.
So, third-party cookies are on the slide. And to answer your question about data, one of the things that is becoming more and more important is so-called first-party data. So companies, brands are collecting as much material as they can about their customers so that they can market to them. So we're seeing a huge industry growing up around digital data in the areas of customer data, financial data, and operational data.
Mike: In addition to collecting their own market research data, businesses can also pay for data. So, what kind of marketing data are businesses and ad agencies buying?
Jonathan: What marketers are interested, as I say, in customer, financial, operational, derive from different sources. So yeah, they're buying up to create a richer tapestry of their clients and potential clients from their own data first party and from third-party data. And we're seeing the whole ecology of advertising and marketing and media changing with the growth of these firms that are basically data harvesters and data brokers.
Mike: And are advertisers the only one that are buying these data.
Jonathan: Certainly not. Political movements and organizations who want richer data on consumers to target them are also absolutely buying up this data too.
Mike: Okay, so now I think we’ve discussed is everything you’d need to know to understand how the Cambridge Analytica scandal worked. So let’s talk about it. So unlike the UK, the US did not have widely publicized hearings regarding Cambridge Analytica, so a lot of my US audience will probably be unfamiliar with what happened. So before we get into the details of how the scandal worked, big picture, what was the Cambridge Analytica scandal?
Jonathan: Well, I like to think of this as kind of a bundle of scandals actually because it involved failures across quite a range of organizations. Cambridge Analytica, this company that gathered and used data and sold it on to political campaigns, but other players too. I mean, it's one of the biggest scandals for Facebook.
So essentially what happens–and this as a practice goes back to 2015–is a Cambridge-based researcher puts out an app which collects the data on US Facebook users. But not just them–the people who willingly took part–it accesses the profiles of all their friends and family. So in the end, data on about 87 million Americans–about a quarter of the whole Facebook audience in the US–were collected.
Mike: Can you describe the app that they put out?
Jonathan: Yeah. Sure, Mike. The researcher was called Aleksandr Kogan, and he put out an app called This Is Your Digital Life. It was a psychological profile app in June 2014. Either way, one group that comes out reasonably good from this story and I'm particularly proud of this or pleased about this because it is close to my heart, was the Ethics Committee at Cambridge University, because that rejected an application by this academic and also made the damning judgment that Facebook's approach to consent fell far below the ethical expectations of the university. In other words, it was deeply unimpressed with Facebook's provision. But of course having said that, we could say Cambridge University has questions to answer because this was still an academic who undertook this work.
So it was an app, people who took part gave consent, but they didn't give consent for their entire network to be data scraped in this way. The crucial thing about the scandal is that data was then used and sold on to right-wing politicians in the US in various forms, to Ted Cruz for his presidential campaign, and later for Donald Trump, because it produced rich, detailed profiles of American voters, which allowed micro-targeting.
And we've seen this more and more, but it's a kind of early example of what kinds of micro targeting can be done. In other words, you identify a voter who's going to be particularly triggered by rights to own and carry a gun, for example, but you trigger a different message to a different voter to mobilize them. And often those messages can be actually flat contradiction that can be at odds, but it doesn't matter. It's whatever works to build your political coalition.
I think the other thing just to highlight from this is this is often framed as a digital story, but it's older and broader than that. It's about power and money. We've had lots of lobbyists who engage in political campaigns and, again, we might all agree it's okay to promote your candidate and do marketing techniques. But it's not okay to do the dark arts of demolishing a candidate through fake news and misinformation, for example.
Some of your listeners might be interested; I'm in the UK, I have a great shoutout for the Channel 4 News, a public service news channel which did amongst other things, an undercover investigation in which executives from Cambridge Analytica are sort of bragging, because they don't think they're being filmed, about how they've intervened in democratic elections. It's a deeply disturbing portrait of how money and power can be used to undermine democratic processes.
Mike: Okay. And Cambridge Analytica wouldn’t have been nearly as successful with what they did without the plethora of right-wing content farms pumping out slanted and misleading news content. Talk about the online ecosystem that existed in 2015-2016 that allowed these websites to thrive.
Jonathan: Yeah, one kind of crystallizing example, again some of your listeners will remember, was an infamous example of a Russian organization called the Internet Research Agency, which spent thousands of dollars on social media ads and promoted posts in an effort to influence the US elections in 2016. So misinformation, fake authors, pretending to be Texans when you're actually in a content farm as part of the kind of quasi-state corporate world of Russia.
How did that all happen? It partly happens because of the deeper logics and business models of the internet, right? You know, promoting controversy and hate, driving traffic and engagement. It happened because of lax rules on who's the source and sponsor of marketing messages. Lots of things caused it but yeah, that was the ecosystem at the time.
And I think, again, before we just jump to the digital, this happens because of money. And so much of the right which can often appear to be kind of grassroots is, as we know, funded by very rich corporate donors who often don't like to be particularly transparent about who they are and how they operate. And the left progressive forces, which are more rooted in popular movements, in the end have less resource. We don't have the power of capital. We have the power of trade unions and collective work, but relatively weakly resourced. And that's a key issue.
Mike: And the content farming, it wasn't just from the Russian state, it was also private sector too. I mean, there was money to be made here. So can you talk a bit about how that was profitable?
Jonathan: Yeah. Well, if you generate clicks, if you produce clickbait, then the algorithmic world recognizes success at the levels of engagement and eyeballs, and that can be monetized. We should remember that's often not the primary motivation for political campaigns, it was information, disinformation, and mobilizing people to vote for candidates.
But yeah, there's an economy built around it as well which meant advertisers became very aware that they were often not choosing to support right wing publications because of the way the algorithms were driving traffic towards popular and shared content. And that's one of the reasons we saw the first wave, if you like, of boycotts and withdrawals from big brands like– big companies, rather, like Unilever who were being advised that their brand safety was being compromised by the sites that were appearing on and that many of their consumers were deeply unhappy about hate speech being connected with their advertising and advertising dollars.
Mike: Yeah. So one of the things that happened too as a result of these boycotts was that major social media and search platforms kind of reformed their algorithms to try to suppress this misinformation from proliferating. So, how has the digital media landscape changed since the 2016 presidential election and since Brexit?
Jonathan: Well, as I say, I think we should recognize that it's often been civil society power, political power, these campaigns that have forced marketers to divest. This hasn't just come from corporate voices; it's come from popular campaigns which absolutely deserve recognition.
But as I say, I think marketers using their power for good is all well and good, if you like, but it's still an exercise in a marketer's power. And that power is ultimately private and in my view, unaccountable.
I mean, a defender would say, "What are you talking about? The market decides that consumers don't like it. That's a powerful force on brands." To which you could say, "Well, consumer power does matter." Right? Ad blocking is a really good example of consumer power in this world. But consumer power is dispersed, it's not concentrated. And it's not sufficient very often to challenge corporate power and interests.
So these are all arguments, essentially, for a much stronger public regulation of communications because it shouldn't be left to private power to regulate itself. But nor, however important it is, can we rely on consumers only, you know?
Like other people, I believe in the importance of media literacy and better education so we can find our way through this world and decode it, but I also don't think the burden of responsibility should lie on consumers. It should be a principle. If you're big and you're in a communications space, then you act responsibly, and public regulation is the only way to kind of underpin that that is actually done. Relying on self-regulation from powerful forces in this world is not enough.
Mike: Yeah. Especially when the advertising techniques are constantly changing and evolving, you can't expect consumers to be privy to new ways of reaching them. So we've talked about various advertising techniques, let's talk a bit about their social implications. What are the consequences we're seeing from the proliferation of owned media?
Jonathan: Sure. Well, I like to sum up the whole world of what I call branded content around three problem areas. The first key problem area is around consumer awareness–this principle that we should know when we're being sold to. And that gets the lion's share of attention, actually, from all parties to the discussion. And that's important. It's about labeling and disclosure and identification. But I argue that that attention tends to displace two others.
The second big area of concern is around the quality and integrity of the media. I don't think there's enough people in this world who are speaking up for the importance of having media spaces that are free from commercial influence and interference. So that's the second area.
And then the third area, which I think is really where the radical voices come in, where the critical tradition I’m part of comes in, is this notion of marketer's power of voice. You know, the significance of a world in which the ability to pay can give you a louder voice. It's not to say we can wish that away, but it is to say that it's a way of thinking about historically that societies have put limits on that. They've said, "This is where advertising can appear. This is how it can appear."
And I think we need a conversation about what those rules should be for the 21st century because at the moment, we're in a bit of a hybrid of old rules that are weak and don't work, and new spaces that are opening up. So for me, that's the call of my book, really, to say, "These are deep problems. This isn't just about surface-level techniques; this isn't just about new tools in the marketing toolbox. This is a much more deep reconfiguration of the space between commercial voices, advertising, and communication space, and we need to work out what the rule should be.
I put a call in for saying we really need to have a discussion about what a 21st century version of separation–keeping media and advertising apart–would look like. And I say that because of course we can't put it all back in the box, we can't come up with a solution that would have worked in 1960 and say that's going to do it. It isn't going to do it. But I think that's a really key discussion to be had. Where should we be seeking a world which is free or freer from commercial influence and interference? How are we going to create that? How should it be configured and organized?
Mike: Yeah. Going back to owned media, I mean, the owned media dominates search results now. It's basically impossible to look something up online unless you're finding it through Wikipedia without having to use corporate blogs. And there's always a limitation to that, right? There's always a wall where they will not give you more information than is necessary to hook you to their services, right?
When I farm out my content to freelancers, I actually specifically instruct them that the reader should come away knowing what to do, but not how to do it. And so there's a technique to writing instructional articles that make you feel more helpless, and that's definitely what we aim for in our copy, which I take particular pleasure in making business owners feel helpless and so on and whatever. So let's talk about native.
Jonathan: Can I just say, I think that's such an important point and I agree entirely, and it shows that, kind of, you know, this isn't a simple change where we can easily identify the before and after. What you're describing is a kind of world where more and more content comes from an interested party and is underpinned by money and monetizing it as a driver.
And we know historically we've relied on content to come from other quarters, right? I'm very proud to work in a university world because that's a world that defends the idea of, "Well, actually we should ask questions that are important for society, not the sponsor, not the company." So that's one side.
We've traditionally had media in various traditions, you know, a free press in the US standing up for the idea of independent and impartial, know the advertisers can't call the tune because then we lose something really precious and what it means to do journalism. And all of those alternative sites are weak because for me, this all comes down to these questions of resource, money and power as a way in, so they have relatively less. What are we going to do about it?
Well, in Europe some of us defend and advocate for public service media, but also for new forms of public service community media, non-profit, hyperlocal, because those are really important spaces where that other content gets produced.
I don't know about you, sometimes it's depressing that we don't link up the networks more effectively. Why don't we have publications that pull together all the non-governmental organizations and civil society groups who are producing great content but can't always get it out to wide audiences? We don't have a very great tradition of connecting the content with the vehicle to promote it amongst, if you like, the left and progressive causes. But plenty of people are thinking about how to do it.
And yeah, absolutely, it comes through to other solutions. We need to defend and extend public media–what I call in Europe, public service media. And do that in new ways, too, because some of the old ways have been– Well, PBS in the States and all the problems of corporate funding kind of shrinking what gets said in that space, so a lot to fix too. But I think that's a really important part of the solution. We need non-commercial media, and have to work out how to support and develop it to create that kind of other kinds of information.
Mike: So by that same token, open-access journals I think are also really important, too. The fact that so much media now is putting up paywalls, all these academic journals are charging $30-$40 to rent an article, and there's just really no way to get free information that isn't paid for in some way. So let's talk about native. What is the effect of sponsored content on the public?
Jonathan: Let me answer that by an example I show my students, which is an Exxon advertorial in the New York Times. Exxon paid for an editorial which said, "Guess what? The solution to the climate crisis isn't the removal of fossil fuels. It's smarter use of our assets." That sums up for me some of the greatest dangers, which is sponsored content amplifies voices who can speak with partiality because they're advocating for themselves, but undermines independent journalism in the process.
To give another example, Facebook, as you know, has paid huge sums into lobbying and influencing politicians in Europe because it senses danger, right? Europe has created some quite strong rules on data privacy and on cookies as we discussed earlier. Facebook took out 20 ad-sponsored content items in the British newspaper, The Daily Telegraph.
So it sets up stories with charity bosses who say Facebook is great without disclosing that they're financed by Facebook. It has people saying what great things it's doing to kind of cut content, even though it's been pushed out just after the Christchurch massacre, which of course was relayed for hours on Facebook and other social platforms before it was taken down.
That's the problem with sponsored content, it strengthens and amplifies voices. And of course there are other problems; it's disguised; it's hidden; people aren't aware of it. We should know who the source of our content is.
In fact, just be interested to talk to you because you're working in journalism. I think one of the things I grapple with but would really like to see more debate out is about the disclosure of sources. Now, I know from the Human Rights tradition and so on the absolute importance of protecting a journalist's sources. Because we don't get good stories if journalists can't protect whistleblowers and others.
But we need something which protects that important public interest right. That gives readers better guidance to what the provenance, you know, what's behind the story. We could have ingredients in food and drink, but what were the sources? And in particular, we definitely need to know when there's been a paid source underlying a piece of content.
So what drives me in that debate is one of the things that happened in the UK was we had a debate about political advertising on Facebook, which said we should be told better when there are political advertising. But that was running alongside another debate about how to save the British press, which was saying let's have more native advertising.
So we've had contradictions and gaps in the way these issues have been treated. And I think we should recognize what's happening underneath, which is we don't always know the interests and sources behind our content. And we should do. Particularly when it's either a political voice or a commercial voice.
Mike: Yeah. And I want to give a shoutout here to Corey Pein and his book, Live Work Work Work Die, where he talks about how the tech world typically, they don't really concern themselves with following rules and regulations. They just kind of do what they do and then just once regulators catch up to them, they hope they've made enough money where the fines or penalties or whatever is insignificant to how much profits they've made.
And we see that with what happened with Facebook and I guess Twitter to some extent where they weren't regulating political advertisements at all. At least in the United States, political advertising has certain rules for financing and stuff that you have to report it and stuff like that.
And so in the 2016 election, that was just out the window. And that's been fixed. Facebook now requires that political advertisements are registered as such, and they only get served in certain ways.
All right, so there are regulations in place regarding advertising. What safeguards exist to protect the public from nefarious advertisers?
Jonathan: I think just to respond to what you were saying, these are kind of almost the deeper myths, the deeper stories that have been told. The story that internet innovation was somehow kind of natural, inescapable, has-to-be-done-this-way. You want change and all these great services, this is what comes with it. It's going to be driven in these ways, we're going to move fast, we're going to trip over the old rules.
I don't know about you, I think that is a myth in the making and it doesn't stack up, and it's already fragmenting and under pressure. So when Facebook's Mark Zuckerberg gets into US hearings in the likes of Cambridge Analytica, he has to say something different at that point. He has to say we do stand up for privacy and consumer protection. The problem is he doesn't fully deliver, and perhaps the bigger problem is the grand-sounding statements are there to reassure investors and markets and other stakeholders, but behind the scenes, Facebook carries on paying millions into lobbyists who go and influence politicians to make sure the rules are kept as weak as possible.
So that would be my summary. In the space that I've looked at, native advertising and so on, we see a kind of mixed progress. So just taking the United States, 2015 Federal Trade Commission comes in with new rules and guidance on native advertising. And the rules are certainly an improvement: they're sharper; they're clearer.
But what happens? Compliance by the industry remains low. Some early studies found 70% of marketers within I think a year of the new guidance weren't compliant. It got a bit better. But all the latest studies show right across publishing or influencer marketing, there's a compliance problem.
There's that lobbying problem I mentioned. So the big marketers say, "Yes, we want to be responsible and transparent, it's in our interests that consumers know they've got ads." But actually then go and lobby. And the kind of thing they lobby over is to say, "Leave it to us what the disclosures should be."
So what happens is consumer awareness is very low. Lots of the academic studies in this area have found awareness rates of about 10%, right? People being able to fully identify ad-sponsored content in news publications, for example. And it remains very low. So these industry people are kind of saying, "Well, leave it to us. We need to be fitting for the platform." And the result is consumers have low awareness and are confused. And people like me in this debate and in my book say, "We should call this out. We should have– If the objective really was consumer awareness, then we should move to clearer and more consistent labeling." And why I perfectly accept Instagram and Facebook are not the same thing and TikTok is not the same thing, if we had much more consistent labeling, we'd be in a better place.
So one of the things I've argued for in Europe, for example, when we have product placement on television, unlike in the US it has to show a sign–a P sign to tell you that there's product placement. And not just at the end of programs as you're used to where the credits roll very quickly, but before and after each ad break.
So why don't we have a sign, a hashtag ad, or a B sign for branded content across all branded material? I think that's an important argument to have because I think we're going into a world which is going to become even less recognizable as these new forms and formats emerge.
Mike: Okay, so we've talked about some of them already, but what kind of policy gaps do you see with respect to marketing and media? And what do you think we should do to patch them?
Jonathan: Well, I must just say it's a lovely time to speak to you and your audience about this because we've just started–I'm very proud of this–a three year research project which is looking into the rules and regulation of branded content. So we have what's called a Branded Content Governance Project and we're looking at the United States, Canada, Mexico, the UK, every country in the European Union, and Australia to kind of track what the rules are and what we can learn from that to do better.
When I map this, I see the forces sitting in four areas. There's regulation, public regulation. There's industry self-regulation, when it makes its own rules. There's the power of the market, ad blocking, for example. And there's the power of civil society arguing for better.
And I think we're at a point where self-regulation by the industry is failing. And that's becoming recognized not just by activists if you like, but by governments too. So we need a new settlement. And I think that needs a strengthening of public regulation as I've outlined. But I think all the elements need to work together. And that means putting pressure on companies to actually do as they say and strengthen their own self-regulation.
Mike: Okay. Let's talk a bit about the stakes. So given the current digital landscape, what do you see the internet looking like if policy does not catch up with advertisers?
Jonathan: Yeah. Well, that's a great question. Pretty chastening one, isn't it? There's a famous moment in 1994 where the chairman of Procter & Gamble, Edward Harnes, gets up and does a speech to the American Association of Advertising Agencies. And it basically says, "Hold your nerve. Things are happening, digitalization is about to happen. You could get slaughtered. The digital world could help people bypass ads and evade them. But if you keep your nerve, you can dominate this space."
And I don't know about you, Mike, but I feel he was right. [chuckles] We knew this was happening in the early internet, the commercialization of the internet. But that corporate model and that corporate dominance is dominant. It's strong. However, I think we always need to look for sources of hope. And if it's dominant, it's also contested. There are forces challenging it, whether those forces are kind of carving out space for public media as we discussed, or whether like I am with others, we're kind of arguing for the rules to be improved on behalf of consumers and society.
So I think we're losing, but classic Gramscian and optimism of the will is required. And to recognise all the things that are being done to highlight the problem and think through solutions. Whether that's very local ones like– I mean, something we haven't mentioned I think is very important is kitemarking, right? Small publications, non-profit or low profit saying, “We're going to signal what standards are to readers." And that's good for the publication but I think it also is good for awareness. It says, "Well, yeah, why is this publication different from these other commercial ones?" Because this is how it engages with advertisers. So I think that's all really important, too.
Mike: All right. Well, cool. Well, hopefully, we can save the internet. Thanks, Dr. Hardy, for coming onto the Nazi Lies Podcast to talk about the lying press. The book again is Branded Content out from Routledge. Thanks again, Dr. Hardy.
Jonathan: Thank you.
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