After years of bloggers writing favorable reviews of products in pay-for-play deals with marketers, the FTC stepped in to treat these sorts of endorsements the same as more traditional print and broadcast marketing campaigns. The new guidelines went into effect in December 2009.
These revisions were made to ensure transparency in endorsements, and the revised guidelines are pretty clear on the duties of both marketers and bloggers who endorse their products/services. In essence, any “material connections” between the company making the product/service and the endorser must be disclosed. These “connections” include any benefits the endorser receives from the company that “might materially affec the weight or credibility of the endorsement,” particularly when the audience would not reasonably expect there to be such a connection.
This usually entails receiving free products or services from the company in exchange for a positive review. An article on mashable that gave examples such as General Mills sending out samples and previews of new cereal and yogurt products to bloggers for reviews, and Ford giving its new Fiesta car to bloggers for a year (with a gas card) in exchange for reviews. While no money changed hands, these benefits would clearly need to be disclosed under the guidelines.
Similarly, I would caution bloggers to disclose any relationship that confers a benefit – even if its discounts or coupons on products or chances to win a gift card in a blog contest. The point of the guidelines is to make it clear to the audience if something is motivating the blogger to slant his or her review of a product/service.
The disclosure must be “clear and conspicuous,” as well. For example, requiring readers to click through to a separate disclaimers and disclosures page probably won’t cut it. The disclosure – “I received XYZ from the company in connection with the publication of this review” – should be on the same page in a place that would be easy for the reader to see.
The revisions are in the updated Code of Federal Regulations (16 CFR section 255). In one example the FTC gives, a blogger who usually uses one brand of dog food buys “a new, more expensive brand made by the same manufacturer.” She then writes a positive review about how her dog’s coat was “noticeably softer and shinier.” Because she used her own money and was not affiliated with the manufacturer, no disclosure is required. If the manufacturer sent her a coupon for a free trial of the new dog food without any knowledge that she would blog about it – in the FTC example, because a computer program had tracked her purchases and thought she may be interested – again, she would not be required to disclose this. BUT, if the blogger is part of a “network marketing program under which she periodically receives various products about which she can write reviews if she wants to do so,” then she would need to disclose that she received a free bag of dog food in connection with her review.
This isn’t just for bloggers. Posting endorsements of products on message boards or in other online product review forums should also be disclosed. I think product reviews on Amazon and restaurant reviews on Yelp would require disclosure of these relationships, for example.
What are the consequences for violating these guidelines? The initial fears making the rounds on the Web were that the FTC would fine violators up to $11,000 for a noncompliant post. An assistant director for the FTC quelled that, saying it was “not true” and that for first-time violators, the process would more typically be receiving a warning, followed by a cease-and-desist letter, with no monetary penalty for a first violation. (see article on Fast Company) Only if a blogger went so far as to refuse the cease-and-desist letters to the point of violating deceptive advertising laws – something that would require the FTC to bring a legal action in court to enforce compliance – would a fine or other penalty be a possibility.
The takeaway: Bloggers writing reviews of products must disclose benefits they receive from the company marketing that product. The FTC considers these to be endorsements. The disclosure must be clear, not hidden away elsewhere on a blog. First-time violators may get a slap on the wrist, but consequences could be worse for those choosing to ignore FTC letters.
