New FTC Rule Regarding Social Media Writing
By Stephen Bucaro
Advertisers have found that having a blogger write about their product
or service is a much more effective way to advertise than posting ads.
Bloggers have found this to be a lucrative opportunity to get paid
for writing. For example izea,
a company that connects bloggers with marketing companies has set up
service for twitter. How much a tweeter gets paid depends upon their
number of followers, but on average companies are paying $29 per
sponsored tweet.
But the Federal Trade Commission (FTC) considers this type of social
media writing to be deceptive advertising. The Federal Trade Commission
has announced that starting December 1, 2009 all people who write web
content (web sites, blogs, facebook, twitter, etc.) must disclose any
compensation they received (product, service, money, or any other form
of compensation).
If you receive a free product or service from a company and you write
a review of that product or service, you must disclose that your review
is a paid endorsement. In the past, content that featured a consumer
conveying their experience with a product or service was required to
include the disclaimer "results not typical".
After December 1, 2009 such content must include the disclosure "this
is a paid endorsement" or "this endorsement paid for by ___________".
Failure to include this disclosure could result in fines of up to
$11,000 per violation. You are not required to disclose the exact amount
of the compensation.
If you purchase a product with your own money and write a review for
which you do not get paid, no disclosure is necessary. What about a
description of a product or service for which you are an affiliate?
You don't actually get paid up front for writing a review or description
of an affiliate product or service. You don't get paid until after
a sign-up or purchase. However, I would still include a disclosure
like "I am a ___________ affiliate".
Will these disclosures render all social media endorsements and
testimonials useless? Well, including "this is a paid endorsement" at
the end of an article kind of does cause the article to lose its
credibility, unless you follow that disclosure with the statement
"I affirm my review to be honest and accurate.", which kind of
"disclaims" the disclaimer and returns credibility to the endorsement.
However that's kind of difficult to do this in a 140 character tweet.
Click here
FTC 16 CFR Part 255 "Guides Concerning the Use of Endorsements and Testimonials in Advertising"
for complete information about the New FTC Rule.
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