The FTC requires any influencer with a material connection to the brand to clearly and obviously disclose that material connection any and every time they promote the product.
The FTC applies the same rules to influencer marketing that they do to all other types of advertising: the influencer must disclose if they’re being compensated by the brands they’re promoting. The FTC has tips to help your company comply with the law. 41-58, three sections of the 1972 proposal as final guidelines (16 CFR 255.0, 255.3 and 255.4) and republished three others, in modified form, for additional public comm… In that sense, the problem, it seems, is quickly solving itself. In fact, if he were paying attention, he even would know how much each tweet, post, or product placement contributed to the bottom line. As I said, disclosure (and arguably common sense) is at the heart of these issues. If you pay an influencer to pitch your product on social media, but it’s not obvious that person is being paid to pitch the product, that’s misleading. Where you make the disclosure will depend on what’s “central” to the post. But the law says they also have to be truthful and not misleading. Consumer Review Fairness Act: What Businesses Need to Know. Whether you’re an influencer or a brand marketer, the question is: are you ready for tougher scrutiny by the FTC? What about a free sample? As mentioned in Chopra’s statement, the Commission wants to review the current Endorsement Guidelines and is now seeking public comment: FTC Seeks Public Comment on Its Endorsement Guidelines. You can learn more about consumer topics and file a consumer complaint online or by calling 1-877-FTC-HELP (382-4357). Related: Mike Bloomberg Goes Fyre Festival Paying Celebrity Influencers for Viral Memes. Last week, I highlighted key FAQs regarding the Federal Trade Commission’s (FTC) Endorsement Guides. It’s a dodgy practice, but it does seem to make sense. What does the FTC mean by a “material connection”? Chopra intends for the FTC to focus on the advertisers, rather than the influencers. Home » Blog » Legal » 2020 Guide To FTC Influencer & Endorsement Guidelines. To learn more about the FTC’s endorsement guidelines, here are some helpful links: Code of Federal Regulations (16 CFR Part 255) FTC Endorsement Guide FAQs So, as the FTC cracks down on material connection disclosures, the good news is these disclosures are rapidly becoming valuable social media assets. Native Advertising: A Guide for Businesses. Guidance. The Consumer Review Fairness Act protects consumers’ ability to share their honest opinions about a business’s products, services, or conduct in any forum – and that includes social media. What kind of social media posts require a material connection disclosure? As calculated by Forbes, companies are on track to spending at least $3 billion on influencer social media marketing in 2019. The FTC guidelines are clear: The buck stops with the advertiser when it comes to the disclosure of endorsements. A hashtag disclosure in the post, caption, or description. What’s central is the content itself: the post, the picture, or the video. On Facebook, Instagram, Twitter, Snapchat, and YouTube, there are a variety of ways to make a material connection disclosure. how well advertisers and endorsers are disclosing unexpected material connections in social media; whether children are capable of understanding disclosures of material connections and how those disclosures might affect children; whether incentives like free or discounted products bias consumer reviews even when a favorable review is not required to receive the incentive, and whether or how those incentives should be disclosed; whether composite ratings that include reviews based on incentives are misleading even when reviewers disclose incentives in the underlying reviews; whether the Guides should address the use of affiliate links by endorsers; and. Specifically, this past month the FTC announced that it was formally seeking public comment on whether to make changes to the Endorsement Guides, with a notice in the Federal Register asking for submissions by April 21, 2020. Why? In 2018 and 2019, Influencer Marketing Hub estimated that somewhere between 25% and 30% of influencers have been instructed by brand promoters not to disclose their material connection to the product. No P204500 In the old days of advertising, the CEO of Proctor & Gamble could joke that he knew for certain that half of all his company’s advertising worked . Using a formula of $100 x 10,000 followers + extras = total rate, you can see how quickly the dollars can roll in for influencers. The FTC requires influencers to disclose their material connection to a brand: After the promotion contract or agreement has been completed. FTC Extends Comment Deadline for Endorsement Guides Review to June 22. 5 Tips for Proper Sponsored Posts. The FTC warns that these branded content tools do not meet the disclosure requirement. By Chazz Mair Feb 18, 2020 Share Share Tweet Email That percentage doubles for consumers under the age of 25. FTC Looking for Public Comment. It’s also gotten the attention of the Federal Trade Commission, the agency responsible for enforcing federal laws on advertising and promotions. The advertiser is responsible for ensuring that any agencies or influencers they work with on social media marketing campaigns know and correctly practice the rules of disclosure. The FTC is asking for input on a wide … For influencers and advertisers to be in voluntary compliance with the law, the FTC Endorsement Guide recommends several important practices, including that: Influencers be bona fide users If you would like to find out more information about the FTC Endorsement Guidelines, we at Pissed Consumer suggest checking out FTC’s answers to the most frequently asked questions about the guidelines. 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