“I get requests [to add links in exchange for compensation] almost every day and almost all the journalists I talked to reported the same.” This is what TechCrunch’s John Biggs wrote last month in connection with the reporting in the click-happy field of cryptocurrency. Breaker’s Corin Faife followed up this week, vouching for the pay-for-post practice after enacting an investigation with the Ben Schiller-founded technology site. “If these offers are out there, can we rely on all of the journalists and editors to turn them down?,” he questioned. “Can we believe in the objectivity of the coverage we see every day, or has it simply been paid for by a company flush with cash?”
According to Mr. Faife, some of the background on the specific crypto pay-for-play “endemic” is this: “Over the last decade, mainstream media has either ignored blockchain companies, or reduced blockchain coverage to a few brand name projects (bitcoin, Coinbase) or the most sensationalist elements (dark web, drugs, assassination markets).” With that in mind, “Honest blockchain companies often struggle to get attention in a media environment that is either hostile to crypto or disinterested—as a prime example, see Twitter, Google and Facebook’s ban on ICO ads earlier this year.”
“In the face of such obstacles to obtaining coverage in traditional media or on social networks,” Faife asserts that “paying for press releases or creating sponsored content has often made sense: for many companies, it’s been the only way to get the word out.”
In an attempt to uncover the extent to which media outlets are actively engaging in what Faife calls “the most glaring form of pay-for-play: where companies offer money for promotional coverage that’s disguised as objective reporting,” Breaker conducted a simple-enough experiment.
To be exact, the digital magazine’s editors created an admittedly “deceptive” fake identity and email account, claimed to be representing a PR company, and inquired about the “rate for advertising on” the various crypto reporting sites he reached out to. In a follow up email, Breaker’s faux “Moscow-based PR agent, Nikolay Kostarev” asked about to whether it would be possible that such sponsored content “not be marked [as] ‘Sponsored.’”
What Faife found as a result of his reconnaissance work was this: “Of the 22 outlets who replied conclusively, 12 of them—more than half the total—were willing to publish paid content without disclosing it as such.” And to be fair, “Only the websites that unambiguously offered to publish native content, unlabeled, for a price are included in the total.”
Of the crypto-reporting sites targeted by his investigation, Faife states: “Some are small, and don’t command much influence in the crypto sphere. Others are far more prominent, and are used as trusted news sources by many traders, investors, developers, and others with an interest in cryptocurrency.”
The practice of paying to induce use or coverage is hardly limited to the marketing of emerging digital assets, or any small number of industries, in fact. Pharmaceutical sales reps notoriously court doctors with oft-pricey perks in hopes to getting them to prescribe certain medications to patients. The music industry has long been dominated by payola, the now-illegal practice of record companies offering up compensation for the broadcast of recordings on commercial radio, without disclosure of that fact.
As Eugene Kan, the founder of audio-visual publication Maeken and a former Hypebeast senior editor, stated this week, “I'm certain crypto isn't the only media industry susceptible to this.” And he is right.
The fashion industry and the corresponding media has long been plagued by behind-the-scenes foul play.
One need not look further than the year’s most highly-watched red carpet events to find the products of the practice of brands paying for product placement, which is “prevalent across the board," celebrity stylist Jessica Paster revealed at the 2015 Vulture Fest. Such quiet deals “could just be [brands] paying the stylist and we get anywhere between $30,000 to $50,0000. Or it includes paying the actress something between $100,000 and $250,000,” she said.
Famed stylist Brad Goreski echoed this notion, stating, "If someone shows up to the Oscars in a black dress and huge statement necklace, chances are they're being paid by a jewelry company.” Pay-for-play when it comes to certain dresses, on the other hand, is often “hush-hush,” he says.
Compensation in exchange for coverage was highlighted recently in connection with the beauty industry, which is heavily saturated with brands, influencers, and big-money deals between them. This summer, influencer and beauty brand owner Marlena Stell revealed, “People only talk about the products of [the companies] that pay them the most.” Shortly thereafter, Emmy Award winning makeup artist Kevin James Bennett made headlines when he asserted that he was presented with rates of “$75K to $85K” in exchange for which an well-known influencer would provide “a dedicated negative review of a competitor's product (price determined by length of video).”
More often than not, these seemingly authentic endorsement posts are going undisclosed, i.e., they are devoid of the legally-required language to alter consumers to the compensation – or other “material connections” – that are going on behind the scenes. (As we have noted rather extensively in the past, the Federal Trade Commission requires the clear and conspicuous disclosure of “material connections.” Similar requirements are in place in other jurisdictions, as well).
Intriguingly enough, influencers largely found favor amongst consumers in response to the growing understanding that fashion’s most traditional media outlets were taking money, gifts, and other perks in exchange for featuring designers’ wares on their pages – and on their covers. This still runs rampant. As TFL revealed last year, big-name publications ranging from Hearst and Conde Nast-owned titles to digital sites like BoF were regularly (and in no small number of cases still are) accepting free travel, accommodations, gifts, and other perks for their editors/critics from brands in connection with far-flung runway pre-season and couture shows.
And beyond brands paying for publications’ many editors to attend (and cover) season-specific runway shows in various locales, gifts and money – either paid directly in exchange for articles or in the form of advertising dollars – tend to flow freely from brands to publications in fashion without any consistent disclosures by those publications, and so, the average consumer is none the wiser.
To Faife’s point, we cannot necessarily believe in the objectivity in all of the coverage we read, even from seemingly legitimate publications (many of which routinely post unpaid Op-Eds and contributor articles, which, in offering the writer exposure in exchange for an article at zero cost, often tend to be little more than (disclosure-less) “brand coverage disguised as journalism,” as Faife so aptly put it).
And because we cannot reasonably believe in the objectivity of the coverage we read, it is safe to assume that not small number of those articles you have been reading that tout the various initial coin offerings and currencies – or the success of certain brands or the appeal of their collections – have been paid for.