US bloggers and publishers of all sizes are now asked to declare all forms of compensation they receive in order to promote products and services on their sites. Not doing to can lead to penalties of up to 11,000 USD, according to new regulations issued earlier by the Federal Trade Commission (FTC).
It is for the first time since 1980 that the FTC modifies regulations with regard to testimonials, endorsements, shopping advices, reviews; it is also for the first time that blogs are to be monitored as well.
Below are excerpts from the new regulations, “FTC Guides Concerning Use of Endorsements and Testimonials in Advertising”:
Definitions
[…] “an endorsement means any advertising message (including verbal statements, demonstrations, or depictions of the name, signature, likeness or other identifying personal characteristics of an individual or the name or seal of an organization) which message consumers are likely to believe reflects the opinions, beliefs, findings, or experience of a party other than the sponsoring advertiser. The party whose opinions, beliefs, findings, or experience the message appears to reflect will be called the endorser and may be an individual, group or institution.”
Consumer Endorsements
“(a) An advertisement employing an endorsement reflecting the experience of an individual or a group of consumers on a central or key attribute of the product or service will be interpreted as representing that the endorser’s experience is representative of what consumers will generally achieve with the advertised product in actual, albeit variable, conditions of use. Therefore, unless the advertiser possesses and relies upon adequate substantiation for this representation, the advertisement should either clearly and conspicuously disclose what the generally expected performance would be in the depicted circumstances or clearly and conspicuously disclose the limited applicability of the endorser’s experience to what consumers may generally expect to achieve. The Commission’s position regarding the acceptance of disclaimers or disclosures is described in the preamble to these Guides published in the Federal Register on January 18, 1980.
(b) Advertisements presenting endorsements by what are represented, directly or by implication, to be “actual consumers” should utilize actual consumers, in both the audio and video or clearly and conspicuously disclose that the persons in such advertisements are not actual consumers of the advertised product.”
Disclosure of material connections
“When there exists a connection between the endorser and the seller of the advertised product which might materially affect the weight or credibility of the endorsement (i.e., the connection is not reasonably expected by the audience) such connection must be fully disclosed. An example of a connection that is ordinarily expected by viewers and need not be disclosed is the payment or promise of payment to an endorser who is an expert or well known personality, as long as the advertiser does not represent that the endorsement was given without compensation. However, when the endorser is neither represented in the advertisement as an expert nor is known to a significant portion of the viewing public, then the advertiser should clearly and conspicuously disclose either the payment or promise of compensation prior to and in exchange for the endorsement or the fact that the endorser knew or had reasons to know or to believe that if the endorsement favors the advertised product some benefit, such as an appearance on TV, would be extended to the endorser.”
The whole guide, as published by the FTC, is available at http://www.ftc.gov/bcp/guides/endorse.htm .
