The FTCs new guidelines on endorsements is sure to effect online advertising.
Remember our post last month on the pros and cons of paid Tweets and blog entries? The FTC just added a huge tally mark to the ‘cons’ section.
Presented Oct. 5, the Federal Trade Commission stood by their promise of reviewing their two-decade-old guidelines overlooking the use of testimonials and endorsements in advertising by introducing a new set of rules.
The new policies dictate, among other things, that bloggers who are paid to post must present to their readers that they were compensated, as it is considered a paid endorsement.
Via the FTC announcement :
“The revised Guides also add new examples to illustrate the long standing principle that “material connections” (sometimes payments or free products) between advertisers and endorsers – connections that consumers would not expect – must be disclosed. These examples address what constitutes an endorsement when the message is conveyed by bloggers or other “word-of-mouth” marketers.”
Another kicker is the FTC’s new policy on the fine print, making it more difficult for ads that are notorious for presenting unusually positive results as the status quo:
“In contrast to the 1980 version of the guides—which allowed advertisers to describe unusual results in a testimonial as long as they included a disclaimer such as ‘Results not typical’—the revised guides no longer contain this safe harbor.”
To drive the point home that the FTC is cracking down on ad fraud, they’ve also included brand new clauses about celebrity endorsements.
While the new rules obviously affect everybody in the advertising world, they will no doubt hit online advertising the hardest, as less-than-truthful ads seem to be as prevalent as ever.
Penalty for violating the new rules includes an $11,000 fine, along with other lesser charges.
Read the full set of the FTC advertising rules here.
*image obtained from stock.xchg.
—Melinda is an intern with Wicked PR in Atlanta. She recently graduated from The University of Tennessee with a degree in journalism and electronic media. Follow her on Twitter @WickedMel7.
