Appendix

Federal Trade Commission Guidelines

Before you embark on a full influencer marketing campaign, be sure to review and familiarize yourself with the latest Federal Trade Commission (FTC) guidelines for proper disclosure of paid influencer relationships. Here are the documents you should be familiar with:

Warning In this appendix, you’ll find excerpts from both of these FTC guides. Review them carefully. When in doubt, always err on the side of disclosing to avoid any chance of public shaming by the FTC and potentially hefty fines for failing to follow proper disclosure protocols.

To make sure you’re always accessing the most current FTC guidelines, go to https://www.ftc.gov/tips-advice/business-center/advertising-and-marketing.

Blogs, Twitter, Instagram, Facebook, or Pinterest

The FTC states that the disclosure must be written in a clear and conspicuous manner that can be understood by the average reader. The disclosure must also be placed directly next to, or as close as possible to, the sponsored content.

In a blog post, this requirement can be satisfied with a simple disclosure statement at the top of each sponsored blog post. On a lengthy blog post, you should repeat the disclosures, as needed (for example, it may be reiterated at the end of the post).

In a social post on Twitter, Instagram, Facebook, or Pinterest, you may use a hashtag such as #sponsored or #ad to indicate the paid relationship. If multiple hashtags are being used, be sure that the disclosure hashtag is within the first three mentions following the endorsement.

Here’s what the .com Disclosures document says:

  • 3. Required disclosures must be clear and conspicuous. In evaluating whether a disclosure is likely to be clear and conspicuous, advertisers should consider its placement in the ad and its proximity to the relevant claim. The closer the disclosure is to the claim to which it relates, the better. Additional considerations include: the prominence of the disclosure; whether it is unavoidable; whether other parts of the ad distract attention from the disclosure; whether the disclosure needs to be repeated at different places on a website; whether disclosures in audio messages are presented in an adequate volume and cadence; whether visual disclosures appear for a sufficient duration; and whether the language of the disclosure is understandable to the intended audience.
  • 4. To make a disclosure clear and conspicuous, advertisers should:
    • Place the disclosure as close as possible to the triggering claim.
    • Take account of the various devices and platforms consumers may use to view advertising and any corresponding disclosure. If an ad is viewable on a particular device or platform, any necessary disclosures should be sufficient to prevent the ad from being misleading when viewed on that device or platform.
    • When a space-constrained ad requires a disclosure, incorporate the disclosure into the ad whenever possible. However, when it is not possible to make a disclosure in a space-constrained ad, it may, under some circumstances, be acceptable to make the disclosure clearly and conspicuously on the page to which the ad links.
    • When using a hyperlink to lead to a disclosure,
    • make the link obvious;
    • label the hyperlink appropriately to convey the importance, nature, and relevance of the information it leads to;
    • use hyperlink styles consistently, so consumers know when a link is available;
    • place the hyperlink as close as possible to the relevant information it qualifies and make it noticeable;
    • take consumers directly to the disclosure on the click-through page;
    • assess the effectiveness of the hyperlink by monitoring click-through rates and other information about consumer use and make changes accordingly.

If you have a lengthy disclosure (for example, one that corresponds to contest or sweepstakes rules) that cannot fit within the status update itself, you may use a hyperlink to drive consumers directly to the disclosure text. Consumers should not have to search for it, and the text should be easy to understand (in layman’s terms versus legalese).

Here’s what the .com Disclosures document has to say on this subject:

  • 6. Understandable Language
  • For disclosures to be effective, consumers must be able to understand them. Advertisers should use clear language and syntax and avoid legalese or technical jargon. Disclosures should be as simple and straightforward as possible. Icons and abbreviations are not adequate to prevent a claim from being misleading if a significant minority of consumers do not understand their meaning. Incorporating extraneous material into the disclosure also may diminish communication of the message to consumers.

Contests and Sweepstakes

When sponsoring a contest or sweepstake, you must ensure that even the consumers entering the contest know that they should use a hashtag such as #contest or #sweepstakes when promoting their entry on social media.

Here’s what the What People Are Asking document says:

[Q:] My company runs contests and sweepstakes in social media. To enter, participants have to send a Tweet or make a pin with the hashtag, #XYZ_Rocks. (“XYZ” is the name of my product.) Isn’t that enough to notify readers that the posts were incentivized?

[A:] No. It’s likely that many readers would not understand such a hashtag to mean that those posts were made as part of a contest or that the people doing the posting had received something of value (in this case, a chance to win the contest prize). Making the word “contest” or “sweepstakes” part of the hashtag should be enough. However, the word “sweeps” probably isn’t, because it is likely that many people would not understand what that means.

Videos

Video reviews and tutorials are an extremely popular avenue for influencer marketing content. If you provide your product free of charge to an influencer for review or you compensated the influencer for the video that she produces, the influencer is required to state the exact nature of the relationship at the beginning of the video. For example, it’s acceptable to say, “This video was sponsored by X” or “I received product courtesy of X.” An upfront disclosure informs viewers at the start that they’re viewing sponsored content. We also recommend that the influencer include a straightforward disclosure in the text of the video description as well, to err on the side of caution.

Here’s what the What People Are Asking document says:

[Q:] My company, XYZ, operates one of the most popular multi-channel networks on YouTube. We just entered into a contract with a videogame marketer to pay some of our network members to produce and upload video reviews of the marketer’s games. We’re going to have these reviewers announce at the beginning of each video (before the action starts) that it’s “sponsored by XYZ” and also have a prominent simultaneous disclosure on the screen saying the same thing. Is that good enough?

[A:] Many consumers could think that XYZ is a neutral third party and won’t realize from your disclosures that the review was really sponsored (and paid for) by the videogame marketer, which has a strong interest in positive reviews. If the disclosure said, “Sponsored by [name of the game company],” that would be good enough.

Online Reviews

Online reviews (even if they’re unpaid) must disclose the reviewer’s relationship to your business if you offer a service or item of value or discount in exchange for writing the review. The review must reflect the writer’s authentic experience of the product or service and disclose any benefits received.

Here’s what the What People Are Asking document says:

[Q:] I’m starting a new Internet business. I don’t have any money for advertising, so I need publicity. Can I tell people that if they say good things about my business in online reviews, I’ll give them a discount on items they buy through my website?

[A:] It’s not a good idea. Endorsements must reflect the honest opinions or experiences of the endorser, and your plan could cause people to make up positive reviews even if they’ve never done business with you. However, it’s okay to invite people to post reviews of your business after they’ve actually used your products or services. If you’re offering them something of value in return for these reviews, tell them in advance that they should disclose what they received from you. You should also inform potential reviewers that the discount will be conditioned upon their making the disclosure. That way, other consumers can decide how much stock to put in those reviews.

Marketing Agencies and Public Relations Firms

If you’re contracting an outside social media/digital marketing agency or PR firm to assist you in your influencer marketing efforts, be sure to do your due diligence to ensure that they have best practices in place to manage their network of influencers, guaranteeing proper disclosure. Any agency worth its salt will have robust monitoring programs to ensure both brand safety and adherence to FTC requirements.

In addition, we recommend looping in your legal team to ensure that they’re also up to speed on the FTC guidelines. That way, all departments from PR and marketing to legal are aligned on influencer marketing messaging and publicity.

Here’s what the What People Are Asking document says on this subject:

[Q:] Our company uses a network of bloggers and other social media influencers to promote our products. We understand we’re responsible for monitoring our network. What kind of monitoring program do we need? Will we be liable if someone in our network says something false about our product or fails to make a disclosure?

[A:] Advertisers need to have reasonable programs in place to train and monitor members of their network. The scope of the program depends on the risk that deceptive practices by network participants could cause consumer harm — either physical injury or financial loss. For example, a network devoted to the sale of health products may require more supervision than a network promoting, say, a new fashion line. Here are some elements every program should include:

  1. Given an advertiser’s responsibility for substantiating objective product claims, explain to members of your network what they can (and can’t) say about the products — for example, a list of the health claims they can make for your products;
  2. Instruct members of the network on their responsibilities for disclosing their connections to you;
  3. Periodically search for what your people are saying; and
  4. Follow up if you find questionable practices.

It’s unrealistic to expect you to be aware of every single statement made by a member of your network. But it’s up to you to make a reasonable effort to know what participants in your network are saying. That said, it’s unlikely that the activity of a rogue blogger would be the basis of a law enforcement action if your company has a reasonable training and monitoring program in place.

At the end of the day, remember that the FTC guidelines are in place simply to protect consumers from false and misleading claims or unintentional bias that may be introduced in a paid influencer relationship.

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