The FTC is currently proposing regulations on blog content, and in fact across all social media sites. Yes - what you say on Facebook could come back to haunt you in the near future.
I first heard about an update that dealt specifically with endorsements, testimonials and product reviews. The issue is with deceptive claims, but also with atypical results. Apparently "results may vary" and "results not typical" will no longer be sufficient disclaimers. They now want us to use typical results only.
In what seems (to me) to be well-planned timing, the FTC recently fined the QVC home shopping network $7.5 million for that very thing. A very public example of what we could see filtering down to the work-at-home mommy blogger.
The question everyone is asking is just how far this will trickle down - and how this will ultimately affect bloggers, online advertisers, affiliate marketers, and even the unsolicited & unendorsed opinions and comments that are posted across discussion forums and social media sites every single day...
The FTC is planning to hold marketers liable for false statements published on blogs and social networks—meaning companies or bloggers could get sued for saying a product was good if it really wasn’t. source
I've read about half a dozen articles on the topic already, and it just keeps raising more and more questions in my mind. Like do they think consumers are stupid? What ever happened to personal responsibility? Perhaps the FTC could regulate common sense, and make sure everyone has an equal amount.
What if I think a product is great, and you don't? Where do you draw the line between opinion and fact? Does an opinion become a fact if you get paid for that opinion? Or is an opinion simply an opinion, whether you are paid for it or not? And if it's a fact that your opinion of the product is that you like it, does that make my opinion wrong if I don't?
I understand that the proposed regulations target paid bloggers, word-of-mouth marketing, product review type sites, etc. The question is not where it will start, but where it will end. And what effect it will have on social media as we know it.
What if you do have atypical results? Wouldn't you want to share that with all of your friends on Twitter or Facebook? And if you do, will you be held liable just for talking about your personal experience? Sure you can prove that you purchased the product and that you are not being compensated for your comments or recommendation - but will it stop people from sharing out of fear of being put through that kind of hassle?
First Google, now the FTC. Google has been "regulating" Affiliate Marketing, Paid Blogging and the sale of Text Link Ads for some time now. See:
- Google PageRank: Tool or Marketing Gimmick?
- No More Text Link Ads & Sponsored Blogging
- Warning: “Thin Affiliate Sites”
Agree with it or not, these things do have their impact. And more often than not they affect legitimate marketers far more than they do spammers, liars or con artists. Think Can-Spam. I dont know about you, but I now have problems with email deliverability between friends... yet don't seem to have any trouble receiving an email ad for Viagra.
The current proposal is not just about false advertising. The FTC is talking about atypical results. Let's say, for the sake of example, that I bought the AffiliateTheme from Unique Blog Designs. I used it, made a million dollars with it, and published the case study here on my blog. My results would be "atypical" for a number of reasons. First because I have over a decade of online marketing experience. Second because 98.3% of the people that bought that same theme never did anything with it (note: I made up that statistic - just to clarify 😛 ).
If I did have that kind of result with my AffiliateTheme, I would want to share it publicly - and I would use my affiliate link for that product in the recommendation, of course. Wouldn't you want me to share my results with you? Would you like to read what I used, the details of how I used it, and the exact results I experienced - so that you could duplicate that same success for yourself?? Of course you would.
But should I be held liable, fined $7.5 million dollars per se, if you don't follow the steps and achieve the exact same results? Or if your circumstances prevent you from achieving the same results?
And what if you were fine with it, having your own common sense and personal responsibility in tact, but the FTC put me "out of business" over it? How would you feel about that?
The FTC would instead require advertisers to display typical results instead of hyping up one spectacular atypical result... The first update to these guidelines since 1980, the new rules would apply to all forms of advertising, including online advertising. source
In the FTC ruling against QVC, they went back to the advertisers and merchants that aired the offending infomercials to chip in on the $7.5 mil. Could this happen to you for testimonials you've submitted to merchants online? It sure does make you think twice about sharing your "atypical results", yes?
To state the obvious: you should always be completely honest in your reviews, and of course never say (or blog) anything that you can't back up or stand behind. My issue with these potential regulations is in the FTC judging whether my opinion is offensive - according to their strict guidelines - or whether my results are typical or not.
How in the world am I supposed to know if my results are typical? If I eat cheerios every day for a month and my cholesterol levels improve, I might tweet that. What if General Mills paid me to tweet that? What if they didn't and "I'm just sharin". Even if it is true, and you received NO free cheerio (not a single one), the FTC may just have their eye on you for it...
I'd love to hear your thoughts. I'll leave you with a few links on the topic for further research as well:
Parenting Blogs May Be Held Liable for Product Reviews
This mommy blogger is scared! An estimated hundreds of thousands of fellow parenting bloggers may be in danger of being sued if the government approves a change in its policy regarding endorsements of products by Web pundits.
The Feds To Push For 'Truth' In Social-Media Marketing
The FTC would face its own challenges in proving that a given blogger or forum member outright lied, or that a brand paid them to do so.... O’Brien argues that the mere threat of legal action could spook advertisers...
FTC To Shut Down Pay For Posts - Will Bloggers Become Criminals?
The next question is what will the FTC do to those bloggers that do write paid reviews? Will they prosecute and turn them into criminals? That is fine if you are based in the US. What if your based in Britain, Europe or Australia - will the law cross borders?
FTC To Clamp Down On Social Media Marketing
The Federal Trade Commission (FTC) is planning to regulate online social marketing. Yes, that includes blogs, Facebook, Twitter, and other forms of social networking.
Federal Regulations and Full Disclosure about Advertising
Perry Marshall says- The gist is: From now on you can't just quote the happiest and most successful testimonials, you have to disclose how "everybody" does and what "average" is.
Bloggers Be Warned: FTC May Monitor What You Say
The FTC is proposing that word-of-mouth marketers and bloggers, as well as people on social-media sites such as Facebook, be held liable for any false statements they make about a product they're promoting, along with the product's marketer.
Best,
Disclaimer: The FTC did not pay me to write this blog post.
p.s. Just rec'd an email from Jerry West this morning (5/31/09) that I am copying here along with a link to his post for affiliate marketers:
There has been a lot of discussion in forums and blog posts about the proposed FTC changes and how it is going to ruin affiliate marketing as we know it.
Is that true?
Has anyone actually read the proposed changes? I don't think so. So I dug them up and posted them on my blog so you could review them and even included my commentary as well.
The bottom line is, if the changes do go through, they will be VERY difficult to enforce, and they are mostly aimed at high level marketers, which doesn't include affiliates. In short, as long as you aren't being sleazy, you don't have anything to worry about and I doubt you will have to state "I am an affiliate and if you do buy this product based on my recommendation I will get a commission" when posting a link on your site or blog.
Read more here ...
http://blog.seorevolution.com/2009/05/30/ftc-change-in-endorsements-and-testimonials-policy/I'll be watching this carefully, but I will tell you this, there is no way I am going to change the wording on 583 domains. 🙂
Best Regards,
Jerry West
Web Marketing Now
About Lynn Terry
Wow. I'm almost speechless. 😉
Common sense today is anything but common. This FTC ruling confirms it.
Hi Lynn!
I see a bunch of "The Death Of Online Advertising" products coming out soon. heh heh
Certainly a timely post! 😉
Earlier, I was reading something similar on Linda Buquet's blog at:
http://affiliate-blogs.5staraffiliateprograms.com/851/affiliate-marketing-ftc-disclosure.html
She also has some updates on the "affiliate tax" laws going around these days too. She has good info to follow.
Warning ... RANT follows ...
BUT ... this is REALLY getting out of hand. Like you mentioned. "where is the personal responsibility?" or even "common sense" these days?
People need to be careful what they wish for as they might actually get their wish and it most likely won't be what they thought it would be like.
Having MORE gov't intervention is gonna make the "lines" even MORE blurry as it all becomes a "judgement call" (and it WON'T be yours) on what's legit and what's not.
Sorry to say but ... The people complaining the most are the ones most likely to go nowhere with their online money-making ambitions. ALOT of sour grapes attitudes are prevalent in the online marketing world these days. People need to pay MORE attention to THEIR activities.
With this kind of crap (gov't coming up with more & more "tough to enforce" regulations & taxes) becoming more prevalent, Dealing with spam is the least of my aggravations online.
Most of what I do online is affiliate related and I'm gonna continue to do the best I can like I've been doing these past years. It's working for me and as long as I'm doing things honestly, I'm not going to worry as much about it.
We've had to adjust before and we'll just have to adjust again as needed. heh heh
Sorry ... RANT NOW OVER! Before I go TOO far! LOL
IF all the IMers were like you, Lynn, this would be a moot point! 😀
Have A GREAT Week ALL!
Rick Wilson aka Corprebel
Great, then what will happen to all the TV commercials? Everyone claims there product is THE BEST. Let's put an end to all of that first.
What about the "Freedom of Speech"? Talking about only genuine speech. I can't agree enough with your point "What if I think a product is great, and you don’t? Where do you draw the line between opinion and fact?"
FTC is after marketers/bloggers/webmasters just like Google. No one is bothered about the 200 viagra emails I get daily and 200,000,000 porn websites that are spread across the internet. What good are those sites doing to the eWorld?
Isn't this enough that a webmaster/blogger pastes the text on top of their website or in the Disclosure Policy, "These are my opinions, not industry standards"?
This whole thing seems like conspiracy, more pain for webmasters & bloggers, as if G wasn't enough for that.
Dev
I'm heartened to hear it's not just my governemnt that feels the need to be useful and regulate anything that happens or doesn't, I too am more concerned about the issue of accountability and personal responsibility in our society.
Perhaps we can have eBay style negative & positive Testimonials?
It's my fault I paid $197 and made $20,000 in 15 days sitting on the
beach.
It's my fault I paid $47.00 a month for the last 4 months.. Um how do you login and where?
Honesty is not neccesarily truth, though it may be fact. Typical results...atypical results... which ever method is chosen it will become a yardstick, much the same as CTR at AdWords and Gravity at Clickbank.
Just for some perspective I still have a few offline friends, they
remain totally oblivious to the often Tinman world of info product marketing, CPA offers, affilate marketing yet I feel sure that if they discovered them they would do the same as they do with a Reader's Digest winning lottery ticket.. trash it and move on.
Cheers, Brendan
PS Lynn I have always found your Blog to be one of the few places I can drop my guard, safe in the knowledge that truth and honesty resides here!
I don't really get what the fuzz is about.
If you get paid or benefit from what you are writing about it should be made 100% clear. Not to do so I consider unethical and fraudulent.
If you do not benefit in "money terms" from what you write you can write what you want on blogs, facebook or whatever. Writing on your personal blog that your company product is awesome and not say its your product and/or company is fraudalent.
Writing a case study about a product is not in and of itself unehtical/illegal. But if you get paid to write it, get money from sales of that product and so on you must tell the consumer that. This is what white papers are all about.
But how the heck will a consumer know that a review is authentic or not? If the reviewer got paid or benefit from the review in money/servies or similar the consumer should be made aware of this. This so he/she can choose to trust or not trust the review.
If you find FTC initiative so troublesome its easy to assume you do unethical and somewhat fraudulent marketing.
Just a little rant.
I disagree. This particular proposal is troubling to everyone in my opinion, and has the potential to greatly affect legitimate marketers and ethical online business owners. And of course social media as a whole - even those who use Facebook or blogs for personal use only could potentially be affected.
I dont have a problem with disclaimers or with disclosure. That said, I'm curious why you feel diclosure, or lack of it, influences your decision to trust a review.
Magazines, TV and such don't have to follow what the FTC now makes clear applies to Internet endeavors?
So US magazine and TV shows can get paid by a company to say nice things and not pay any fines whatsoever if someone finds out?
That just sounds odd.
If people get paid to write nice things I want to know about it, if they get paid at all I want to know about it. If people manufacture the product they rave about I want to know about. If people aren't honest how can you ever trust any online writings. Its all about trust.
The Swedish counterpart to FTC have the same policy as FTC.
In Sweden its been like this for years I have always assumed it was the same way in the US.
Read my post again - the QVC home shopping television network just got fined $7.5 mil. They are updating the regulations which will now also apply online.
I dont have a problem with disclosure as a general rule. I do have concern with the policing of such, and with the policy on "atypical results".
I have read your post earlier. Don't post atypical results only is the conclusion. Balance things out. Give average numbers and so on.
Oh boy...first those scary state "affiliate taxes" putting many out of business overnight, and now the FTC in all its regulatory splendor wants to keep us in line. As THEY define it, of course.
Even if you honestly and clearly state that yes, I've used this product and yes, I've had these results with this product and here's how I actually did it, you can be taken to task because someone disagrees with what you did and/or doesn't do it themselves and blames you.
Sounds like we could find ourselves with lots of dead messengers lying around.
It's "funny" how the U.S. Government can forget something as plain as the First Amendment of The United States Constitution when it is so plainly written. Then, they can turn around and make The Constitution mean something that it never says!
Amendment 1 - Freedom of Religion, Press, Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the Government for a redress of grievances.
This is also a subjective standard. Much like the proposed "Fairness Doctrine." Lynn rightly points out that opinions differ as do ability or work ethic. How will the FTC judge this rightly? They cannot.
Woe unto them that call evil good, and good evil; that put darkness for light, and light for darkness; that put bitter for sweet, and sweet for bitter! Isaiah 5:20
Hi Lynn,
I would like to say that I liked and agree with what you said in your blog post, but I am not sure if it is the "typical" reaction.
Hate to get political here for this is truly not the place but: This is what happens when Govt. gets it's foot in the door. This is the early stages of Socialism and it's only going to get worse.
How about if we apply these same rules to politicians? Every time they embellish or quote some "focus" group or point to ONE person who supports their view/legislation they should be fined $7.5 million and booted out of office?
Just another example of the insidious effects of looking toward government to solve problems. Bureaucrats don't have enough knowledge to micromanage all the risks of the world and as a result they screw things up more than they help.
Thanks for the morning adrenalin rush Lynn! My personal opinion on this is that you "Americans" should learn from the mistakes we dumb Canadians made over the years. We are generally a pack of sheep that will lay down and lick our proverbial "nuts" on command! Excuse the vulgar memtaphor... but really... you really need to pay attention.
I think we have reached the tipping point in technology and the power that be ... the "illuminated ones"... the old boy's network.. has just figured it out. They are trying every trick in the book to stuff you and all the rest of us back in the box! For heaven's sake.. we cannot have the masses thinking for themselves!
The FTC and FDA and others have already lost. To the extent that we tolerate their delusions of grandeur, they will continue to push. Collectively, we are THE FORCE to match all forces.
Hey FTC..... REGULATE THIS .|..
Lynn,
I'm reminded of a line from the TV series Firefly where Mal, the captain of the ship replies to a questioner with the quip: "Isn't that what a government's for...to get in a man's way?"
This is nothing more than Nanny Government trying to make criminals of us all. I for one will not let them close my mouth. It's time we collectively make a stand and tell these stupid morons where they can stick their ridiculous and seriously unjust laws.
The government has stepped waaaaaay over it's boundaries. It's time we started pushing back. I agree with the final sentiment expressed by Nick Walsh above.
I'll be writing about this in my blog, and it won't be polite. 🙂
Couldn't agree more Lynn. Thanks for the thoughtful and informative post.
One of the main reasons our market has been so successful for so many years is the relative freedom we have in America. The more we chip away at that the more everyone will suffer.
I have to wonder what would happen if they applied the same rules to politicians, who are after all paid by the government... can we make them say "results not typical" whenever they open their mouths?
Aherm, Eric, the politicians are paid by US, not the government.
Come to think of it, we pay the government, full stop.
That is really, really scary stuff. It is a shame that our government is trying to regulate everything including small businesses which is what our economy is built on. It is just one new thing after another with our current administration. There are bigger fish to fry right now, and work at home bloggers are not it.
Another great article on the topic showed up on TechCrunch over the weekend: http://www.techcrunch.com/2009/05/24/this-is-not-a-sponsored-post-paid-conversations-credibility-the-ftc/
Hey Lynn, You mentioned Cheerios in your blog, the FDA is already coming after them for saying on their box that they lower your cholesterol. Just more BIG BROTHER coming down the pike. No one is responsible for themselves anymore. We're all "stupid" and need the government to take care of us. The U.S. Constitution means nothing anymore!
I just updated the original post with a note & link from Jerry West on this topic. You can see his blog post at http://blog.seorevolution.com/2009/05/30/ftc-change-in-endorsements-and-testimonials-policy/
Thanx for the link to Jerry's post about this new proposed FTC regs for online advertising/endorsements. I can definitely agree with his assessment of these proposed changes.
(OOPS ... Did I just do an "endorsement" of Jerry West's views from his blog post on YOUR blog? Is that OK?) heh heh
Affiliates are catching ALOT of flack these days (some deservedly so). But I believe MOST aren't doing anything sinister to deserve this kind of crap from the gov't.
I really liked and agree with Jerry's last comment in his post:
"Overall, I don’t see any REAL changes over what should be currently regulated. If people are really falling for these deceptive ads, maybe we should concentrate on the effectiveness of our educational system, or the failing of it. If you are an affiliate marketer, push CPA offers, etc. just keep doing what you are doing. I don’t see any of these changes impacting our business whatsoever."
Personally, while I'm concerned over this issue I'm not that worried yet. Time will tell, though.
Have Fun!
Rick Wilson aka CorpRebel 8)
Disclaimer: The views expressed above are mine and have NOT been sponsored by anyone. Please don't hold it against Lynn for letting me post here. 😉
I am being sued for writing my opinion on a company in a forum and reporting something I confirmed with a confidential source. Litigation is costly:
read my story here http://online.wsj.com/article/SB124287328648142113.html
and follow my case here
http://www.citmedialaw.org/threats/too-much-media-llc-v-hale
with the proposed changes and guidelines by the FTC any person commenting online about a person, product or services should make sure they have legal coverage - even if they are fact checking - they say truth is an absolute defense but defending the truth is very expensive.
Sorry to hear of your situation...I'm going through the samething here in Thailand. I wrote a story (facts as I knew them) and now they are suing me. Even worst here because of the Asian thing of saving 'face'. Telling the truth can be expensive! Hope it works out for you!
As with a lot of things in life, there's positives and negatives with this...
On the one hand there will be a few who, hopefully, will stop being absolute dicks and promoting anything and everything on the market just to make money.
I know this is a problem because I've bought things in the past under recommendation which turned out to be worth less the the paper I printed it on.
On the other hand, there's always a few jobs-worths within goverment and the civil service in general who seem to have a pole up their backside and hate to see anyone making a success of their lives.
And these individuals will go out of their way to make things difficult for the genuine entrepreneurs out there.
Oh, here's an endorsement... Lynn, nice blog 🙂
Thanks Rezbi 😉 lol