FTC Guidelines and Internet Marketing 101
I field a lot of questions about Federal Trade Commission influencer guidelines. The two most common are:
- Are influencers and marketers required to disclose certain information on their websites and social media?
- If so, how do I do it?
The FTC Acai Berry Scandal: A Lesson On Weight Loss False Advertising
Years ago, the FTC came down hard on Acai Berry advertisers and marketers who were using headlines like: “New Diet Pill Helps you Lose 50 pounds in 4 weeks.” This promising diddy also caught the FTC’s eye:
WARNING! AcaiPure Is Fast Weight Loss That Works. It Was Not Created For Those People Who Only Want To Lose A Few Measly Pounds. AcaiPure was created to help you achieve the incredible body you have always wanted …USE WITH CAUTION! Major weight loss in short periods of time may occur.
FTC Punished Marketers for Making Unsubstantiated Weight Loss Claims
These headlines and blurbs caught the FTC’s attention because they made bold claims without substantiating it.
And when asked for supporting evidence, they couldn’t produce substantial evidence. The commission deemed the headlines “false advertising” and levied a hulk-sized fine.
FTC Punished Marketers for “Re-Billing”
False advertising wasn’t the only issue. The FTC was also concerned about “re-bills.”
In the Acai crackdown, the commission reasoned that not only did the advertisement lead customers to believe they would experience dramatic weight loss, but the advertisement also indicated that there was no financial risk.
Yet, buyers were billed for the product without their knowledge – sometimes thousands of dollars!
Over the years, the FTC has continued to clamp down on false advertising claims. No matter the administration, the agency remains consistent: unfair and deceptive marketing isn’t tolerated. So, watch your back and make sure to use the proper disclosures.
And these days, the commission is focused on influencers.
FTC Influencer Guidelines
The FTC isn’t only concerned with false advertising (blatant or otherwise). It also cracks down on influencers who fail to disclose material relationships with brands they’re promoting.
Influencers and affiliate marketers who receive payments from brands engaged in false advertising should exercise caution. According to the FTC, they must post disclaimers or make disclosures regarding “sponsored communications.”
Unfortunately, the FTC didn’t publish a a one-size-fits-all “sponsored communication” disclaimer. However, the FTC provides a few guidelines for influencers and marketers:
- You must disclose “material connections.”
- Connections are material if the reviewer received some consideration for the review (e.g., cash, merchandise, etc.).
- Guidelines impose liability on: (1) advertisers, (2) advertising agencies, and (3) endorsers (including celebrity endorsers).
- The “results may vary” safe harbor is gone – advertisers are responsible for the claims made by endorsers.
Must I Have a Disclosure or Disclaimer on Every Post and Video?
If you’re a paid influencer, affiliate marketer, or any entity receiving pay for advertising, you must use disclaimers.
“What kind of disclaimers do influencers need to use?”
It’s different strokes for different scenerios. To play it safe, “clearly and conspicuously” place disclaimers and make verbal disclosures as prescribed by the FTC guidelines. A link in small type — which is the same color as the background — won’t do, though.
Use Lots of Disclaimers and Disclosures Everywhere
Put disclaimers on every promotional post. Why? Because if it’s only in one spot, there’s no guarantee readers will see it.
The FTC Guidelines govern advertising on social media platforms too. So disclose material connections on every tweet, snap, gram, or update.
How you can comply with FTC Guidelines
The revised FTC Guidelines forbid misleading and false advertising.
Influencers must disclose when advertisements showcase atypical results. Furthermore, marketers must always disclose any material relationships between themselves and advertisers .
If you violate the guidelines, the agency will consider the “totality of the circumstances.” Meaning they’ll look at:
- The advertised product
- The advertisement claims
- Whether or not a “reasonable consumer” would be able to determine (from the disclaimer) if there is a material connection between the advertiser and the marketer
Be careful out there influencers and affiliate marketers. The truth can hurt…but it’s not as painful as the FTC crashing down on you.
Contact an Influencer Law Attorney
Are you an influencer who needs a bit of legal help? For over a decade, I’ve worked with online marketers and influencers. Whether you’re issue involves FTC compliance, copyright issues, general business matters, or even reputation hiccups, I can develop a strategy that works best for you. Get in touch today. Let’s overcome your challenge.
