Digital marketing is a big pond, and it does not matter if you are a catfish or a guppy, compliance with endorsement and disclosure policies apply to all and across all platforms. You are legally required to mention if you have a relationship that influences an opinion you share on any medium. Disclosure matters and it matters a lot for all businesses and brands, large or small.
Yes, our tweet above promotes a blog post that contains material that could bias the opinion we share. In addition, if you read the blog post, you will notice that we have disclosed the relationship between the company (HitTail) we mention and LGK.
Of course, the ultimate goal is to increase web traffic and in turn generate new business. Moreover, while we are trying the subscription-based service courtesy of HitTail, it is still early in our testing phase, so we will continue to provide updates of our experience.
It has been at least two years since the Federal Trade Commission’s .com Disclosures Guide, which provides an update of guidelines for online marketers. Small businesses and organizations, alike, can learn a lesson from big brands and advertisers who have tiptoed or crossed the line of endorsement and disclosure rules. In March 2013, retailer Nordstrom Rack received a warning and revised its social media policies following a Tweetup event where influencers who attended received gifts. A quick search of brands and companies running left of Federal Trade Commission (FTC) rules in 2014 include:
- Cole Haan, the footwear brand, which did not instruct contest participants to disclose that their actions were in pursuit of a prize.
- Pop icon Lady Gaga, who failed to disclose her relationship with cosmetics giant Shiseido when she posted a series of selfies on Instagram.
- ADT, the electronic security company that drew the ire of the FTC by commissioning numerous fake online reviews.
- Deutsch LA, an advertising agency whose employees tweeted about a campaign without disclosing the agency’s ties to the client. The FTC lowered the hammer and settled its first deceptive advertising case.
It is important to note that it is just not the FTC, but state regulators, too, who monitor deceptive practices on the Internet. Two years ago in New York, 19 companies reached an agreement with the state attorney general and racked up $350,000 in penalties. According to the New York Times article, Give Yourself Five Stars? Online, It Might Cost You:
… Among those signing the agreements are a charter bus operator, a teeth-whitening service, a laser hair-removal chain and an adult entertainment club. Also signing are several reputation-enhancement firms that place fraudulent reviews on sites like Google, Yelp, Citysearch and Yahoo.
“What we’ve found is even worse than old-fashioned false advertising,” said Eric T. Schneiderman, the New York attorney general. “When you look at a billboard, you can tell it’s a paid advertisement — but on Yelp or Citysearch, you assume you’re reading authentic consumer opinions, making this practice even more deceiving.”
Here are a few tips and resources to bookmark or download and review to ensure your small business or organization complies with the rules of endorsements and disclosures.
For a good summary of the FTC’s 2013 disclosure update, read 2013 FTC Dot Com Disclosure Updates and What They Mean For Marketers by attorney Sara F. Hawkins.
In the article, The FTC and Social Media: You Have to Disclose, Gini Dietrich of SpinSucks outlines a few best practices that she follows and you can too.
Following are the things you can do:
- Social media policy. Our social media policy is pretty simple: Don’t swear online, live the Golden Rule, and always disclose your relationship when sharing client information.
- Share articles. When I read an AdWeek article about the Deutsch case, I shared it immediately in our Facebook group and asked everyone to read it.
- Write blog posts. I often write blog posts about topics I need my team to be familiar with…and that will also help all of you (case in point, this very piece).
- Discuss in staff meetings. We have a standing section on our staff meeting agenda for social media. This is where we discuss the latest and greatest.
- Send company-wide emails. Once a quarter, it’s not a bad idea to send a company-wide email that reminds everyone about your social media policy and the big dos and don’ts.
Kerry O’Shea Gorgone put together an excellent post on keeping sponsored content legal. Here are a few highlights:
Disclosure doesn’t have to be hard (even in a tweet)
- Are you posting something relating to a client? Add “[Client]” to your tweet.
- Did a company sponsor your trip to their annual gala in Las Vegas so you could cover the product launch they announced there? Add “[Sponsored].”
- Incorporate “#ad” if you’re short on space. Character limitations are no excuse for failing to disclose the connection.
Disclose every time you make a claim or share a post in which there is a relationship or connection not obvious to the reader. Don’t post a disclosure saying “the next 20 or so tweets are all sponsored,” and never mention it again. That won’t do it. “The disclosure should be in each and every ad that would require a disclosure if that ad were viewed in isolation.” (Source: FTC’s .Com Disclosures, March 2013)
When in doubt, disclose.
Don’t worry so very much about precisely when this person gave you something valuable. Even if it was six months ago, disclose. It’s better to be overly cautious now than sorry later.
Brands: clearly communicate your expectations
Smart brands tell bloggers and influencers that they expect them to disclose in accordance with the law. Don’t leave disclosure to chance. It’s not worth it. Legal implications aside, you’ll be under undercutting their value to your brand. Influencers that have lost the trust of their audience are no longer influential.
Tell bloggers you work with that you expect them to disclose early and often.
The Word of Mouth Marketing Association offers a social media marketing disclosure guide that highlights best practices and responsibilities of using social media. Visit this link to request a download of the easy to read and comprehend document.
Download and keep handy, the FTC’s .com Disclosures: How to Make Effective Disclosures in Digital Advertising. The document includes information on how to comply with online disclosure rules, as well as, practical examples. Visit this link.
Lastly, the Bureau of Consumer Protection Business Center has a short video on FTC endorsement guidelines. You can watch it here.
Does your organization have an endorsement and disclosure policy? Feel free to share your thoughts in the comments section of this post.
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