Advertising Disguised as News: Does it Matter?


Is it ethical for a newspaper to publish advertising under the guise of news?


Does it matter?


Should a newspaper that’s been a stickler for ethics among its reporters, apply the same standards to its news execs?


What’s at issue here may seem a peccadillo--an article at the top of the front page of every Saturday’s real estate section called “Fantasy Home of the Week.” But trust is always a big deal in the news business. If your trust is betrayed in a small matter, you can’t help but wonder about larger ones. Further, ethical standards erode one rule at a time.


That, presumably, is why the Mercury has come down so hard on reporters for infractions that elsewhere might have merited only a warning. The paper has been protecting its credibility against any challenge.


A volume discount on integrity?


But major advertisers, such as the real estate industry or auto dealers, can wedge crowbars as big as their ad accounts under the slats of a news organization’s integrity. In times of falling ad revenues, the pressure can be difficult to resist; advertising contributes about  four times as much revenue to the Mercury’s bottom line as your subscription dollars.


Unlike the Sunday real estate section, which is clearly¾and ethically¾marked as an advertising supplement, the Saturday section is presented as news.


Among the first commandments of journalism is the obligation to clearly label advertising so that readers can distinguish it from news. No blurring the line. The reason is simple: when most people read ads, they erect defenses. They realize the copy is there to persuade rather than inform, that it might not be trustworthy.


You be the judge


You be the judge of whether the Mercury is slipping an unmarked ad into its news reporting.


Webster defines advertising as: “To make known; to call public attention to, especially by emphasizing desirable qualities so as to arouse a desire to buy or patronize.”


Here’s how a $25 million property was described on the first Saturday in September:


“The livestock fencing, three barns and Central Valley views do put you in mind of the Ewing place on the old “Dallas” TV show…. Even the Ewings would be envious of this set up…. The beauty is in the details….a heated tree house for the kids…. Pellets hitting the water announce feeding time for the fish, and young children can fish successfully from rowboats…. Lights adorn the gazebo and the snack bar making it a festive place…. On a clear day you can see Monterey.”


Here’s the description of an $8 million mansion on September’s final Saturday: “It’s not the elegance that excites you as you approach this ‘painted lady,’ a romantic lavender and cream-colored villa three short blocks from the ocean. It’s not the overwhelming size, nor the spire on top—the highest point in Santa Cruz. No it’s the tug of history that first lights a spark.”


Each article also contains most of the other usual elements of real estate advertising: the name and telephone number of the broker and agency, location of the property, numbers of bedrooms, baths, proximity to shopping, transportation, etc.


Differences between ads and news


Were this journalism, one might expect a more factual tone. And greater care with facts. The spire of the “painted lady” can’t possibly be the highest point in Santa Cruz. It barely reaches the elevation of the foundation of a half dozen churches higher on the hill, including Holy Cross with its landmark bell tower.


Journalism would concentrate on the consumer’s questions, rather than the real estate agent’s hyperbole. And it might choose properties more readers could afford. The average price of the five houses featured in September was $7.7 million, beyond the financial grasp of all but a tiny percentage of residents, even in wealthy Santa Clara County.


Were this journalism, the focus might be on an entire development or style of house. We don’t learn much about South Bay real estate when a story describes a single house. Perhaps the story is presented only as a light feature, a glimpse of houses you’ll never own. But why then does it make such an earnest effort to sell the property?


“Fantasy Home” differs from advertisements inside the real estate section only in three particulars: It’s free, written for the Mercury by a free-lancer. It’s neither labeled nor laid out as an advertisement. And it’s placed above the fold on the front page, a location the Mercury reserves for news alone.


Bob Steele, an ethicist at the Poynter Institute, a journalism think tank and training institution in Florida, says: “As you describe it, it does raise the concerns about the impact of such content on the credibility of the paper. Will readers see the Mercury as compromising journalistic independence? Will there be a perception by some that financial motivations are driving this content to the detriment of the paper’s editorial integrity?”


Phantom copy


“We used to call that ‘phantom copy’,” says Marquette University Professor Lawrence Soley. He has conducted several surveys measuring the pressures large advertisers put on print and broadcast newsrooms. “Essentially it’s a bonus ad,” he says. “Advertise with us and we’ll throw in phantom copy. It’s done very frequently by small weekly newspapers across the United States.”


“I’d say it’s neither news nor advertising,” responds “Fantasy Home” author, free-lance writer Katherine Clay. She says Mercury editors don’t tell her which properties to profile and that she’s not employed by the real estate industry.


Popular with Realtors


The feature has been a hit with real estate agents, she explains: “I’ve gotten just a flood of emails from Realtors with properties for sale….” They say it creates a big flurry [among potential buyers] right at the beginning. It seems to be creating a lot of interest.”


Asked how “Fantasy Home” differs from an advertisement, Business Editor David Satterfield responds: “I would say it would probably differ not a whole hell of a lot. Because it is geared to very high-end homes, kind of a ‘Lifestyles of the Rich and Famous,’ there’s a prurient interest that people have. It’s not hard-hitting journalism, that’s for sure.”


Mr. Satterfield, whose department supervises the real estate section, concedes that “some people might perceive it is advertising.” But “it’s also something that attracts people to the section.”


Does that justify it? “Sure, I think so.”


But he adds, “When I first saw it, I wasn’t all that crazy about it.”


Another Mercury business reporter expressed stronger reservations: “In my mind, there are no reasons to have it in the paper except for bad reasons.” 


No comment


Business section journalists say “Fantasy Home” is the brainchild of Managing Editor Susan Goldberg. Neither Ms. Goldberg, nor Executive Editor David Yarnold, responded to phone calls or email queries over a two-week period.


The final commandment of the Society of Professional Journalists Code of Ethics is “Be accountable. Clarify and explain news coverage and invite dialogue with the public over journalistic conduct.”


The conclusion that Mercury news executives follow different standards than other journalists in their organization seems difficult to escape. So is the conclusion that those who shape the news most powerfully ought to be the most accountable to ethical standards.


¾John McManus