Ben Greenstone, the Director of Taso Advisory and former Private Secretary to the Minister for Digital and the Creative Industries, writes for Esports Insider as a monthly columnist. In this column, Greenstone breaks down the UK government’s recent proposal to initiate a total ban on the online advertising of high fat, sugar and salt products and how this could impact the esports industry.
Simply put, the UK Government is consulting on a total ban of online adverts for products high in fat, salt and sugar (HFSS).
The proposed ban comes as part of the Government’s obesity strategy and after the statement of intent to introduce a 9pm watershed on HFSS advertising both on television and online. The consultation is open for responses until the 22nd December 2020, with measures coming into force by the end of 2022.
Why is the ban being proposed?
In early 2019 the Government launched a consultation on further advertising restrictions for products high in fat, salt and sugar. That consultation closed in June 2019 and the Government is yet to publish its formal response.
The Government did, however, announce in their obesity strategy of July 2020 that they intend to ban HFSS adverts being shown on TV and online before 9pm. The Government has also said that it ‘wanted to go further online’. This consultation asks the questions of to what extent the Government wanted to go further, via a total ban of online advertising for HFSS products.
What’s in the consultation?
The consultation is clear that a total ban of HFSS advertising online is the Government’s preferred option.
Rationale
The broad aim is to reduce the HFSS advertising seen by people, and particularly by children (hence the 9pm watershed). The rationale for a total ban online is to ‘futureproof’ the policy against changing media habits, account for a lack of transparent and independent data, plus addressing issues with the way that adverts would be targeted away from children.
Scope
The consultation’s defined scope of online advertising is drawn about as broadly as it could be, covering search, in-game advertising, email marketing, advertorials and much more. It goes so far as to suggest that advertisers selling an HFSS product, or which are ‘synonymous with HFSS products’, should ensure that their own social media posts are only found by users ‘actively seeking them’.
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The consultation proposes exempting broadcast video on demand from this total ban because of new audience measurement of the same quality and dependability as linear television. If online advertising was able to offer sufficient comfort to the Government on measurement, it appears there would be room for a watershed rather than a total ban.
Enforcement
The consultation proposes a new ‘statutory backstop’ regulator to work alongside the Advertising Standards Authority. This statutory regulator would be able to levy fines and other civil sanctions for repeated breaches, as well as potentially being able to require evidence of compliance and processes from businesses in scope.
How will it impact esports businesses?
This is a potentially major regulatory shock for the revenue of businesses in and around esports. A few examples of the impact are below:
- Sponsorships of teams by HFSS brands (such as energy drinks) will not be able to include social content creation for social media or for their own websites.
- Publishers will not be able to include in-game adverts or branding for HFSS partners during tournaments.
- The advertising revenue directed towards online streaming platforms will decrease, which could lead to lower ad revenue for tournament broadcasts and teams into the future.
What’s next?
The consultation is open for responses until December 22nd. It will be an uphill battle for the industry considering the Government’s stated intent to go further and their naming of a total ban online as the preferred option.
But not responding leaves online advertising businesses, as well as businesses that advertise online, hugely exposed to a major regulatory event. Businesses that will be impacted should look to respond to the consultation with strong evidence and clear arguments.
Ben Greenstone is the Director of Taso Advisory. Taso Advisory supports clients with the political, policy, and regulatory challenges they face, and helps them to design and deliver credible responses to mitigate risks and seize opportunities. You can contact Taso Advisory via email: [email protected].