Hey, bloggers, social media influencers, and celebrities, think the Federal Trade Commission (“FTC”)’s rules regarding disclosures do not apply to you? Think again. While the FTC – a governmental agency tasked with promoting consumer protection, and eliminating and preventing anticompetitive business practices – has thus far chosen to focus its energies entirely on the advertisers that it deems to be more responsible for such potentially illegal behavior, it does in fact, also have the authority to take action against bloggers individually.
To date, the FTC has not been faced with such massive schemes by brands in connection with such truly influential bloggers. However, change is likely upon us. The monetary compensation at issue – think: tens, if not hundreds, of thousands of dollars for their deals – will likely call for greater action by the FTC in the very near future.
So, what can you do to ensure that you are not running afoul of the FTC’s guidelines (and thus, federal law), and thereby, running the risk that the FTC initiates an investigation and potentially disgorges you of all profits you’ve earned in connection with a campaign or partnership? It is easy! Here are a few tips – taken directly from the FTC’s various guidelines – that will get you started (but which are NOT to be considered legal advice and are not to stand in for independent consultation with legal counsel, of course) …
1. First of all, when do you need to disclose? If you are being compensated in any way to promote/endorse a brand or product (this includes free gifts) or are promoting/endorsing a brand with which you have a relationship (aka you started the brand or invested in the brand, or are one of its spokesmen/ambassadors or advisors), you need to disclose that. This includes affiliate links.
2. Is posting a photo an endorsement? The FTC says yes! A photo is enough to trigger the need to disclose: Simply posting a picture of a product on social media, such as on Pinterest or Instagram, or a video of you using it, could convey that you like and approve of the product. If it does, it’s an endorsement and must be disclosed.
3. Posting multiple endorsements/promotions? If you’re posting multiple blog posts, Tweets, Instagram posts, etc. for any one brand or campaign/sponsorship, you need to replicate your disclosures. And if you share an Instagram post on Twitter, for instance, you need to include a disclosure on all of the individual posts. Including a single disclosure for all of the posts is NOT enough.
4. Social media: On social media, limited space is NOT an excuse. According to the FTC, “The words ‘Sponsored’ and ‘Promotion’ use only 9 characters. ‘Paid ad’ only uses 7 characters. Starting a tweet with ‘Ad:’ or ‘#ad’ – which takes only 3 characters – would likely be effective.”
5. Contests: If you run a contest or sweepstake on social media channels or on your website/blog, the official rules must require some type of disclosure in each entry. It is the responsibility of the brand/influencer, not the entrants, to ensure that this disclosure is being used.
6. The FTC’s suggested disclosures: In blog posts and social media posts alike, the FTC requires the inclusion of “clear and conspicuous” disclosures near the beginning of blog posts or tweets or Instagram photos or videos. Again, “#Ad”, “Ad:” or “Sponsored” will suffice if they are not hidden, but so will clear statements that you have been paid to promote a product or brand.
According to the FTC's .com Disclosures guide: "Short-form disclosures might or might not adequately inform consumers of the essence of a required disclosure. For example, “Ad:” at the beginning of a tweet or similar short-form message should inform consumers that the message is an advertisement, and the word “Sponsored” likely informs consumers thatthe message was sponsored by an advertiser. Other abbreviations or icons mayor may not be adequate, depending on whether they are presented clearly and conspicuously, and whether consumers understand their meaning so they are not misled."
Along these lines, “#Sp” will be deemed to be an improper disclosure because it is likely not clear enough to enable consumers able to differentiate advertising from other content. “Spon” is similarly not a preferred disclosure, according to the FTC. Moreover, “#collaboration” and “#partner” will also fail to meet the required level of disclosure, as such terms do not provide enough clarity in terms of the nature of the posting and the relationship between the parties.
As for the latter two disclosures, Andrew B. Lustigman, who serves as chairman of the Advertising, marketing & promotions law practice at Olshan Frome Wolosky LLP, has doubts as to whether they will meet the required level of clarity: “I am concerned that consumers will not understand what these terms mean as it relates to compensation.”
7. So, you are posting something and it needs to be disclosed. Now what? Well, the disclosure needs to be “clear and conspicuous.” This means it must be:
• Close to the claims to which it relates (aka, do not hide it all the way at the bottom of the post or bury it amongst other text or other hashtags or add "ad" at the end of another hashtag);
• In an easily readable font and font size;
• In a color that stands out against the background (aka, you can’t hide it this way either);
• For video ads, on the screen long enough to be noticed, read, and understood; and
• For audio disclosures, read at a cadence that is easy for consumers to follow and in words consumers will understand.
7. WHEN IN DOUBT … DISCLOSE!