Best Practices In FTC Online Advertising Disclosures For Bloggers

FTC Disclosure for Bloggers
FTC Disclosures for Bloggers

In a previous article, available here, I addressed the main issues bloggers should be aware of in the March 2013 Federal Trade Commission (“FTC”) guidelines regarding if and when disclosures must be made in connection with online advertising (the “Guides”, which are available here).  That article generated a great deal of questions about specific examples of when disclosures may be required.  While I cannot provide specific legal advice, I hope this article will help to address many of those questions.

The first thing to consider is whether your post, Tweet or Facebook status update is offering an opinion or making a claim about a product or service.  If it does, did you receive anything of value related to that product or service or did you have any connection to the company offering the product or service at the time the claim or opinion was made?  If you did, your communication could be considered an advertisement and a disclosure would be required.  According to the FTC the purpose of disclosures is to “ensure that consumers receive material information to assist them in making better-informed decisions.”  “Material information” isn’t defined by the FTC, however a common sense approach is to put yourself in your readers’ shoes and ask “would I want to know this if I was reading this post?”

As a hypothetical, assume a popular food blogger, Lisa, is writing a post reviewing a new blender, the Mix-O-Matic 3000, and she gives it a positive review.  Suppose she received the blender as a gift from her father (who has no relationship with the company that made the blender, Mix-O-Matic Corp.).  The Guides would not apply since Lisa didn’t receive anything of value from Mix-O-Matic Corp. or have a connection with anyone associated with that company.  Should she disclose that it was a gift?  Lisa is not required to under the Guides, but sharing that information may increase the credibility of her review with her readers.

Now assume instead that she bought the blender herself, but her father works for Mix-O-Matic Corp.  According to the FTC where “there exists a connection between the endorser and the seller of the advertised product that might materially affect the weight or credibility of the endorsement (i.e., the connection is not reasonably expected by the audience), such connection must be fully disclosed.”  Since the connection between Lisa and Mix-O-Matic Corp. would not be “reasonably expected” she should disclose that her father works for that company.

As discussed in my previous article, disclosures must be “clear and conspicuous” and “should be placed as close as possible to the claim they qualify.”  “Clear and conspicuous” is not defined in the Guides.  However, the FTC offers this guidance, “[t]here is no litmus test for determining whether a disclosure is clear and conspicuous, and in some instances, there may be more than one method that seems reasonable.  In such cases, the best practice would be to select the method more likely to effectively communicate the information in question.”

So at a minimum Lisa should include a statement early in the post that her father works for Mix-O-Matic.  What if Lisa’s blog auto publishes links to new posts via Twitter, Facebook, LinkedIn, etc., is a disclosure required in the tweet or status update?  It will depend on what is communicated in that tweet or update.  Suppose the title for her post is “My Take On The Mix-O-Matic 3000” and the tweet or update reads “Lisa just posted a new entry:  My Take On The Mix-O-Matic 3000.”  No disclosure is likely required because there is no endorsement of the blender in the title, it is a neutral statement.   A reader won’t see the claim she’s made (a favorable review) until they read the post which includes the disclosure.  What if instead the post was titled “Why I Love My Mix-O-Matic 3000.”  Now a claim about the blender is being conveyed in the title, and therefore in the tweet or update, and a disclosure would be required (the FTC suggests “#paid ad”, “#paid”, or even “#ad” may be effective disclosures where space in the communication is limited).

Now suppose instead that Lisa was given the blender by Mix-O-Matic Corp. directly for the purpose of writing a review and that she may be paid for her review in the future.  At the time she writes her review she should disclose both that Mix-O-Matic Corp. gave her the blender and that she may be paid for the review, even though she hadn’t been paid at the time she wrote it.  Alternatively, what if Lisa was not promised financial compensation and was instead told that she may be chosen to appear in a future Mix-O- Matic 3000 television ad?  According to the FTC a potential television appearance is a “benefit” that must be disclosed.  However, if Lisa purchased the blender herself and Mix-O-Matic Corp. made the television ad offer after seeing her positive review she likely does not need to revise her original post with a disclosure about the offer because there was no potential benefit when the review was written.  Although, putting yourself in the position of Lisa’s readers, would you consider her more credible if you saw an update to the original post mentioning that she appeared in the ad only after her review was written?

As shown above, and as I stated in my earlier article, whether or not an FTC guideline applies to a particular activity is a highly fact specific question and bloggers should consult with an experienced e-commerce attorney if they want specific advice on their situation.  When offering opinions about, or even mentioning, a company’s product or service ask yourself if there is information you could provide that would help your readers make a better informed decision about whether to purchase that product or service.  If the answer is yes and you disclose that information you are not only likely complying with the Guides, you are also building credibility with your readers.

 



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Comments

19 responses to “Best Practices In FTC Online Advertising Disclosures For Bloggers”

  1. Steve Didier Avatar
    Steve Didier

    Very well written and a very informative follow piece. Thank you for your diligence!!

  2. Dov Shapira Avatar
    Dov Shapira

    You’re not asking for ethics from food and drugs companies, Are you?
    I have no idea why the FTC is so behind in those regards.
    Weather they are backwards or it just takes forever to pass new laws.

  3. Tina Avatar

    I am not paid to comment here. I am not employed here. I have no connection whatsoever. I think this is informative and educational. Thanks.

  4. Veronica Avatar
    Veronica

    Great information!

  5. Rob Avatar

    Very Informative thanks!

  6. Maria Fontaine Avatar
    Maria Fontaine

    Thanks for this very important information and insight!!

  7. Arun Avatar
    Arun

    Great article. Thanks for the info!

  8. Teresa Avatar
    Teresa

    Great article. Thanks for sharing

  9. Teri Avatar
    Teri

    In such a litigious society it is frustrating as a reader to have to read all of the disclaimers. I wouldn’t take only one person’s opinion on anything, and read the good and the bad about stuff before coming to my own conclusion.

  10. Julie Wilson Avatar
    Julie Wilson

    Thanks for sharing

  11. Meli Avatar
    Meli

    Thank you for explaining this issue so well. You certainly made it easy to understand.

  12. Marilyn Avatar
    Marilyn

    Awesome thank you for such descriptive reasons to have the disclosure.

  13. Daniele Holmberg Avatar

    Joanna, Thank you so much for the well written piece with such detailed information:) You are awesome! Thanks for looking out for all of us!

  14. M.l. Owens Avatar
    M.l. Owens

    This is an interesting article. I take issue, however, with the assertion the author makes in the parentheses at the end of the sixth paragraph; to wit: “(the FTC suggests “#paid ad”, “#paid”, or even “#ad” may be effective disclosures where space in the communication is limited).” This is wrong.

    No where in the FTC’s “.com Disclosures” does the FTC suggest that a disclosure that begins with a hash-tag would be effective. Hash-tag are only discussed in “Example 17” concerning tweets and other short-form messages. Therein, the only has-tag reviewed is “#spon.” The Guidance states,

    “Consumers might not understand that “#spon” means that the message was sponsored
    by an advertiser. If a significant proportion of reasonable viewers would not, then the ad would
    be deceptive….Putting #spon directly after the link might confuse consumers and make it less likely that they would understand that it is a disclosure.”

    The Guidance discourages the use of hash-tags for purposes of disclosure, particularly in the context of tweets and short-form messages. For purposes of tweets and short-form messages, the only disclosures endorsed by the FTC are “Ad:” and “Sponsored:”. In addition, the Guidance urges that in tweets and short-form messages the disclosure should be at the beginning of the message.

    1. Mark Leonard Avatar

      M.I., thank you for your comment. The hash tag examples came from a FTC FAQ, available here: http://www.business.ftc.gov/documents/bus71-ftcs-revised-endorsement-guideswhat-people-are-asking. I apologize if it appeared I was referring to the Guidelines as the source for those examples.

  15. Tisha Anne Avatar
    Tisha Anne

    holy cow! I had no idea so much information was involved!

  16. Tehachapi News Avatar
    Tehachapi News

    Excellent write-up. I definitely appreciate this site. Continue the good work!

  17. […] Stephen Hawking’s once said “The greatest enemy of knowledge is not ignorance, it is the illusion of knowledge.”  It is up to the blogger to understand the legalities and to comply. Do not leave it to the sponsors to teach you, and do not get your information from questionable sources. Become familiar with the California Legal Guides / Business and Professions Code sections that pertain to giveaways.  Below I have broken down which are the most important sections, and what could happen if one fails to comply. Please note that this is just the regulations from the California Department of Consumer Affairs regarding giveaways, every blogger should also understand FTC Guidelines when doing giveaways some that can be read here. […]

  18. Advertising.com Avatar

    Mark, Thanks for the well written article, it was inspiring and powerful.

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