Reuters Reports Google Assistant Query Responses May Be Violating FTC Sponsorship Disclaimer Rules
Earlier this month, Reuters published a piece discussing whether Google Assistant responses to user queries are sponsored, specifically when asking for recommendations of local businesses. Voice assistant responses to user queries are generally believed to be free of sponsorship. Certain types of media, like news and Flash Briefings, do include advertising, but general queries do not. That’s why in late March when BMW advertisements began popping up when French users asked either Google Assistant or Alexa to play the news, it made headlines.
According to Reuters’ report, there is a Google Assistant feature that is very close to violating the Federal Trade Commission’s advertising disclosure rules. Reuters says that local home service providers recommended by Google Assistant come from a curated database mainly composed of companies that joined a Google marketing program.
Google Guarantee and Local Services
Local Services is a specialty tool that was adopted by Google Assistant in 2017. Local Services offers only vetted businesses when U.S. users search for domestic help, like plumbers, electricians, or locksmiths.
Google Assistant’s responses to user queries about household help come from Google Guarantee. The Google Guarantee program offers free membership and only accepts those who are licensed, insured, and clear of legal issues. The program will also refund customers up to $2,000 if one of their members makes a mistake on the job.
Although membership to Google Guarantee is free, businesses need its membership in order to buy Local Services search advertising from Google. Google also gets paid when its recommended businesses are contacted through advertising on its search engine. For clarification, this is why businesses receive the “Sponsored” or “Ad” label on traditional Google Web Search results pages.
The Federal Trade Commission requires search engines to inform users in a “noticeable and understandable” fashion when results are influenced by a financial relationship. Google Assistant is responding to queries with Google Guaranteed options but is not offering a disclaimer. Reuters contacted Michelle Cohen, an attorney with expertise in marketing rules at Ifrah Law in Washington, D.C.:
It’s not a completely clean recommendation. If there’s a financial commitment, you’re supposed to disclose it.
But if Google is Not Receiving Payment From Assistant’s Responses, is it Still A Violation? Advertising Attorneys Say Yes
The situation becomes sticky when you consider that businesses do not necessarily have to conduct a financial transaction in order to be included in Google Guarantee. Google has also said that Assistant’s responses are not labeled as ads “because Google isn’t paid for these results.” Reuters contacted several advertising attorneys about the situation. They said,
Users should be informed that Google Assistant results, even if not paid for, stem from a filtered database in which many businesses landed because they wanted to buy ads.
The FTC sent letters to Google and other top tech companies in 2013, stating that search services that “talk” to consumers are not exempt from “the long-standing principle of making advertising distinguishable.” Reuters says that according to results from a Freedom of Information Act request the FTC has not received complaints about ads on Google Assistant, which is something consumers will commonly do when concerned about potential violations. The FTC also declined to comment to Reuters on whether it is scrutinizing advertising through virtual assistants.
What do you think about the situation?