Online Native Advertising, in the Light of the Ban on Surreptitious Advertising

Abstract

This thesis is a study of the term “online native advertising”. The purpose of the thesis, is to analyze the legal and economic circumstances of how the parties in an online native advertising cooperation, are impacted by the law that apply, and further, how companies can strengthen their brand equity by using online native advertising, for a marketing strategy. The legal analysis, hereby gives the reader an understanding of the rules that apply to hidden advertising, in the Danish Marketing Practices Act, through the time, as the rules for hidden advertising have changed, and further the rule haven’t always existed. The changes of the Danish Marketing Practices Act have resulted in some changes for the parties’ legal position, involved in the online native advertising cooperation. The changes of the law through time, means that the parties can easier get prosecuted, when performing online native advertising. Further, the economic analysis gives the reader an understanding of the factors that should be taking into consideration in relation to the usage of online native advertising, in order to strengthen their brand equity, by applying Kellers CBBE-model for marketing. The factors in the CBBE-model has been set in contexts to a questionnaire survey, consisting of 10 respondents, in order to give an insight in which factors companies should weigh the most in marketing, and when using the CBBE-model for a strategy. Based on the legal and economic conclusion, the most socio-economically optimal has been derived. In this context, a battle of the sexes game has been lined up to give an insight in the parties preferred strategies, based on their highest achievable profit. Their profit that has been decided based on the legal and economic conclusion. The parties’ strategies in the game are based on the evolution of the rules about hidden advertising, in the Danish Marketing Practices Act. The most socio-economically has been proved through the criteria about Kaldor-Hicks in a judicial policy analysis. The analysis states, that the best outcome of the regulation for hidden advertising, for society, under the given circumstances, is to implement a requirement for agreement between the parties in the online native advertising cooperation, for the rules regarding hidden advertising to apply