When users realize something is sponsored, they may trust it less or skip it, which lowers click-through rates. However, transparency builds long-term credibility for platforms and advertisers, reducing confusion and accidental engagement. Clear labels also help users make faster, more informed decisions, especially in feeds where attention is limited. Even if performance metrics dip at first, honesty can improve overall user satisfaction and brand trust over time, similar to how clearer signals improve understanding in other digital systems.