New Blogging and Endorsement Guidelines (FTC – Dec, 2009)

I have been tracking this issue for a while, but I wanted to wait until I had a concise and insightful perspective before I blogged about it. So here goes. 

 

In essence, the Federal Trade Commission (FTC) published these guidelines to address what some creative advertisers were doing with blogging and in the social media arena (Facebook, Twitter, etc) (i.e. paying bloggers to endorse their product without the bloggers actually believing in the product or maybe without even using it). The FTC is really focused on the product advertisers, and not bloggers or users, unless the blogger is a sponsored endorser (i.e. receiving something ($, product, etc.) in return for promoting the product). [By the way, the FTC has even stated that they drafted these guidelines not with the intention to sue bloggers, more here — I thought that was a nice touch]

 

A definition will help. 

 

An endorser is someone that publishes an:

 

 “…advertising message those consumers are likely to believe reflects the opinion, belief, finding or experience…” of the publisher, but is not the product advertiser. 

 

It is obviously relevant if the person is:
 

(1) providing an independent review [i.e. off the hook], or

(2) somehow compensated by the advertiser (directly or indirectly). 

Examples of sponsored endorsers: paid bloggers, or bloggers that receives many free products. 

 
If there is a sponsored endorser, then the advertiser and the sponsored endorser could have liability for: 

 

1) false/misleading statements or unsubstantiated statements, and
 

2) failure to disclose the connection or any compensation. 

 

One important point here is that the advertiser should require the sponsored endorser to disclose the connection to the advertiser and only publish substantiated claims. The advertiser should also monitor the blogger, as they could still be liable for their unsubstantiated or false claims. 

 

There is a lot more to these guidelines, and I have tried to summarize them here in business terms (not lawyer speak), so talk to your attorney before taking any action under these new guidelines. If you want to read a lot more about it, then go to the source.
 

 

Another way to look at this issue, is with a simple Decision Tree:

 

1) Is the message an endorsement? 
 

2) If yes, then:

(a) is it an independent review, or

(b) is there some form of compensation from the product advertiser. 
 

3) If (b) is yes, then the blogger must disclose the connection to the product advertiser, not make any false claims, and substantiate any representations (the product advertiser should require the blogger to disclose the connection and not make any unsubstantiated or misleading claims). 

 

Of course everyone knows that all messaging should be based on honest beliefs, findings or experiences (that really goes without saying). 

Any one looking for investors, growth private equity or venture funding should be aware of these new FTC guidelines, as they can impact your content marketing strategy.

Some more general information is here: link

[By the way, I have not discussed the celebrity endorsement rules or the new rules on whether results are typical or not, as that is for another day and another post]