April/May 2010 / Cover Story
FTC Endorsement Guides Extend to Bloggers
The Federal Trade Commission has revised its guidelines regarding advertising endorsements and testimonials, extending them to social media such as blog and twitter posts. Failing to adhere to the guidelines could result in FTC or state attorney general administrative enforcement actions against both advertisers and bloggers.
The fundamental issue, according to the FTC, is whether the relationship between the speaker and the advertiser is one of sponsorship. Compensation or the provision of free products are among the factors to be considered. A statement might be “sponsored” even if the advertiser does not suggest it or control its wording.
The guidelines emphasize transparency. Any connection between the endorser and the advertiser that might materially affect the weight or credibility of the endorsement must be disclosed. This requirement would extend to cases where celebrities pitch products on talk shows or social networking sites, to programs that award points when “team members” talk to friends about a product, and to employees who post positive message about their employer’s products on message boards. Funding relationships with research organizations also must be disclosed.
Advertisers, endorsers or both can be liable under various scenarios. Advertisers have an obligation to provide guidance to both employees and endorsers. Well thought-out polices and training will help avoid enforcement actions and liability.
