Ink Foundry - Social Media Marketing and Word of Mouth Marketing

UPDATED: October 8, 2009

TOTAL READ TIME: Approx. 2 minutes

By Carin Galletta

The Federal Trade Commission (FTC) disclosure guidelines to regulate the relationship between brands and bloggers have been released and will be in full effect beginning December 1, 2009.

The Word Of Mouth Marketing Association (WOMMA) today hosted a webinar to discuss the recently released FTC regulations on adequate disclosure that the industry association was instrumental in spearheading.

To insure compliance, make sure that you include your brand’s legal council in all disclosure policies. Anthony DiResta, WOMMA’s general counsel and partner at Manatt, Phelps & Phillips, LLP is advising that the spirit of the FTC guidelines be followed as a regular component of all risk management and that the FTC guidelines not be isolated.

Overview:

I’ve updated the key points from the webinar, but I encourage you to check the Ethics Review on the WOMMA site and the resources listed at the end of the article for additional guidance and continuing information as it becomes available.

As I wrote earlier this Fall, the FTC guidelines should not represent a dramatic departure from current standard operating best practices for disclosure.

Top Takeaways:

• Regulated disclosure is only required for those communications that are sponsored.
• Anyone who is acting on behalf of a brand, will be required to disclosure.
• Celebrities now have a duty to disclose relationships beyond traditional advertising, e.g. on talk shows, Twitter, Facebook, etc.
• The safe harbor of “results may vary” is no longer acceptable.
• The FTC will track compliance by listening to consumer complaints, consumer advocate groups, trade associations, state attorney offices, Better Business Bureau and even competitors.
• Disclosure on both the brand and the digital influencer side is required.
• Brands need to codify their policies for disclosure and monitoring processes and provide training.
• Advertisers/brands will not be held liable for bloggers who fail to disclose IF the brand has documented disclosure policies and procedures in place.
• The “influencer” who has or will receive some form of incentive/payment/gift is required to disclose the relationship.
• There could be liability for advertisers, agencies & endorsers for misleading/unsubstantiated statements and / or claims.
• The FTC will not make a distinction between cash, products, points, free meals, tickets/passes, etc. – it all constitutes a material relationship.
• Fines for misconduct will be incurred by either the brand, agency or the blogger, with no limit on the fine.

Best Practices:

For The Brand

• Publish a clear, detailed ‘terms of engagement on the website, brand microsite or campaign site.
• Make a commitment to work with third party influencers who adhere to clear disclosure best practices
• Creating a one page influencer agreement that requests bloggers to remain objective
• Request that all third party influencers link back to the brands ‘terms of engagement’ policy.
• If you send a product for review, ask the blogger in writing, to disclose that the product was given for free

For The Influencer

• »If brands don’t have a ‘terms of engagement’ for working with bloggers, then ask that they create one.
• »Commit to working with brands who adhere to standard disclosure best practices.
• »Disclose in each post.
• »Create a policy that is visible and easy to read on your website, blog or Twitter account.
• »Include brand affiliation and /or your likelihood that you will receive compensation in the future in your bio

Resources:

FTC Guidelines info: Tony DiResta’s Legal Ethics blog http://ow.ly/tfQZ

Wall Street Journal: http://online.wsj.com/article/BT-CO-20091006-709182.html

PHOTO CREDIT: Graffiti.org

• Posted on Thursday, October 8th, 2009
• 1 comments