When I’m not here, I’m over here –

BlogHer: Disclosing Sponsorship on Twitter: It’s Not That Hard! Really!

Snapshot Chronicles: The evolution of community: BlogHer at 5.

This past weekend, I was in New York for the Travel Blog Exchange conference (TBEX). The primary reason I attended the conference was to represent Blog With Integrity on a panel about blogging ethics, but I also got some great tips and ideas for my somewhat neglected travel blog, Snapshot Chronicles Roadtrip.

This year, I’ve spoken at a number of conferences about integrity, disclosure and the FTC endorsement guidelines. In most cases, the audience doesn’t know very much about the guidelines beyond whatever version of the urban myths are circulating within the community. This is of course why the conference organizers invite Blog With Integrity and usually someone from the FTC and/or a lawyer.

The travel community  was grappling with the ethical issue of sponsored trips  well before the guidelines were revised last year. Travel bloggers are very passionate about ethics and receptive to the approach of best practices — disclosure policies that go beyond what the FTC minimally requires. In fact, many travel blogs already have published policies.

During the Q&A on Sunday, it was clear that the attendees wanted to comply with the FTC requirements,  but they were struggling a bit with exactly what had to be disclosed and how.

And then I had an “Aha” moment. Hard to believe that after all I have written about this topic for more than a year, there would be something I hadn’t thought of, but lo and behold, there was.

I broke it down to a simple equation for disclosure, which seemed to clear things up for a lot of the bloggers at TBEX.

Endorsement + Compensation = Disclosure Required

How to disclose

The best way to disclose to meet the FTC guidelines is within the post that contains the endorsement: “I was privileged to be hosted by…” “I was thrilled at the opportunity to take a trip to (place) courtesy of (sponsor).” And so on. It is not sufficient to disclose in your disclosure policy or About page.

However, I recommend that you also have  a disclosure & editorial policy on your page:

• to let your readers know what they can expect on your blog, especially casual readers or folks that find you through a search engine, and
• to inform marketers and PR people about your interests so they contact you with relevant, appropriate offers.

Relationships and SWAG

Another key point Mary Engle from the FTC and I both stressed on Sunday was the relationship between the marketer and the blogger. If the marketer is reaching out to specific bloggers with sponsored trips and free products, there is a compensated relationship that must be disclosed. If 300 bloggers all get identical SWAG (stuff we all get) at a conference, the reason they received it was as a member of a group, not as an individual. There is no relationship between the marketer and a blogger who got the SWAG. This is still true if distribution of the SWAG is managed using a list of bloggers at the conference entitled to receive it. A list doesn’t create a relationship. Communication between people creates a relationship.

That said, of course, you know my mantra — disclose anyway. The company that provided an item relevant enough that you decide to write about it deserves the props for supporting the conference SWAG bag.

Bloggers, journalists

A touchy subject was the idea that travel bloggers are being held to a higher standard than travel writers for mainstream media who don’t have to disclose. I’ve written about why the FTC doesn’t require disclosure from mainstream journalists many times, and won’t rehash it all again. The brief version is that it’s about the consumer reading the item, not the person writing it. If the consumer would understand that the endorsement was compensated  – in the case of a journalist, by his salary and probably the subsidy of his paper for the trip,  no further disclosure is required.

The predominant sentiment at the conference was that mainstream journalists should be required to disclose as well. I agree. Disclosure is a best practice, full stop, regardless of your publishing channel.

However, I reject the opposite argument, which wasn’t offered by the TBEX audience, but I’ve read elsewhere — if mainstream journalists don’t have to do it, why should bloggers? That’s grabbing the stick from the very wrong end.

I also think it’s counter-productive to worry too much about others. Focus on what you need to do to connect with your readers, provide them good information and entertaining writing, and be honest about any business relationships you have. Compensation or free product may not change your opinion or writing one little bit, but you have to let the reader make that call for herself. You shouldn’t attempt to do it for her.

Twitter?

How to disclose on Twitter always comes up during ethics panels, and Sunday was no exception. It’s also a bit more complex for travel writers taking sponsored trips, as opposed to someone reviewing a single product. A trip occurs over a period of time, and there are only 140 characters. If part of every tweet has to have a disclosure, the tweetstream would get pretty dull.

Mary Engle made an important clarification for us. You have to disclose that the trip was compensated or the product was free in tweets containing the endorsement of the sponsor/advertiser. When you are tweeting about something unrelated to the sponsor — for example,  your experience at a local museum or farmers’ market, there’s no need to disclose because you are not endorsing the sponsor.

Here’s my advice.

• Start your trip with a tweet acknowledging the sponsor (and linking to a post on your blog with more details if you have one)
• Be sure to disclose in some fashion in any tweets endorsing the sponsor: “I love my room at the Aruba Marriott #sponsor” “The beach at host hotel Swanky Resort is pristine.”
• If the trip spans multiple days, make sure you have at least one tweet per day that discloses that your trip is sponsored and by whom. The easiest way to do this is to spread out your endorsements of the sponsor

Related articles by Zemanta

• Eleven Urban Myths about the FTC Guidelines for Endorsements & Testimonials (getgood.com)
• Thoughts on the FTC investigation of Ann Taylor LOFT blogger event (getgood.com)

So many things queued up to write about, including last week’s New Comm Forum, a slew of bad pitches that folks have forwarded over the past few months (Douches, Snakes and Brand Ambassadors) and a great visit to the Dana Farber Cancer Institute yesterday to learn more about the Jimmy Fund.

But the FTC went public this week with the results of its first investigation under the new endorsements and testimonials guidelines, and that news trumps the other (more evergreen) topics.

As reported in Ad Age, the FTC investigated an event held by Ann Taylor LOFT in January to launch its summer collection. The company invited bloggers to attend a special preview of the collection; those that posted about the event within 24 hours were entered into “mystery gift-card drawing” with a value between $50 and $500. (More about the event on Jezebel: February 3, April 28)

Reported Ad Age:

The event and the unusual request for posts to be submitted for a prize received media scrutiny and caught the eye of the FTC. “We were concerned that bloggers who attended a preview on January 26, 2010 failed to disclose that they received gifts for posting blog content about that event,” Mary Engle, the FTC’s associate director-advertising practices, wrote in a letter dated April 20 to Ann Taylor’s legal representation.

According to the article, the FTC decided not to take further action because it was a single event, only a small number of bloggers participated (and some disclosed) and Ann Taylor subsequently adopted a written policy for blogger outreach.

This is exactly what the FTC said it planned to do all along. Its focus would be on advertisers, not individual bloggers, and the initial investigations would likely result in warnings, not indictments.

Taking the step of pursuing an action in the courts is a long expensive process. The harm to the public has to be pretty significant to merit the cost, especially if satisfaction can be obtained more efficiently, as it was here.  I suspect an uncooperative Ann Taylor might have resulted in a different outcome.

What can we learn from this?

The guidelines are intended to prevent deceptive advertising practices. The media may love the (erroneous) idea that the FTC is “cracking down on bloggers,” as Ad Age repeated again in this week’s article, but reality is, the larger burden is on the companies, not the individuals.  The FTC expects the company — the advertiser — to provide guidance to its WOM agents about the requirements. In the Ann Taylor case, there wasn’t much guidance.

While it isn’t covered in the Ad Age article, there was also an element of confusion in the event that probably concerned the FTC. This is entirely speculation on my part, but it’s a fairly informed one.

Basically, if you write about a company or product and subsequently get a gift, you aren’t required to disclose the gift. Unless of course you write about the company again. Further, if you win a sweepstakes or get a product in a swag bag, you don’t really have a material relationship with the advertiser. Your receipt of the product is random. Best practices may dictate disclosure but the endorsement guidelines do not.

Here we have a gift contigent upon a post. That’s compensation, albeit a little ugly. Not a gift. Disclosure required. But confusing.

This is compounded by the contest-like element of the mystery gift card drawing, which makes it look a bit like a sweepstakes. Except not really. Everyone who wrote a post got a gift card, and you had to get the initial invitiation to participate.  Relationship and compensation. Disclosure definitely required.

Bottom line, just a messy confusing campaign all around. Confusion for bloggers about whether they need to disclose, and little guidance from the company on the requirement. Confusion for consumers, because they don’t have the information they need to evaluate the blog posts.

The lesson for companies: Keep blogger outreach programs simple and easy to understand. Provide guidance and training to your word-of-mouth agents. And your employees, especially the ones charged with developing and executing social media programs.

The lesson for bloggers: Think twice about working with companies that don’t inform you that you need to disclose. Push back if you aren’t getting the information or support you need. Also, unrelated to this case specifically, but general advice: read agreements carefully. While I do not think companies can push their liability onto you, I wouldn’t be at all surprised if some tried. That’s just a mess you don’t want to get into.

What I highly advise you to NOT take away from the Ad Age article

A lawyer interviewed in the Ad Age article speculated:

“They’re [the FTC] probably throwing a little fire-starter into it, sending some messages out. The message this time is somewhere between $50 and $500 requires a disclosure.”

My head about to explode. I can just see this quote spawning a new urban legend that there is a minimum and maximum value that the FTC will look at, vis disclosure and enforcement. No no no no no. Compensation is compensation. $5 or $5000. Products or cash.

When in doubt, disclose. There’s never too much information when it comes to informing the consumer. You know. Us.

There’s still a great deal of misinformation about the Federal Trade Commission (FTC) Guidelines for Endorsements and Testimonials (FTC Guides or Guidelines) wafting around on the Internet, and from time to time, it makes its way into mainstream media stories.

We’re trying to chip away at it. Blog With Integrity did the two free Disclosure webinars last year. My colleagues and I leave comments with accurate information when we find posts and articles with errors. Just about every blogging conference since the beginning of the year has had a session about the Guides, and we’re doing the Bridging Brands and Bloggers webinar for PR, marketing and advertising professionals next Tuesday.

But the misinformation persists. So, it seems like the time is now for a little debunking of the urban myths about the FTC Guidelines.

MYTH: There’s an $11,000 fine for violations of the Guidelines.

FACT: The Guidelines explain how the FTC would apply Section 5* of the FTC Act to endorsements and testimonials. They are not rules or regulations, and there are no fines. Any penalties would be assessed by the courts as the result of a legal enforcement process during which the FTC would have to make its case for deceptive advertising.

* Section 5 broadly prohibits “unfair or deceptive acts or practices in commerce.”

MYTH: The FTC dictates how you should disclose.

FACT: There’s no checklist of  ”approved” ways to disclose. The Guidelines simply require  ”clear and conspicuous” disclosure of material relationships between sellers and endorsers when those relationships would not otherwise be clear to the consumer. The FTC  Guidelines do include examples to illustrate the conditions under which disclosure would be required. However, there are no specific prescriptions as to how the disclosure should be done.

If you are interested in best practices for disclosure, take a look at the slides from the general session I did at BlissDom in February.

MYTH: The Guidelines were revised because bloggers are unethical.

FACT: They were revised because it had been 30 years since they were first published. It was time for an update.  Initially because it had become clear that the way disclosure was being handled in traditional media for certain types of products  (like weight loss) wasn’t working as it should. In the process, it became clear that changes in the the media landscape, and specifically, the rise of social media, needed to be addressed.

MYTH: Mom blogs have been singled out for special scrutiny.

FACT: Absolutely not. This was confirmed by Mary Engle, the FTC’s Associate Director for Advertising Practices, during the Blog With Integrity webinar on November 10, 2009.

The FTC Guidelines apply to endorsements and testimonials in all types of marketing including viral,  WOM, blogs, TV, radio and print.

MYTH: Bloggers are being held to a higher standard than journalists.

FACT: The issue at hand isn’t standards or even ethics. The Guidelines are all about making sure that the consumer has enough information to evaluate the endorsement or testimonial. If she would not reasonably expect a material relationship to exist or would not understand it without the disclosure, the endorser should disclose. If the context is clear, disclosure is not required.

In the case of the mainstream media, consumers generally understand that the reporter didn’t buy the item or choose his own topic, and can evaluate the report accordingly. We make different assumptions about people “just like us,” thus disclosure is necessary. A blog or website that operates just like a magazine would be treated like a mainstream magazine because the consumer, or reader, would have the proper expectation. More on this topic in this post.

MYTH: Celebrities are not subject to the guides.

FACT: There are specific examples about celebrity endorsements. The litmus test is the consumer’s expectation. If we would understand the relationship — for example a celebrity athlete wearing logo gear — no disclosure is necessary. We assume a compensated relationship. If the consumer wouldn’t understand the paid relationship, disclosure is required. More on this topic in this post.

MYTH: The FTC said that X was (or was not) a violation.

FACT: The FTC does not speak about specific cases. This could compromise ongoing investigations. More importantly, if it were you, or your company, would you want the FTC passing comment before a full investigation had been completed? I wouldn’t.

MYTH: The FTC is gunning for bloggers.

FACT: The FTC has stated on more than one occasion that its enforcement attention is focused on advertisers and companies, not on individual bloggers.

MYTH: The FTC guidelines violate the 1st amendment.

FACT: The FTC guidelines apply to commercial speech. Compensated, material relationships. They do not apply to opinions where there is no material relationship. If you are paid for your opinion — even if you can say whatever you want — it’s commercial speech. Commercial speech is paid speech. Not free speech.

Free speech is still free. And protected.

MYTH: All you need is a disclosure policy.

FACT: A disclosure (or editorial) policy is a best practice. You still must disclose within the post or tweet if you have a material relationship with a seller.

MYTH: The FTC guidelines will destroy the blogosphere.

FACT: So far, not so much.

Disclaimer:  I am not a lawyer and do not play one on the Internet. This post is my opinion based upon analysis of public records, including the FTC Guidelines.

This post also appears on BlogHer.

Apart from my rather hectic return North on Friday (which you can read about on Snapshot Chronicles Roadtrip), BlissDom was absolutely great, and I wish I could have stayed longer.

BlissDom and Disclosure

As promised, here is a PDF of the complete slide deck from the “You Should Know Better” general session on Friday morning. Kristen Berman from Intuit covered best accounting practices, Liza Barry-Kessler gave an overview of the legal issues facing bloggers in their small businesses, and I talked about disclosure as a best practice and the FTC guidelines on endorsements and testimonials.

We were lucky that Stacey Ferguson was in the audience. She is an attorney with the Federal Trade Commission advertising practices division and was able to help answer a few questions.

I don’t want to dive too deep into disclosure in this post but one thing most definitely bears repeating: the FTC does not dictate how you should disclose other than it must be “clear and conspicuous.” There are many ways to be clear and conspicuous. For example, put the disclosure at the top of the post, at the top of the blog sidebar or within the text of the post as you write about whatever it is. All pretty clear. You just have to be sure that the reader has an opportunity to see the disclosure without searching for it. But… there is no checklist that says the FTC approves these five ways to disclose and does not approve these other five.

That’s why best practices are so very very important. Also common sense. For example, if you have written a long, long blog post, putting the disclosure at the bottom of your post, and only at the bottom, isn’t too conspicuous. No one says you can’t put it there — not even the FTC —  but I will tell you that it’s not a best practice.

On the other hand, if you write snappy short product bits that fit in the first screen (“above the fold”),  a disclosure at the bottom of the post is pretty conspicuous. It’s simple common sense – just ask yourself, if I was reading someone else’s blog, where would I want to be informed about the endorsement or material relationship?

Stacey also made it clear to the audience that the FTC does not require that blogs have a disclosure policy nor does a blanket disclosure policy cancel out the need to disclose in your posts.

Best practices demand that you do MORE than the FTC requires. A disclosure policy is a best practice that helps your readers understand your point of view, your relationships and your biases.  Use best practices and common sense, and you should be fine.  The slides from the BlissDom session have some suggestions, and Blog with Integrity will have more free webinars on this and related topics like copyright and fair use.

Super Bowl Ads
Liked: Snickers, VW, Clydesdales [Updated 2/9 to add that I also liked the NFL, Google and HomeAway ads, all of which were spot-on in their branding]
Didn’t like: All the misogyny (Dodge, Bridgestone, Dove, Go Daddy), creepy eTrade babies, people acting like dolphins, stuffed animals acting like people

Survey for Professional Blogging for Dummies
I’m heads down most days on my book right now, and I’d like your help. A key feature in the book is case studies, anecdotes and tips from successful bloggers. I’d also like to have some trend data about professional blogs. How are people making money? Do they have a business plan? What sorts of opportunities have bloggers gotten as a result of their blogs? So, I’ve got a little survey up on Survey Monkey. If you write a professional or small business blog, I hope you will take it.

Recently, a blogger friend noticed that the disclosure policies on some of the blogs she was reading effectively said that the blogger didn’t necessarily disclose compensation:

The compensation received may influence the advertising content, topics or posts made in this blog. That content, advertising space or post may not always be identified as paid or sponsored content.

I recognized the language immediately as language from disclosurepolicy.org’s Disclosure Policy Generator, but thought that certainly the tool would have been updated to reflect the requirements set out by the FTC guidelines on endorsements and testimonials. A disclosure that you don’t disclose is not in compliance.

Nope. The option is still in the generator.

While it is better to write your own policy, in your own words, I do understand the appeal of widgets. Do yourself a favor, though. If you use disclosurepolicy.org, tweak it to fit your circumstances, and definitely make sure you don’t have this language in your policy.

Last week, I was a guest on After Hours with Andrew Bell, a financial news program on Canada’s Business News Network. Think of it as the Canadian equivalent of Bloomberg News. Topic: the new FTC guidelines and potential impact on companies. You can watch it online here.

Later this week, I’ve got a bad pitch to share with you but I want to spend some time on the post, a luxury I do not have today. I thought I’d get us all in the mood by sharing a few blogger relations tips.

Good blogger outreach has to go beyond the product and its features. That brilliant features-based pitch with the clever tagline you are about to send? May be enough for the blogger to consider buying your product, but I can almost guarantee you, it will not be sufficient to get him to write. You’ve got to go beyond the features, and tap into something the blogger really cares about.

If you are planning any programs aimed at mom bloggers, take 13 minutes and listen to this 360 Public Relations podcast. It was taped at last fall’s Mom2Mom Summit, and features top mom bloggers and marketers discussing what works, and what doesn’t, in the mom social media space. Full disclosure: I edited the podcast for 360.

Broken record though I may be, do not forget that, as of December 1, if you compensate a blogger, whether in cash or free products, the new FTC guidelines on endorsements and testimonials require you to:

• inform the blogger that she has an obligation to disclose,
• monitor for compliance as well as accuracy of product claims in any resulting posts and
• take steps to correct inaccuracies.

While this is not retroactive, if you are in the middle of a program, I would err on the side of caution and comply with the new Guidelines.

The new FTC guidelines for commercial endorsements and testimonials take effect today. How will that impact social media outreach programs?

Here are my predictions.

Companies and agencies that practice good blogger relations will continue to do so. They achieve excellent results by building close relationships with bloggers and developing targeted, relevant programs for their communities. They probably already do most of what the FTC requires simply because it is best practice.

However, there won’t be nearly as much free expensive, high-end product going around. Or costly boondoogle trips.  Companies will, and should, be much more careful about big programs and selective about who they invite to participate.

This may result in a shake-out in some blogging communities. Bloggers who write because they love to write will continue to do so. Bloggers who blog for the free stuff? If the flow dries up? Maybe not.

Hopefully, it will also result in more creative programs that add value to the community and the brands.

On the other hand, there’s going to be more mass marketing. Guaranteed, there will be more spammy press releases. Addressed to Blogger.

Twitter broadcasts. Lots, lots, lots more contests on Twitter. And not just trivia, which is at least amusing. Tweet “brand name and #hashtag” to enter.

Why? Because when it’s mass and untargeted, there’s no material relationship to disclose. In this context, Facebook’s decision to impose tighter controls on sweepstakes and contests makes a lot more sense, doesn’t it?

Mass isn’t always bad. Brands will use conference swag bags even more widely to distribute free samples of inexpensive and even moderately priced products. This supports the community as well as the bloggers, and goes in my column of good consequences.

So far, there are at least three different models for Twitter disclosure. By January, I bet there will be a few more, and one or more will have a monetization strategy. [I'll be writing about these models later this month.]

Measurement and monitoring tools will add functionality to track disclosure statements on blogs.

There will be at least one FTC enforcement action in the social media space next year. My guess is that it will fit one of these three situations:

• a company or agency does not properly inform the people participating in its word of mouth or blog marketing program of their obligation to disclose;
• an astroturfer, i.e. a company stuffing review sites with unattributed positive reviews of its products;
• an affiliate marketer does not monitor or correct inaccurate statements about its products made by affiliates.

Someday, an astroturfing company is going to try to claim “rogue employee” as a defense, and offer its social media policies and training programs as evidence, but it will turn out that the employee — probably an intern — was directed or at least subtly encouraged to post the fake reviews.

Bloggers will figure out how to disclose their affiliate marketing relationships when linking in posts.  For example, Mir Kamin is now using hover text on affiliate links on her shopping blog Want Not,  an elegant and relatively non-obtrusive solution. Read her  disclosure page for the details.

It won’t take long for most of us to get used to this brave new world. Even celebrities.  We’ll make a few changes. Think about things a bit more carefully. And just get on with it.

Until the next thing that is.

***

Other posts and articles this week about the guidelines:

• Mom-101 is celebrating Happy FTC Disclosure Day
• Boston Mamas: My Editorial Code
• Post Tech, New blogger payola disclosure rules start
• Boston Globe, Product Placement
• Ad Age, New FTC Rules Won’t Deter Celebrity Social-Media Endorsements

As I noted in last week’s post, companies using social media marketing tactics have an equal, if not greater obligation, than bloggers under the revised FTC guidelines. It just hasn’t gotten as much media coverage. In part because the story isn’t as  provocative as “Bloggers are Shills! Big fines!” and in part because it’s not news. The advertiser has ALWAYS had liability under the deceptive advertising statues.

In short, companies using word of mouth marketing and their agencies are required to:

• Disclose their relationships when posting, commenting or tweeting. Including reviewing products on websites. Let’s call this the anti-astroturfing provision;
• Provide guidance to people participating in their campaigns about their obligation to disclose;
• Monitor to ensure both compliance with the disclosure requirements and accuracy of information;
• Take steps to correct inaccurate or misleading information.

What does this mean in practical terms?

Companies must revise their social media policies to require employees to identify themselves as interested parties when posting or commenting about the company and its products. This does not preclude the ability to post anonymously. It’s not the employee’s name that’s important. It’s the fact of employment. What you are — an employee — is more important than who you are — your name. The same requirement applies to agencies acting on the company’s behalf. If you work for Brand X’s PR firm and leave a comment on a review site, you’d better identify yourself. Companies also must train all employees about the disclosure requirements and their responsibilities.

Companies engaged in blogger outreach and word of mouth marketing programs must inform participants about the obligation to disclose. In my opinion, this advice must be specific to the program, not a generic statement about the need to disclose.

Updated to add: I think affiliate marketers are obliged to provide disclosure guidance to their affiliates, and expect responsible affiliate programs will be making changes to their agreements to reflect both the disclosure requirement and the affiliate’s (the blogger’s) responsibility. Assuming, as I do, that affiliate marketing will be under the FTC’s microscope, I would not be surprised to see non-compliance as grounds for removal from the program.

The company’s monitoring program must be fine-tuned to look for the proper disclosures as well as the mention of the brand. Processes must be developed to surface and correct inaccuracies and other misleading statements, including,  I imagine, missing disclosure statements.

And, of course, all of this must be carefully documented should it be needed as a defense in an enforcement action. You can’t just say you did it. You have to be able to prove it.

Every time I post about the FTC’s guidelines for endorsements and testimonials, I hope that, this time, the misinterpretations and disinformation will stop. So far, I remain disappointed, but ever optimistic, here I go. Once More, with Feeling.

Last week, Blog with Integrity hosted a webinar featuring Mary Engle from the FTC’s Bureau of Consumer Protection. We had the opportunity to ask Mary a number of questions about the guidelines. Here are  some highlights of the conversation:

• The FTC does not intend to pursue individual bloggers. Its focus is on the companies and advertisers who are engaging with word of mouth marketing in ALL its forms, not just blogs. This includes Twitter, Facebook, review sites and word of mouth programs that use street teams.
• The FTC wants the companies to provide guidance to the people working with them on word of mouth marketing programs.
• The guidelines do not carry penalties or fines.
• The guidelines affect all bloggers who directly participate in marketing programs, not just mom bloggers as has often been portrayed in the media.
• Disclosure statements need to be clear and prominent. A blanket statement might be okay, depending on the circumstances, but it shouldn’t be at the bottom of the page, as the reader might not get that far.
• If a blog operates like a magazine — with clear editorial guidelines, editors, assignments, etc., the FTC likely will treat it the same way as a mainstream media magazine.
• The contents of swag bags at conferences, distributed to all attendees, are more like the example in the guidelines in which the blogger received a grocery coupon for a free bag of dog food. Recipients aren’t selected individually and personally, so there is no relationship to disclose.
• The FTC cannot provide specific guidance as that might compromise ongoing investigations.
• The consumer’s understanding of the commercial message is the crux of the matter.  Mary’s final slide stated: “Does the reader/audience understand the relationship between the reviewer and the company whose products are being reviewed?” If not, disclose.
• The FTC will continue to add resources to its website to help consumers and companies understand the guidelines, and questions can be emailed to endorsements@ftc.gov

Bloggers and journalists

We didn’t reach as much clarity about bloggers being held to a different standard than journalists.  Mary tried to explain the FTC’s position, but from the questions both during and after the session,  folks are still reacting to this as a statement about an ethical difference between a blogger and a journalist. It’s not. It’s about the consumer’s understanding of the different channels. Here’s the text:

The Commission acknowledges that bloggers may be subject to different disclosure requirements than reviewers in traditional media. In general, under usual circumstances, the Commission does not consider reviews published in traditional media (i.e., where a newspaper, magazine, or television or radio station with independent editorial responsibility assigns an employee to review various products or services as part of his or her official duties, and then publishes those reviews) to be sponsored advertising messages. Accordingly, such reviews are not “endorsements” within the meaning of the Guides.  Under these circumstances, the Commission believes, knowing whether the media entity that published the review paid for the item in question would not affect the weight consumers give to the reviewer’s statements. Of course, this view could be different if the reviewer were receiving a benefit directly from the manufacturer (or its agent).

In contrast, if a blogger’s statement on his personal blog or elsewhere (e.g., the site of an online retailer of electronic products) qualifies as an “endorsement” – i.e., as a sponsored message – due to the blogger’s relationship with the advertiser or the value of the  merchandise he has received and has been asked to review by that advertiser, knowing these facts might affect the weight consumers give to his review. (page 47, Federal Register Notice)

I wrote about this at some length in an earlier post, and won’t repeat everything here, but I’d like to suggest that we stop worrying about the semantics of journalists versus bloggers, and instead turn our attention to the issue of form versus content. Discussing the issues in the context of mainstream media or blogs focuses on form. But forms are fluid. They change. We need to stay focused on content. Is it a commercial message? If so, and the commercial nature is not clear from the context,  it needs to be disclosed, regardless of form. An ad that looks like the front page of the New York Times is an ad, regardless of form. A website that offers editorial content mixed with advertisements is more like a magazine than a personal blog, even if it happens to be published using blogging software.

Was the FTC as clear as it could have been on this issue? No, but I am hopeful that its workshop in early December on the Future of Journalism will move it, and us, closer to a better understanding.

[11/17 - update on this issue below]

Affiliate marketing

Our discussion during the webinar also made it clear that we — consumers, bloggers, policymakers and regulators alike – need a much better understanding of affiliate marketing. Clearly, there is a commercial relationship between a seller and its affiliates, but there are many variations on the theme, and more than a few different types of affiliate ads, from entire websites that are nothing more than an advert to display ads on blogs to deep links within posts. There were many many questions about this both during and after the session. Understandably, bloggers want specific guidance from the FTC,  and that just isn’t going to happen. Blog with Integrity may do a webinar next year on affiliate marketing, and we would love your feedback on the idea.

Did you know – COMPANIES are liable under the guidelines too!

The FTC has been pretty clear where it thinks specific guidance should be coming from –  the advertisers. Companies also have specific disclosure and monitoring responsibilities. Unfortunately, that part of the guidelines hasn’t gotten nearly as much media attention as the blogger liability. Here are the specific examples, emphasis mine:

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 misleading or unsubstantiated representations made through the blogger’s endorsement. The blogger also is subject to liability for misleading or unsubstantiated 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.

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.

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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. 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. Accordingly, the blogger should clearly and conspicuously disclose that he received the gaming system free of charge. 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.

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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.

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Example 9: A young man signs up to be part of a “street team” program in which points are awarded each time a team member talks to his or her friends about a particular advertiser’s products. Team members can then exchange their points for prizes, such as concert tickets or electronics. These incentives would materially affect the weight or credibility of the team member’s endorsements. They should be clearly and conspicuously disclosed, and the advertiser should take steps to ensure that these disclosures are being provided.

In short, companies using word of mouth marketing and their agencies are required to:

• Disclose their relationships when posting, commenting or tweeting. Including reviewing products on websites. Let’s call this the anti-astroturfing provision;
• Provide guidance to people participating in their campaigns about their obligation to disclose;
• Monitor to ensure both compliance with the disclosure requirements and accuracy of information;
• Take steps to correct inaccurate or misleading information.

Are companies and agencies doing this? How about the big blog networks? If they aren’t doing it now, they’d better be by December 1, 2009, because that’s where we are likely to see the first enforcement actions. The FTC has said so more than once.

Bet that’ll get a little media attention.

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Some additional reading

Blogging Moms Wooed by Food Firms – My rambly two cents on the LA Times Article (Mom 101)
Using Bloggers as Means, Not Ends Unto Themselves (Jeremy Pepper)
Clarification and commentary on new FTC advertising and endorsement rules (The Practical Nomad)

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11/17 Update – We are forwarding post-webinar questions we get about the FTC guidelines to the endorsements@ftc.gov email address. I sent one this morning, and got an automated reply with five FAQs, including this one, which should clear up the blogger/journalist confusion:

3. “Aren’t you holding bloggers to a higher standard than people who review products for newspapers or on TV?” No, the Endorsement Guides apply across the board. The issue is – and always has been – does the audience understand the reviewer’s relationship to the company whose products are being reviewed? If yes, then a disclosure isn’t needed. If no, then a disclosure is needed. Here’s why that’s the case. For a review in a newspaper, on TV, or on a website with content similar to what you’d find in a publication or on TV, it’s usually clear to the audience that the reviewer didn’t pay for the product being reviewing. It’s their job to write reviews and no one expects that they paid for what they’re reviewing. But in other instances – for example, on a personal blog or social networking page – the reader wouldn’t expect the reviewer to have a relationship with the company whose products are mentioned or reviewed. Disclosure of that relationship helps the audience evaluate potential bias and avoid deception. That’s the long and short of what the Guides are all about. And, as usual, we’ll be focusing our enforcement efforts on the advertisers, not on individual endorsers.

Yup, that’s what I thought. Nice to hear it directly from the FTC.