Cole Haan WestFarms
(Photo credit: Wikipedia)

 Disclosure: Not a lawyer. Don’t play one on the Internet. But I’ve studied the FTC endorsement guidelines. A lot. 

Yesterday news broke that the FTC had issued a warning to shoe manufacturer Cole Haan, notifying it that the disclosures used by consumers in its Wandering Sole contest on Pinterest were not sufficiently clear as to the potential material connection between contest entrants and the company. Said the letter (as quoted in MediaPost):

“We do not believe that the “#WanderingSole” hashtag adequately communicated the financial incentive — a material connection — between contestants and Cole Haan,” Mary Engle, FTC associate director for advertising practices, said in a letter sent to the retailer’s attorneys on March 20.

This represents an evolution in the FTC’s thinking with regard to disclosure of a sweepstakes or contest entry. In the early days, it did not explicitly require such a disclosure when a blogger mentioned a brand in a post to enter a sweeps or contest.  In part, because there was no material relationship between the parties, so there was nothing to disclose. And, for the most part, back then (2010!), in text-based formats like blogs and Twitter, sweeps and contest entries were often disclosed as part of the entry instructions. Hence no confusion.  [Facebook only allowed contest entries on pages recently.]

So what has changed? The endorsement guidelines are grounded in two basic concepts:

  • is there a material (compensated) relationship between the parties, and
  • is there a possibility of consumer confusion about the relationship?

In my opinion, the FTC’s thinking has evolved due to the prevalence of contest and sweepstakes entries, particularly on the highly visual Pinterest, that mimic organic endorsements, and do not have clear disclosure that they are a contest or sweepstakes entry. In other words, that the posting is motivated by a commercial incentive, not an organic interest in the product. Quite simply, all these sweeps and contests were causing too much consumer confusion.

The resolution is pretty simple, and follows the same simple guidelines that normal disclosure does. When possible, use natural language to disclose the relationship (Pinned for the Blah Blah Sweepstakes) and use clear hashtags (#sweepsentry) or @ addressing (@BlahSweepsEntry) to make it crystal clear. Using the hashtag or @ addressing is useful even if you also require a natural language disclosure as it makes it easier to track the entries. IMPORTANT: Make the proper disclosure part of the requirements to enter the sweeps or contest.

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Disclosure: I am Vice President, Influencer Marketing at BlogHer. Advertising and social media marketing programs are a significant source of revenue for my company and for the bloggers in our advertising network.

It’s not a secret that I am something of an ethics/best practices aficionado. As a result, I pay particular attention to the terms of service and acceptable use policies of the social platforms commonly used in sponsored programs. The good news is: I love it so you don’t have to :-)

Recently (1/31/2014),  Pinterest changed its Acceptable Use Policy (AUP) to explicitly prohibit both compensated pins and ads that could be confused with Pinterest content.

Specifically prohibited per the AUP :

“Create or show ads that look like or could be confused with Pinterest content (for example, embedding Pinterest actions like Pin, follow or unfollow in your ads)
Directly compensate users for Pinning, following or unfollowing” 

However:

a business can pay someone to help them put together a board that represents their brand. For example, it’s okay for a guest blogger to curate a board for a local boutique’s profile. We don’t allow that boutique to pay the blogger to Pin products to her own boards.”

How does this  impact brands that want to use Pinterest in their promotional efforts? Here’s my take.

Not Allowed:

Brands CANNOT compensate influencers to pin brand content on their own Pinterest boards. This includes asking them to curate from a pre-defined pool of content or Pinterest boards.

Allowed:

Influencers can create boards for brands on the brand Pinterest. Because the brand’s Pinterest is understood to be commercial, the board can include branded pins, and no further FTC disclosure is necessary.

Brands can license previously published blog content  to populate the brand Pinterest boards. These licensed pins can include branding. 

Finally,  influencers can create sponsored boards on their own Pinterest account using a theme that aligns with the brand messaging but does not specify content sources or include any paid branded pins. The board sponsorship would require disclosure per FTC requirements, as it is a compensated activity, but one that is more akin to an editorial sponsorship than sponsored advertorial.

Pinterest does not include an example of this type of board in the AUP update but I am confident that this is well within the policy. Here’s an example, built around the theme of beautiful things:

Sponsored Pinboard

That said, Pinterest can always change its mind about this, or any other policy in its Terms of Service or AUP, so it is wise to check the company’s blog for updates before finalizing any program.

In particular, if you want to do a contest or sweeps using Pinterest, something I generally do not recommend, the service regularly refines its policy on sweeps and contests. The current policy is much in line with the new position on compensated pinning. It states: “please don’t:

Suggest that Pinterest sponsors or endorses you or the promotion
Require people to Pin from a selection
Make people Pin your contest rules
Run a sweepstakes where each Pin, board, like or follow represents an entry
Encourage spammy behavior, such as asking participants to comment
Ask Pinners to vote with Pins, boards or likes
Require a minimum number of Pins”

 What do these changes mean for brands over the long term?  

Pinterest is still feeling its way around commercial use of the platform, and is simultaneously trying to maintain the authenticity of the experience that caused such dynamic growth while evaluating and building its own monetization models. Right now, it is being very restrictive on commercial use of the core functionality of the platform, much as Facebook did a few years ago.

Facebook has since loosened some (but not all) the restrictions it placed, particularly with regard to Pages (versus personal Profiles). I expect Pinterest will do the same: reserve some capabilities to itself while lightly loosening the restrictions in areas where it is not building its own solutions.

More to come, I am sure!

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