The FTC is NOT gunning for mom bloggers

by Susan Getgood on May 19, 2009 · 25 comments

in Blogger relations,Blogging,Ethics

Articles in the mainstream press, like this one today in BusinessWeek, give the impression that somehow the Federal Trade Commission is targeting mom bloggers for “enforcement.” Poppycock.

The FTC is doing a review of its guidelines on endorsements and testimonials. That’s part of its job — to protect the consumer from deceptive advertising practices. In 2007, it published notice of its intent to review these guidelines and solicited comments. Last year, it published this document, soliciting additional comments, which were accepted until earlier this year.

In the process, new media got added to the mix because word of mouth marketing, whether done by guerrilla marketing agencies or bloggers, is a new form of endorsement.

The question then becomes is it a commercial endorsement or not. If commercial — if it qualifies as advertising — then the guidelines may apply.

Why is this an issue for mom bloggers?

Not because the FTC is targeting them. It is not. However, consumer products companies are, big time. Bloggers are being asked to endorse products in a variety of ways, from sponsored posts to free product to big events and trips. So, what is the real impact of the possible changes to the guidelines?

A long time ago, when I wasn’t much older than my son is now, I thought I wanted to be a lawyer. Which may explain why I still get off on reading 86 page policy documents from the FTC. The good news is, I do, so you don’t have to. Today, I reviewed the FTC call for comments on the guidelines, the most recent public document we have.  Here’s the scoop.

The bulk of the 86 page document focuses on deceptive use of testimonials in advertising, largely for weight loss, baldness and other pharmaceutical (and quasi pharmaceutical) products.  Disclosure of the relationship among the parties and substantiation of claims are the main themes.

There are only three examples related to blogs. The citations are the direct quotes from the document; headlines and emphasis mine.

Number one: Liability for false statements in a sponsored post.

“Example 5: A skin care products advertiser participates in a blog advertising service. The service matches up advertisers with bloggers who will promote the advertiser’s products on their personal blogs. The advertiser requests that a blogger try a new body lotion and write a review of the product on her blog. Although the advertiser does not make any specific claims about the lotion’s ability to cure skin conditions and the blogger does not ask the advertiser whether there is substantiation for the claim, in her review the blogger writes that the lotion cures eczema and recommends the product to her blog readers who suffer from this condition. The advertiser is subject to liability for false or unsubstantiated statements made through the blogger’s endorsement. The blogger also is subject to liability for representations made in the course of her endorsement. The blogger is also liable if she fails to disclose clearly and conspicuously that she is being paid for her services. [See § 255.5.]

In order to limit its potential liability, the advertiser should ensure that the advertising service provides guidance and training to its bloggers concerning the need to ensure that statements they make are truthful and substantiated. The advertiser should also monitor bloggers who are being paid to promote its products and take steps necessary to halt the continued publication of deceptive representations when they are discovered.”

Number two: Disclosure of receipt of free product

“Example 7: A college student who has earned a reputation as a video game expert maintains a personal weblog or “blog” 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. The readers of his blog are unlikely to expect 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 would likely materially affect the credibility they attach to his endorsement. Accordingly, the blogger should clearly and  conspicuously disclose that he received the gaming system free of charge.

Number three: Anti-astroturfing. Requires disclosure of material interest when making an endorsement.

“Example 8: An online message board designated for discussions of new music download technology is frequented by MP3 player enthusiasts. They exchange information about new products, utilities, and the functionality of numerous playback devices. Unbeknownst to the message board community, an employee of a leading playback device manufacturer has been posting messages on the discussion board promoting the manufacturer’s product. Knowledge of this poster’s employment likely would affect the weight or credibility of her endorsement. Therefore, the poster should clearly and conspicuously disclose her relationship to the manufacturer to  members and readers of the message board.”

So what’s the big deal? Doesn’t this all make sense?

It will come as no surprise to readers of this blog, but apparently to some: businesses do not always act in the best interests of consumers. Sometimes they even lie. That’s why we’re in a recession.

The FTC protects us from deceptive practices in advertising, and extending the policies to social media that qualifies as commercial speech makes sense. If you are a blogger, that may include some of your writing. But please don’t over-react. The FTC is not interested in honest reviews of products by bloggers.

It is interested in protecting the consumer. Us.

What should bloggers do?

Well the document I read today merely outlines the direction the FTC was taking. The final guidelines could be slightly or even very different. Nevertheless, I’ll stand by my original post on this topic (Bloggers liable for statements about products? Maybe says FTC ) and say that the key issues will be compensation and disclosure. To what extent is the blogger a proxy for the advertiser?

In that context, here’s my advice. Keep in mind:  I am not a lawyer and I do not play one on the Internet.

1. Whether you write paid posts, go on paid trips or take free products for review, or not, review your blog disclosure policies. Are you clear about your interests and affiliations?

I have three blogs, and each has a slightly different policy. Marketing Roadmaps accepts no advertising whatsoever. Snapshot Chronicles, my personal blog, runs BlogHer ads and is an Amazon affiliate. Snapshot Chronicles Roadtrip, my new family travel blog, accepts review product and advertising with the policies clearly spelled out.

For reference, here’s the general policy for the Snapshot domain and for the domain that hosts the Marketing Roadmaps blog. Every blog I build for a client has a similar policy. Every one.

If you feel better having a lawyer review your policy, go for it. Especially if you are making money from your blogging or you are in partnership with other bloggers. It’s your business. Protect it.

2. If you accept compensation for a blog post, disclose the payment. If the post was written as part of a blog network, even if you are not compensated directly but the network is, disclose. When in doubt, disclose.

3. If you accept free product, whether or not there is an explicit agreement for a review, if you do the review, disclose. Also, as Erin Queen of Spain pointed out on Twitter today, don’t forget your tax liability for free products. Personally I think it far more likely that the IRS will come knocking than the FTC. Cover yourself.

4. Be careful about claims you make about the products. In the skincare lotion example, there’s a big difference between saying “This cream cures eczema” (Wrong) and “This cream really helped my eczema.” (Specific, probably acceptable). In advertising, commercial speech, general claims must be substantiated.

5. It would be nice, wouldn’t it, if the FTC would say something like free product over $x dollars is subject to the guidelines, but under, it is not. Abandon that hope. It won’t happen. Absolute numbers are a policy mistake, and one that I do not see the FTC making in this case.

Use your common sense. If you take a book or DVD or baby sling to review, something you might purchase anyway, the FTC probably isn’t going to spend any time worrying about deception in your review. Sorry.

A new car? A free trip? A suite of brand-new appliances? Uh. Yes. These are levels of compensation that may get some scrutiny. Should that prevent you from participating in a blogger program? Absolutely not. Assuming everything about the program is kosher, that would be stupid. The FTC is focused on deceptive practices, not honest reviews.

Stay on the side of the angels. You’ll be fine.

This post has focused on the blogger side of the blogger relations equation. In the next few days, I’ll share some thoughts on how the proposed changes might impact what companies and agencies do.

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