New guidance from the FTC for online disclosure still vague, but merits renewed attention
When marketers talk about the “wild west” days of executing social media campaigns in 2008 and 2009, it is often with a wistful look in their eyes. Yes, we miss the days when both the cost to activate and the stakes were low. We were generally granted wider permission to throw things against the wall to see what would stick. But without clear guidance on transparency and disclosure, there was a layer of slime and duplicity that was difficult to ignore.
In the face of this, many digital practitioners were relieved in 2010 when, for the first time, the Federal Trade Commission (FTC) issued public guidance about proper disclosure in online endorsements. Self-styled “social media gurus” and white-shoe attorneys studied the FTC’s endorsement and testimonial guides for advertising to parse and speculate on what actions a brand, agency partner or individual blogger should take if they violated the spirit of the guidelines.
While the FTC has continued to issue guidance on associated issues, most notably in 2013 with their dot com disclosure guide, the original endorsement guidelines remained unchanged, until just a few weeks ago when the FTC published a supplement called “The FTC’s endorsement guides: What people are asking” in a more accessible FAQ-style document.
While this is a guidance document only and not a legal statute, the FTC has increased scrutiny of social media marketing campaigns. The language in this latest publication from the FTC indicates that they will no longer be turning a blind eye or issuing a warning letter for campaigns out of compliance—they can now expect an official action.
Here are some key clarifications for brands and marketers to keep in mind; this list is not exhaustive. If you have questions about any campaigns you are planning or are currently in flight, consult a trusted social marketing practitioner.
- Contests and sweepstakes: If you run a contest or sweeps on social media channels, the official rules must require some type of disclosure in each entry. It is the responsibility of the brand, not the entrants, to ensure that this disclosure is being used. The FTC also indicated that the hashtag #sweeps is not clear enough. You must use #contest or #sweepstakes.
- Character limits: The FTC won’t hear arguments about character limits preventing you from using appropriate disclosures or hashtags. The new guidelines state, “The words ‘sponsored’ and ‘promotion’ use only nine characters. ‘Paid ad’ only uses seven characters. Starting a tweet with “ad:” or “#ad” (which takes only three characters) would likely be effective.
- On streaming events including gaming live-streaming: Since viewers can tune in any time, they could easily miss a disclosure at the beginning of the stream or at any other single point in the stream. People should see a disclosure no matter when they tune in. There could be multiple, periodic disclosures throughout the stream. To be cautious, you could have a continuous, clear, and conspicuous disclosure throughout the entire stream.
- Paid “Like” campaigns: If advertisers purchase “likes” from non–existent people or people who have no experience using the product or service, those likes are clearly deceptive, and both the purchaser and the seller of the fake “likes” could face enforcement action.
- Employee endorsements and testimonials: Any employee of a brand, or employee of an agency promoting content on behalf of a brand, must clearly state their affiliation in every social media post. This disclosure must go beyond their Twitter bio, Google+ description or other “About” section copy. It must appear in all posts promoting the products or services of their employer and/or their clients. Additionally, the FTC has stated that employers are forbidden from asking or incentivizing employees to post anything on social media that is untrue, that is not that employee’s valid opinion, or to endorse a product or service they are unfamiliar with.
- Sponsored videos and video endorsements: The FTC is requiring videos to contain “clear and conspicuous” disclosures, which means they must be made at the beginning of the video, must be repeated multiple times throughout for longer videos, and must be on the screen long enough to be noticed, read, and understood. Including a disclosure only in the description text, notes or comments is not sufficient—it must appear in the actual video.
- Blogger and user disclosure: Even if a blogger is not being compensated in cash, they may have a relationship that requires disclosure. For example, if the person submitting a review or endorsement is getting a discount on a future purchase or being entered into a sweepstake for a significant prize, a disclosure is needed. Something as simple as sharing a photo may be construed as an endorsement.