Recently, the FTC released updated guidelines for disclosure in advertising. This 2013 update, titled “.com Disclosures,” supplements their 2009 Testimonials & Endorsement Report, which was one of the first explanations of the requirements for disclosure of endorsements, sponsorships and other payments from online endorsers, including bloggers.
The primary reason for the disclosure requirement is to assist readers and viewers in determining whether a blogger or endorser has a material connection to the brand about which they’ve produced content. It seems pretty obvious (to me, at least) why this is important to know.
The notion of disclosure in product promotion is certainly not new and not without controversy; you may not realize that the radio payola scandals continued from the 1950s through the early 2000s. The FTC has been scrutinizing, and fining, brands that do not police their endorsers for decades, and the latest guidelines are meant to bring endorsers, and the brands that hire them, up-to-speed for the social media era.
What’s New in Disclosure-land?
The most relevant part of the update for those of us working in social media is the idea that endorsements and disclosures must be made in all media, including short-form media such as Twitter. As Twitter has risen in popularity there’s been some question about how and how much disclosure was required when tweeting about sponsored posts or other types of paid content, and these guidelines make it clear – Twitter is not exempt.
But this is not a Twitter-only update; there’s much more to the new guidelines. They provide in-depth explanation on the FTC’s “Clear and Conspicuous Requirement” – and although this in and of itself is not new, as media has changed so much, there are new ways that endorsers need to protect themselves and their brands to provide clear and conspicuous disclosures.
Of particular relevance to us, the new guidelines explain the FTCs opinion on:
- Proximity: Even in a space-constrained ad or promotion, the disclosure must be physically closely related to the statement or endorsement. An endorsement in one tweet followed by disclosure in the second tweet is not enough.
- Prominence: Disclosures must be prominent, viewable on any device, and not buried within a web page. Fine print may not cut it, and prominence is even required on a mobile web page.
- Multimedia: Disclosure is required even for audio or video claims and endorsements, with in the same clear and conspicuous way as expected for written media (with proximity and prominence).
Importantly, the FTC has also made it clear that all disclosures must be in “Understandable Language” – which means that using a hashtag #spon or #spons may not be readily understandable to all viewers. The FTC suggests using “#Ad” “Ad:” or “Sponsored” in tweets to be ultra-clear that a tweet or link within a tweet includes compensated content.
Christopher Penn provides some very good Twitter-specific examples of appropriate disclosure on the Shift Communications blog.
What Do the New Disclosure Requirements Mean for Brands?
The FTC has always maintained that the burden is on brands to ensure that their endorsers (in this discussion, primarily bloggers and other online influencers) are in compliance with their guidelines for disclosure.
For years, savvy PR and digital firms have been suggesting language to influencers to include with their brand-sponsored or influenced content. The updated guidelines provide even more specifics for brands to share with influencers, including the “#Ad” or “Ad:” and “Sponsored” suggestions as well as how to disclose in multimedia. The guidelines also provide a number of very helpful examples, which brands can adapt for their own use when working with digital endorsers.
I would hope that the revised guidelines spur brands and their agencies to take a good look at their policies and processes with regards to influencer endorsements. Now is the time to revisit how your firm reviews and polices endorsers; if the FTC is going to make an example of anyone, it’s more likely to be the brand than the endorser. Monitoring for brand mentions is not the same as monitoring for disclosure, so be sure you know what you’re looking for.
The FTC, in one of their blog posts, gave us a handy mnemonic to help us remember what we need to do here. It’s M.M.M.:
- Mandate a disclosure policy that complies with the law;
- Make sure people who work for you or with you know what the rules are; and
- Monitor what they’re doing on your behalf.
And beyond influencer outreach, brands are also beholden to the endorsement guidelines for their websites, advertisements, and celebrity endorsements. Given how broad-reaching these requirements are, brands should probably review the guidelines with their legal counsel.
What Do the New Disclosure Requirements Mean for Bloggers?
Many bloggers have been providing very solid disclosures for years, especially on their blogs, but as I said above, there has been some question of what’s required in short-form media such as Twitter.
Starting now, bloggers should be labeling all tweets, Facebook updates, and sponsored Pinterest pins or Instagram photos, as well as videos and Vines, with the appropriate clear-language disclosure designation: at the minimum, Ad or Sponsored.
There’s no question that these requirements will change the nature of what influencers will tweet and post in short form and possibly long form as well, and quite frankly, I think that’s fine. In my opinion, there’s too much low-quality, unengaging branded content out there anyway, so if fear of these requirements causes a few bloggers and tweeters to drop away, all I can say is yay.
How to Do Disclosures
As I said, the FTC’s Guidelines document provides a number of examples on how to meet the new disclosures requirement, but it does leave many questions unanswered.
So let’s look at a few posts that define when disclosure is required. The “when” hasn’t really changed since the FTC’s original 2009 document – the new doc mainly updates the “how.”
- Dianne Jacob from Will Write for Food explains what kinds of financial arrangements require a disclosure. This is a great breakdown which will be useful to brands and bloggers alike.
- Jeff Hurt writes on the Engage365 blog about what speakers and conference bloggers (those who liveblog or cover live event content) must disclose.
- New Media Expo has a very comprehensive guide to the FTC guidelines, written while the new guidelines were in public review.
- Nyerr Parham, at my client Appinions, an influence marketing platform, writes about the new regulations and what brand influencers must disclose. [Author note: Did you see that? Disclosure within the sentence!]
Tools to Help With Disclosures
To my knowledge, only one company has stepped up to fill what seems to me a glaring hole in helping brands (and also endorsers) create and manage more effective disclosures. That company is CMP.LY; they’ve just relaunched their service with a very cool set of new features and functionality, some of which directly facilitate the Understandable Language requirement.
To see how CMP.LY works, check out my friend Steve Garfield’s recent Vine about a Cadillac ATS he was given to drive.
Note that Steve was not compensated for the test drive, nor was he expected to write about the car – so he did not include an “Ad” or “Sponsored” in his Vine/Tweet – but he did feel compelled to disclose the relationship, hence the use of “disclosur.es.” CMP.LY also has a number of other Plain Language URLs, including “ter.ms,” “leg.al,” “paid-po.st” and “affiliate-po.st” – all of which could be extremely helpful to both brands and bloggers.
CMP.LY is free to individuals – anyone can sign up and use their plain language URLs and disclosure links. Their services for brands and agencies are quite comprehensive; beyond influencer/endorser disclosure tools, they also offer legal review and compliance software for social media. Current CMP.LY clients include Jamba Juice, Nissan and Hain Celestial.
Regardless of how you implement it, now’s the time for all brands and bloggers to get a firm grasp on the FTC regulations. The implementation of these standards will be beneficial to all, and especially readers.
DISCLOSURE: I have no material relationship to any brand or person mentioned in this post except for Appinions, which is a client.
DISCLAIMER: I am not an attorney, nor do I play one on TV. The information provided herin is not legal advice and is only based on my own experiences as a marketer. None of the above should be considered a substitute for you consulting your own legal counsel who will guide you and your company (or blog) in how to manage disclosures and endorsements.
Image source: Flickr.com (jeffanddayna)
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