FTC Deals Blow to Paid Endorsements Online

Have you ever paid for a tweet or a link placement within a blog post? Then listen up! The latest round of FTC regulations have further tightened rules and expectations when companies pay for endorsements on new media properties like blogs and social networks.

It is important to remember that these new rules are not applicable to organizations that earn endorsements by providing great content. Alternatively, the FTC wishes to protect the consumer, stating that “consumers have a right to know when there’s a material connection between an advertiser and an endorser”.

The first round of major online endorsement rules were released in 2009 FTC Guide that were mostly in response to the rising use of online reviews on eCommerce websites. This document also made history by being the first FTC regulation to specifically mention paid endorsements on social media properties such as blogs and social networks. Through 8 examples, the 2009 document made it clear that paid endorsements on blogs and social networks had to contain a specific disclosure within the content which made it clear to a consumer that it was a paid endorsement. This document had a large impact on the many SEO companies at the time that were paying for links on blogs to earn top positions in search engine rankings.

According to the Content Marketing Institute, there are additional guidelines that refer to making sure that disclosures are visible on multiple device types, requiring responsive HTML programming. Also, advertisers need to be clear and not rely on cryptic hashtags (such as #SPON) or other methods of disclosure that may not be clear to the average reader.

The main point here is that paid relationships with endorsers need to be clearly identified regardless of:

Social Network – these guidelines apply to everyone equally.

Space constraint – yes, you have to fit at least the #sponsored hashtag in your precious 140 Twitter characters (well, now its 130 characters).

Screen type – no matter if you are viewing the message on the most outdated or latest devices, the disclosure must be visible! This shouldn’t be an issue since social networks do their best to provide equal experiences across devices.

Here’s a quick video from the FTC on endorsement guides for advertisers:

Image credit: Sam Howzit

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