Posts from — October 2009

Earlier this month, the FTC released “Guides Concerning the Use of Endorsements and Testimonials in Advertising“, which updates a prior document published in 1980.  Here’s the gist:

“When the Commission adopted the Guides in 1980, endorsements were disseminated by advertisers – not by the endorsers themselves – through such traditional media as television commercials and print advertisements. With such media, the duty to disclose material connections between the advertiser and the endorser naturally fell on the advertiser. The recent creation of consumer-generated media means that in many instances, endorsements are now disseminated by the endorser, rather than by the sponsoring advertiser. In these contexts, the Commission believes that the endorser is the party primarily responsible for disclosing material connections with the advertiser.”

At core, these changes are intended to correct for the fact that many “paid” endorsements are not self-evident as such to consumers, because of the (new) medium in which they are made. “We look at it from the perspective of the consumer and the principle being that a consumer has the right to know when they’re being pitched a product,” said Richard Cleland, assistant director of FTC’s advertising practices division. “It doesn’t matter whether it’s an email or Twitter or someone standing on a street corner.”

The guidelines go into some detail describing circumstances where the new rules apply, but bloggers are clearly a focus.  In particular, bloggers who enjoy a “material and ongoing relationship” with the advertiser.

For example: “A college student who has earned a reputation as a video game expert maintains a personal weblog where he posts entries about his gaming experiences. Readers of his blog frequently seek his opinions about video game hardware and software. As it has done in the past, the manufacturer of a newly released video game system sends the student a free copy of the system and asks him to write about it on his blog. He tests the new gaming system and writes a favorable review. Because his review is disseminated via a form of consumer generated media in which his relationship to the advertiser is not inherently obvious, readers are unlikely to know that he has received the video game system free of charge in exchange for his review of the product, and given the value of the video game system, this fact likely would materially affect the credibility they attach to his endorsement.”

What the FTC is looking for in these cases is that the “endorser” disclose his relationship to the advertiser — presumably, in the body of his blog post.  “Accordingly, the blogger should clearly and conspicuously disclose that he received the gaming system free of charge” — and, that the advertiser demand such disclosure of the endorser: “The manufacturer should advise him at the time it provides the gaming system that this connection should be disclosed, and it should have procedures in place to try to monitor his postings for compliance.”

Although these new guidelines target bloggers (like Christine Young) who trade favorable reviews for free stuff, there’s a clear implication here for affiliate marketers — whose material and ongoing relationship is of a slightly different nature.  This raises the question:  Are affiliate marketers now responsible for disclosing their relationship with sponsor programs whose products they may review?  The FTC guidelines don’t specifically mention affiliate marketing, but, given the obvious existence of a benefit exchange relationship between affiliates and advertisers, it seems likely that they will apply.  Affiliates don’t get free samples, but they do get checks in the mail when the links they place on their sites and blogs to advertisers’ sites result in a sale.