User What does the new law on advertising mean

What is happening?

What is new in the law?

Expert opinions

In the latest version of the law, all ad distributors, advertisers, and advertising system operators who place online advertisements targeted at users in Russia are required to provide information. Everything else remains unclear, leaving more questions than answers, making it too early to draw conclusions about how the market will change. For the traffic arbitrage market, the law will primarily impact native advertising networks and the arbitrageurs themselves.

On one hand, moving operations to a different jurisdiction may not change much globally since there are laws governing the landing of foreign companies, and there are no guarantees that payments from abroad will be accepted in Russia. On the other hand, if considering financial and physical security, moving to a new jurisdiction allows one to remain in the shadows. However, risks still exist.

In this matter, it is best to rely on professional lawyers. Currently, it is difficult to assess how significantly this law will impact affiliate marketers. It is necessary to thoroughly study all the intricacies. After reading the law, one can assume that advertising in Russia will become very challenging.

Of course, the changes in the law will affect our company, but their impact won't be that significant. Therefore, there's no need to relocate to a different jurisdiction. As for changes in offer conditions, they should be expected in niches dealing with TCUPIS, betting, financial offers, etc. As an agency, we will have to report on all advertising and integrate relevant expenses.

Who poured traffic in white or cloaked won't make a difference. For a regular arbitrageur, cloaking is indeed the most likely option since all advertising networks will be required to submit information about advertising campaigns. It's worth enhancing cloaking skills, even for sources that used to easily pass creatives.

Advice for iGaming: diversify your business and explore all profitable verticals, such as nutra. And most importantly, be sure to read the user agreement with your affiliate networks. The advertiser will shield themselves with a contract for subcontracting services, the ad network will report to Roskomnadzor, while the arbitrageur will be a direct violator of the "Advertising Law."

It's unclear how cloaking will save the situation since platforms are required to report on the content they display. The best option is to go white-hat or shift focus to other GEOs.

Arbitrageurs who work with Russia have long been recommended to focus on international markets since major traffic sources from our country have disappeared. Currently, we have many offers targeting foreign markets. Cloaking will still be relevant as there are no anticipated changes in that direction. Those who used cloaking for Russia will continue to do so. As for working with SEO, there's an interesting point: the new amendments will put a significant burden on Roskomnadzor, which will have to increase control over advertising agencies. This may lead to a situation where they won't have enough time to deal with websites, and SEO specialists might breathe a little easier.

The cost of advertising will increase, but not solely due to the law; it will also be influenced by the surplus of advertising budgets. Major channels like Facebook and Google have left, but the budgets allocated for them remain. On the other hand, native networks are gaining more attention from both arbitrageurs and legitimate advertisers. However, I must emphasize that there are only 4-5 truly worthwhile networks for the entire Russia and CIS region. It is still possible to enter and establish a presence there, but in the future, it will become very expensive and challenging.

While the law has not yet come into effect, it is difficult to assess, but let's see how things unfold in the long run.

I assume that the cost of advertising will increase. The key factor here is to understand who will bear the expenses. If agencies are affected, they are likely to raise the costs of their services logically. However, the advertising auction will probably remain unchanged, and any transition there will likely be gradual and phased.

Verticals themselves won't be affected, but advertising and, to a large extent, native networks will need to restructure their businesses, go white-hat, and come out of the shadows. This will lead to a more complex moderation process.

Across all verticals that deal with non-white-hat practices.

Likely, moderation will become stricter everywhere. The skill of cloaking was previously considered a key skill, but soon it will become mandatory for any type of traffic.

Working without issues: comply with all the laws of the country where you purchase advertising. Otherwise, you will always have problems; the question is only how critical they are and whether they can be resolved.

There are noticeably fewer sources of traffic in our country, so I would recommend considering international GEOs. However, if you are determined to stay in Russia, you can continue to run traffic for iGaming offers.

Indeed, it is possible. Additionally, one can say that the departure of some to the international market will free up space for others in the Russian-speaking market. It's the law of the cycle. This phenomenon was observed in the goods and nutra markets in 2018, and it will likely occur again now.

Absolutely, not only entering the international market but also maximizing efforts to work with white-hat traffic is essential.

We have been advising arbitrageurs to enter the international market for several years now. It is never too late to do so. However, I'm not sure if the new amendments to the law will be the "final straw" for those who remain in the Russian market.

Legal context

That is quite possible, but it is essential to directly examine the law itself. Unfortunately, sometimes legislative initiatives are conceived with one goal in mind, but the final outcome turns out to be something entirely different when the law is proposed for consideration and adoption.

Certainly, additional obligations will emerge, strictly bureaucratic in nature, for the participants of this private business. Depending on the sector, they will impose functions that are not inherently characteristic of this business.

Apart from that, it is important to understand that a certain moment of monopolization of this market is emerging. Moreover, in the context of censorship effectively introduced in Russia since February of this year, the collection of detailed information regarding both advertisers and their clients, of course, gives Roskomnadzor more leeway.

If before, we saw some bold advertising examples, especially in regional contexts, they reached their target audience by presenting a product or service in a quite competitive, albeit sharp, manner. Now, all advertising across the country will be sanitized. In general, it's like back in the USSR; there won't be any room for the truly creative minds in this market.

Without knowing the final form of the amendments to the law, I still believe that it would involve certain monitoring. Requesting permission to enter into a contract between two legal entities [for the implementation of an advertising campaign] would be absurd and would mark the end of the advertising market. So, while anything is possible now, I don't expect it to reach such extremes.

It seems that it won't be a straightforward permit process, but more like a post-factum system. If advertisers draw attention to themselves one, two, or three times, Roskomnadzor will express its disapproval of the more liberal representatives of this market. Subsequently, advertisers may hesitate to hire interesting creators to promote their products and services in the market. It probably won't be a full-fledged permission system; rather, it will be a very strict self-censorship.

I cannot say that it will be completely restricted [access to these social networks for advertising], because, to begin with, social networks are usually managed by IT specialists and marketers either in the advertiser's staff or hired by the advertiser. In this case, the ad distributor is the social network itself.

Therefore, in no way does this law restrict them as ad distributors, as far as I can see. Similarly, you provide ads, whether contextual or banner ads. Why not?

Yes, that's correct. They are already afraid and, in general, do not provide direct links to these social networks; they remove their logos from print materials. In this case, they will simply block any advertising on these platforms.

And this will be an effective tool. "Oh, so you are here, that means you are supporting an extremist organization."

The question is not about reduction but about the accuracy of advertising, primarily. Because for advertising, sometimes they use samples that do not correspond to what the consumer sees in the end. So, there could be a certain advantage in tracking: who provided the advertisement and why.

In our case, the ad distributor is not responsible for the advertising since, according to the law, they are not considered the entity that can control it in any way and are not obligated to do so.

I don't think there will be fewer ads, probably not. The entire space is likely to remain. But yes, there may be slightly more social advertising, slightly more informative. Well, yes, more of what can be called state propaganda.

I believe that it won't be possible for them [Roskomnadzor] to track everything. Our advertising market is very diverse. It includes internet platforms, local media, and even some private publications, I mean some electronic ones, so it can be anything. Therefore, covering all of this, in my opinion, is impossible.

Yes, of course. This is actually a form of self-censorship. By the way, it's very American. The participants of the market themselves are entrusted with this function, at their own expense. They will simply be forced to do it. And if Roskomnadzor doesn't see something in the database, they will just punish for poorly filled databases. That's all.

Conclusion