Experts on labelling of online advertising: ‘The market is already going through difficult times!’

Tougher requirements for advertising on the Internet will cause a reduction in the market and the withdrawal of businesses into the shadows, experts say

Experts on labelling of online advertising: ‘The market is already going through difficult times!’

The majority of experts called the amendments to the law “On Advertising”, which comes into force this autumn, a negative innovation not in the best times for the advertising market. Requirements are being introduced for labelling all commercial information on the Internet and specifying advertisers, which will entail the transformation of the industry: “some of the players will leave, some of the budgets will be cut or redistributed to other tools”. The requirements of the law will be mandatory for most participants of the advertising market. Read more about their reaction and upcoming changes in the material of Realnoe Vremya.

All information is included in a single advertising accounting system

Amendments to the federal law “On Advertising” come into force on September 1. From this date, all advertising distributors, advertisers and advertising system operators will be required to submit information to the advertising accounting system, which was created by Roskomnadzor. The information will be stored in the department for up to 5 years, and other state bodies of the Federal Antimonopoly Service, the Federal Tax Service and so on will have access it.

In accordance with the government order, it will be necessary to provide detailed information about advertisers, advertising distributors and operators of advertising systems to Roskomnadzor — from INN (taxpayer ID number — editor's note) to information about the information system used for advertising distribution. Besides, the supervisory authority should receive information about the advertisment itself, including a description of the object of advertising, information about the form and volume of advertising distribution, as well as the content of advertising contracts, including price information.

It is necessary to transmit information to Roskomnadzor, regardless of the method of referral, within one month following the calendar month in which the relevant advertising materials are distributed. If the information is incomplete, untrue, outdated or provided late, market participants will face penalties. Most likely, they will be brought to administrative responsibility under the clause 1 of the Article 14.3 of the Administrative Code of the Russian Federation. For citizens, the amount of the fine varies from 2 thousand to 2.5 thousand rubles, for officials — from 4 thousand to 20 thousand rubles, and for legal entities, non-compliance with the law can cost from 100 thousand to 500 thousand rubles.

It is necessary to transmit information to Roskomnadzor within a month after the launch of the advertisement. Photo:

Amendments to the law will require serious material investments

Market participants reacted to the new requirements for advertising on the Internet mostly negatively. And most importantly, for many it is still unclear about the procedure and form of submitting information to Roskomnadzor. Besides, it is obvious that changes in the law will require serious material investments. According to the calculations of the Association for the Development of Interactive Advertising (ARIR), the total cost of implementing the new requirements may range from 10 to 20 billion rubles, and these costs will fall on market participants.

ARIR President Boris Omelnitsky noted that if the changes are implemented, an unreasonable additional burden will fall on the industry and suggested postponing the date of entry into force of the law. And this is despite that the advertising industry has suffered seriously due to the departure of major Western advertisers.

For many it is still unclear about the procedure and form of submitting information to Roskomnadzor. Photo:

“Market participants are rather hostages”

According to the director of Vivat advertising agency, Olga Glukhova, the sphere of online advertising is already undergoing difficulties, and new changes will further complicate the life of advertisers on the Web:

“It is not very clear at all how everything will be, in what way. Of course, on the one hand, the state wants to make everything transparent. On the other hand, digital advertising is already going through difficult times. Yandex is an ocean, VK doesn't really work yet, leads are expensive, algorithms don't work, and then there are these restrictions. And this transparency is somehow also not transparent, since at the moment there is no clear clarity in the application of this labelling.

“Market participants are rather hostages. A period of training and adaptation is needed. In general, they are complicating everything in already difficult times. We believe that this measure will change the market, some players will leave, some budgets will be cut or redistributed to other instruments. In general, the negative innovation is not at the best times for the advertising market," says Olga Glukhova.

The new law is intended to increase the transparency of the Internet advertising market, but only regulatory authorities benefit from the innovation so far, according to Natalia Ldinova, marketing expert, founder of WELL MEDIA advertising agency. The existing law on advertising, according to her, also works on the Internet, all advertising platforms comply with it, but it is much more difficult to track violations than in offline advertising.

“The rest of the market participants: advertisers, advertising distributors, advertising system operators will be required to rebuild business processes and, possibly, hire new employees. At the same time, it is still unclear what duties these people will perform. I really hope for understanding from the regulator and that they will not be held accountable during the adaptation period," Natalia Ldinova said.

“Perhaps, someone will prefer to switch to 'gray' work with bloggers”

Fragencu SMM agency also wonders how the innovations will be implemented in practice. It is possible that the obligation to transfer information to Roskomnadzor will be assigned to those platforms that will distribute advertising on the Network, otherwise advertising agencies will face serious problems.

“It is still completely unclear how the structure and interaction between customers, agencies, social networks and Roskomnadzor will be built. And it seems that you and I will find out exactly everything only in September, when the law starts working. Although it's nice that Roskomnadzor has started answering some specific questions now.

“If we talk specifically about social networks, now there are several official 'operators of the advertising system', as they are called in the law: VKontakte, Odnoklassniki, RuTube. We assume that they will take over the functionality of submitting information about advertisements to Roskomnadzor, including: legal information about the advertiser and the advertising distributor (that is, about an agency like ours), about the advertising goals, format, and so on," says the agency's founder, social media promotion expert Regina Faskheeva.

The interlocutor of the publication hopes that by September an appropriate section will appear in advertising offices where agencies set up targeted ads. Since the internal advertising verification tools of social networks are now working more than thoroughly. “It's another conversation if this responsibility is shifted to advertising agencies: then there will be great difficulties with registering each advertisement (we have several hundred of them monthly)," she added. “The general conclusion from the first acquaintance with the law is this: everything will be less flexible than it is now," concluded the agency's director Stanislav Shchepichak. “We will not be able to coordinate ads so quickly, and after all, it takes a considerable time to coordinate them with the customer and moderation in the social network.

Perhaps, some of the customers will prefer to switch from targeted to “gray” work with bloggers, if this law does not affect them. We do not exclude that we will need new specialists in the staff, for example, lawyers who will additionally check advertisements. While we are looking at how it will work in reality, maybe we can do it on our own.

Outdoor advertising businesses will only benefit from this law

While many advertising specialists on the Internet still do not understand how to adapt to the new laws, advertisers from related areas are anticipating an increase in the number of orders. According to Ilya Fomin, the head of RIM media group, the fast-growing Internet advertising market may reduce the growth rate and cede part of the income from the profits to outdoor advertising.

“The basis of our business is outdoor advertising, that is, advertising on billboards and so on. All these points about the indication of advertisers already exist there, and this is not a problem for us. This will even create more favourable conditions for us, because if the law makes it more difficult for an advertiser to advertise on the Internet, this advertiser can choose an alternative platform for his promotion, including outdoor advertising, respectively, part of the money will come to us. Our business, as an outdoor advertising operator, will not only not suffer from this law, but will even benefit," Ilya Fomin noted.
Emil Ziyangirov
Analytics Tatarstan
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