Updated paid search guidance from the Federal Trade Commission requiring better labeling could have a big impact on the mobile space, where space is already at a premium.

The FTC recently distributed updated guidance on paid search to Google, Bing, Yahoo and other search engines that conveys the need for paid search ads to be clearly recognizable as separate from natural search results. Since paid search on mobile has unique challenges, the requests could require some changes in how ads are displayed going forward.

?Any change to how paid search listings are displayed on Google, Bing, and Yahoo will impact brands, and this is no exception?but we will have to wait and see how large the impact will be,? said Jeremy Hull, associate director of paid search at iProspect, Boston.

?Some changes, such as the request for more prominent shading or placing borders around paid search listings, we predict to have a minimal impact,? he said.

?Others, such as text label requirements - placement above or to the left of ads (?in front? of them) - and consistent wording - not calling them ?ads? in one placement and ?sponsored? in another - will potentially have a larger impact, depending on precisely how each engine chooses to implement the requested changes.?

Cluttered space
Mobile paid search is growing quickly and playing a bigger role in how consumers search for products, merchants and services all the time.

A new report from IgnitionOne reveals that during the second quarter of this year, paid search spending on tablets was up 116 percent and up 106 percent on smartphones.

The update is also in response to what the FTC says is the increasing prevalence in recent years of paid search results that are less distinguishable as advertising.

Part of the problem is that search engine result pages have been getting more crowded over time with local listings, knowledge graph information, new extensions such as image ads and new channels such as Product Listing. These ads tend to overshadow less-flashy natural search results, per Mr. Hull.

?When the SERP was just paid ads and natural results, it was easy to understand which elements were ads - these days with all these different varieties of information being thrown at the user after they search, it?s much more difficult for the average user to tell sponsored ads from natural listings,? Mr. Hull said.

Causing confusion
Mobile provides some unique challenges to search advertising.

One is the small screen size on smartphones, which could become even more cramped if additional indicators are required to distinguish an ad.

?SERPS have a completely different format, adjusted to fit smartphone screens,? Mr. Hull said. ?This reduced real estate leaves less room for paid ads, so competition for top position is often higher - and with the advent of Enhanced Campaigns, we predict competition in this space to increase.

?Additional indicators highlighting advertisements vs natural results could potential add more clutter to this already crowded space and cause confusion rather than clarity,? he said.

Voice search
The new guidance also addresses voice search, which has been growing with the introduction of services such as Apple?s Siri.

?As technology evolves and we see more verbal interactions with devices, it will make distinguishing paid and organic more challenging,? said Roger Barnette, president of IgnitionOne, New York.

The guidance advises that regardless of the precise form that search takes now or in the future, paid search results and other forms of advertising should be clearly distinguishable from natural search results.

The FTC also warns search engine companies that failure to make paid search ads clearly distinguishable could be interpreted as a deceptive practice.

Action needed
In the new guidance, the need for visual cues, labels, or other techniques to effectively distinguish advertisements and avoid misleading consumers is emphasized.

The updated guidance was sent to AOL, Ask.com, Bing, Blekko, DuckDuckGo, Google, and Yahoo!, as well as 17 of the most heavily trafficked search engines that specialize in the areas of shopping, travel, and local business, and that display advertisements to consumers.

The implication for search engine companies is that if they do not take action, the FTC could take action against them.

?We don?t think that having more distinct clarification of ad and sponsored results versus organic will affect the efficacy of paid ads,? Mr. Barnette said.

?We assume this request will be addressed by the search engines, but if they do not make the ads more distinct, the FTC can take action with potentially serious ramifications,? he said. ?But we don?t think it will come to that as minor clarifications are probably all that is needed.?

Final Take
Chantal Tode is associate editor on Mobile Marketer, New York