Augmented Reality: a new legal frontier for marketing?

Within the world of digital marketing, there is a (tentative) expectation that Virtual Reality (VR) and Augmented Reality (AR) products will open up new and exciting doors to advertisers in the not-so-distant future.

Readers may already be familiar with the virtual dealership created by Cadillac, or Snap’s AR lenses, which allow advertisers to superimpose three dimensional objects onto real-world scenes.

Warner Bros. is one of the first companies to take up this offering, allowing Snapchat users to bring the “Spinner” car from the new Blade Runner 2049 film into their world.

However, along with the opportunities that these technologies bring to advertisers, new challenges will inevitably follow. One important question to ask is: how will advertising regulations apply to these virtual or altered environments?

Do the current advertising rules apply to AR and VR?

In the UK, the Advertising Standards Authority (ASA) is the watchdog responsible for advertising compliance and for enforcing the Code of Non-broadcast Advertising and Direct & Promotional Marketing (CAP code).

AR and VR activities are not explicitly provided for within the CAP code

Whilst AR and VR activities are not explicitly provided for within the CAP code, it is likely such activities will be caught by the code as well as other consumer protection regulations.

In February 2017, the ASA published new guidance on "Electronic cigarette advertising prohibitions" which specifically lists "in-game advertisements (including AR and VR environments)" as one of the media channels in which advertisements featuring unlicensed nicotine-containing e-cigarettes are prohibited.

This clearly demonstrates that the ASA considers such activities to be within its remit.

What are the current rules?

With brands eager to engage with consumers in authentic, non-intrusive and natural ways, increased focus has been given in recent years to the need to distinguish between editorial content and advertising.

Through native advertising, social influencers and product placement, the ASA has had to consider how the technology-agnostic advertising regulations apply to the constantly-evolving, innovative ideas of brands and agencies.

advertisements must make clear their commercial content

Rule 2 of the CAP code requires that marketing communications (i.e. advertisements) are ‘obviously identifiable as such’.  It also states that advertisements must make clear their commercial content, if that is not obvious from the context. The basic rationale for these rules is that consumers should know when they’re being advertised to.

There is no hard-and-fast rule about how paid-for content should be identified, and the ASA has referred to the ‘technical quirks of each platform’ being relevant to the point at which a brand should identify an advertisement, and how they should do so.

The ASA has previously recommended that social influencers signify their commercial relationship with a particular brand by including ‘#ad’ to posts on Twitter, or an ‘ad’ identifier placed directly on top of an image on Instagram.

How might these rules be applied to AR and VR environments?

There is yet to be any specific guidance on how advertising regulations might apply to AR/VR experiences.

Just how explicit advertisers and AR/VR experience providers will have to make any paid-for content or product placement is likely to depend upon the type of experience being offered. In the same way that the Committees of Advertising Practice (CAP, which writes the CAP code) and the ASA had to evolve and adapt to accommodate for the explosion of social media brand engagement, they will similarly need to adapt for AR/VR.

However, inevitably there is a chicken and egg dilemma where CAP and the ASA will have to wait to see how brands decide to harness these technologies as well as the extent to which these technologies are welcomed by consumers.

most issues which are likely to arise in this space will be transparency

Until specific guidance and rulings are given on the use of these technologies for advertising purposes, brands should assume that the ASA will apply the same rules and standards that it has applied to any other form of advertising.

The key to most issues which are likely to arise in this space will be transparency. There will always be friction between a brand wanting their message to appear as fluidly and naturally as possible, and the ASA wanting to ensure that a consumer understands at the earliest possible stage that the message is promotional in nature.

In the Vlogger sphere, CAP has stated that an advertorial needs to be labelled upfront so that viewers are aware and understand that the content is paid-for/promotional, enabling the viewer to make an informed decision before they decide whether to engage with the content.

We consider it likely that an analogous approach will be taken in respect of so-called VR/AR experiences, meaning that content producers will need to flag to consumers at the earliest moment whether the content is paid-for or contains promotional messages.

It remains to be seen to what extent the industry will embrace this new technology but, given its particularly immersive nature, we can be sure that the ASA will be keeping a watchful eye.

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10 May 2018, 3:29 p.m.

I believe that augmented reality is a powerful marketing tool. There are many successful companies at the moment that use this technology in marketing -