FTC Compliance Friendly Reminders

Praise by bark from Flickr (Creative Commons License)

Praise by bark from Flickr (Creative Commons License)

Bloggers, vloggers, and other social influencers frequently asked me about the rules regarding disclosure when partnering with companies and using affiliate links. With holidays (and therefore holiday gift guides) on the horizon, it seemed apropos to share some helpful reminder for how to comply with the FTC’s disclosure rules when you get free product or are compensated for providing a review.

It’s All About Transparency
The purpose of the FTC’s disclosure rules is transparency. When people consume content, they have a right to know whether the creator has a relationship with the company or product or whether it is 100% their independent opinion. Knowing that a person has a relationship with a company, which may or may not include financial compensation, will impact whether a person reads or view a post and how much weight or credibility to give it.

To comply with the transparency requirements of Federal law, social influencers must clearly and prominently label the content they were compensated to make as advertising to avoid misleading consumers.

Disclosure First
Many influencers put their notice that they were compensated for doing a post or that a post has affiliate links at the end of the content. This is likely insufficient to comply with the rules because consumers need to be informed before they form an opinion about a product that they’re reading a sponsored post or an ad.

In general, you should make a disclosure in the post itself and shortly before the reader receives the advertising message. The FTC recommends putting it in front of or above the ad’s headline. Additionally, the notice need to be clear and unambiguous language. To determine whether your disclosure complies with the FTC, consider your notice from the perspective of the reasonable consumer who’s seeing your content for the first time. Will he/she notice the disclosure statement and understand that they’re reading or seeing an ad?

The FTC says terms like “ad,” “advertisement,” or “sponsored advertising content” are likely to be understood but terms like “promoted,” or “sponsored by [XYZ]” don’t comply with the disclosure requirement because they could be interpreted as merely underwriting the content without influencing the statements made in it.

So what does this mean? If you write a review of a product that you got for free or got paid for writing the post about it, you have to disclose at the top of the post that you have a relationship with the company. If you use affiliate links, you have to clearly disclose those relationships as well, prior to posting the link. (In some circumstances, using the term “affiliate link” may be insufficient if the average consumer doesn’t know the difference between links and affiliate links. Yes, this happens – I recently attend a blogging conference where an attendee assumed that the terms “link” and “affiliate link” were interchangeable.)

Every Post, Every Platform
When you have a relationship with a company or are compensated for writing about a product, you have to disclose it to your audience every time you write about it – regardless of the platform it’s on or what device people use to access it. Every single time. (Yes, I know this is annoying, but it’s what the FTC requires.)

Disclosure is Everyone’s Responsibility
Everyone who is involved in the creation or distribution of native advertising should review the content to ensure that the required disclosure is present and that the material does not mislead the audience about the product or the relationship between the writer and the company. This includes middle men like ad agencies. If anyone is found to be in violation of the FTC rules about native advertising, they could be fined by the FTC – the company that created the product or service, the writer, and anyone in between who was involved – up to $16,000. That’s a stiff penalty for forgetting or refusing to disclose a relationship.

If you want to learn more about this topic, I recommend the FTC’s article, Native Advertising: A Guide for Businesses. If you want to chat with me about these issues, like how to incorporate these requirements into website terms of service or contracts with third party content creators, you can contact me directly or connect with me on TwitterFacebookYouTube, or LinkedIn. You can also get access to more exclusive content that is available only to people on my mailing list, by subscribing here.

FTC & Promotions – Always Disclose Relationships

My box of Mental Mojo - love this stuff! (Thanks to the owners for sending me free product!)

My box of Mental Mojo – love this stuff! (Thanks to the owners for sending me free product!)

My friends own a company called Mental Mojo – it’s a powder that contains caffeine and cognitive enhancers that you mix in water. I drink it when I’m tired – it helps me get my work done without making me jittery. (I love that it turns my water super nerd green, which reminds me of this infamous exchange between Data and Scotty on Star Trek: The Next Generation.)

Because I talk about it so much online, I usually get my Mental Mojo for free (and they’ve invited me to the taste test for the new flavors). I’m not a paid spokesperson for this company, but I do get benefits from promoting the product. As such, every time I talk about drinking free product, I need to disclose my relationship with this company – not just because it shows transparency, but because the federal law requires it.

FTC Rules about Promotions
The Federal Trade Commission has strict rules about making “clear and conspicuous” disclosures when a person has a relationship with a company. These rules apply to spokespeople, online contest participants, product reviewers, and companies that use affiliate links on your site. When you are compensated for giving an opinion, you have to disclose your relationship.

If you fail to disclose a relationship with a company, the FTC can fine you up to $11,000. And they can go after you or the company.

Even in 140 Characters
And don’t think for a second that tweets or other micro-form social media sites are exempt from this rule. At the very least, you have to include “#ad” on your post. It’s not enough to include a link to a site that includes the disclosure of your relationship.

Truthfulness and Transparency
Whenever you write a product review, whether it’s on a review site like Yelp, a product review blog post, or providing a quote for their website or LinkedIn profile, you must provide a truthful and accurate review of the product or service. Posting fake or embellished reviews (positive or negative) violates the FTC rules.

I’ve written product reviews and I appreciate that my editors respect the FTC rules by asking us to describe the benefits and drawbacks of each product we try.

Video Disclosures
If you do reviews in video form – including unboxing videos – you need to disclose when you get free product and provide honest reviews. The FTC says it’s not enough to have the disclosure in the video notes. You have to say it or post verbiage to that effect at the beginning of your video and possibly repeat this information throughout the video depending on its length.

This disclosure doesn’t have to be complex. It can be something like, “The guys at Mental Mojo sent me this free box of their product. Let’s try it out.” (If you are trying Mental Mojo for the first time, the flavor may be a bit strong. Until you get used to the taste, you may want to mix it with club soda instead of plain water. The carbonation helps take the edge off.)

Final Thoughts
Disclose disclose disclose. If you get a benefit from talking about a product or company online, disclose it. Whether it’s your employer, a client, or a company that sends you stuff for free – it should be crystal clear to anyone who sees your posts that you have a relationship with the company.

If you work with spokespersons or campaign partners, make sure part of your relationship includes an educational component about their obligation to disclose your affiliation whenever they talk about you on any platform.

I spoke about this topic earlier this year at Content Marketing World. Be sure to check out the follow-up article about this panel by Northeast Ohio Media Group.

If you want more information about this topic, please check out 6 Things to Know About FTC Disclosures When Working with Influencers or my book The Legal Side of Blogging: How Not to get Sued, Fired, Arrested, or Killed. If you want to chat with me about a specific question related to the FTC rules and promotions, you can contact me directly or connect with me on TwitterFacebookYouTube, or LinkedIn.

Telling the Truth when you get Free Stuff

Our Books Arrive by Jarkko Laine from Flickr (Creative Commons License)

Our Books Arrive by Jarkko Laine from Flickr (Creative Commons License)

One of the perks of being a blogger is sometimes you get free stuff. Companies will send you free things with the hopes that you’ll write about it. One of my writing gigs is product reviews for lawyers so I have to use various office gadgets and software and write about it.

If you are lucky enough to get free stuff in the mail or you review products as part of your job, there are some rules you need to know. By federal law, you have to do two things if you do product reviews:

Your review of the product must contain your true opinion about it that is not misleading.

You must disclose when you are compensated for giving your opinion.

This means that you have to be honest about what you think about a product and not feel compelled to say nice things just because you got it for free or paid for the review. And you have to tell the audience that you got a benefit for the review – perhaps so they can be aware of the potential bias. The disclosure doesn’t have to be a big deal – just a “XYZ sent me this product for free and here’s what I think about it.”

If you don’t follow this rule, you could be fined up to $11,000 by the Federal Trade Commission. They can go after the reviewer or the company who sent the product. I suspect they’ll go after who has money to pay the fine.

Legal Side of Blogging Book CoverA company that sends out free products to bloggers or reviewers should include a reminder to their reviewers that they need to comply with this rule. This rule also applies if you’re writing comments on other blogs or websites or writing original content for your own site.

This rule also applies to review sites like Yelp and Trip Advisor. If you’re a Yelper, your must only post accurate reviews and you can only review products and services you’ve used. A company can’t legally tell its employees to post exaggerating positive reviews about the company or fake negative reviews about their competition.

If you need a legal resource on this topic or anything related to the laws that apply to social media, I recommend my book, The Legal Side of Blogging: How Not to get Sued, Fired, Arrested, or Killed. It covers a lot of the major issues that apply to copyright and the internet. If you want to chat more about this topic, feel free to connect with me on TwitterFacebookYouTubeLinkedIn, or you can email me.

Please visit my homepage for more information about Carter Law Firm.