How the New FTC Regulations Affect Social Media Marketing

MelissaMegginson
Melissa Megginson Marketing Manager, Tailwind

Posted on March 26th 2013

How the New FTC Regulations Affect Social Media Marketing

The new March 2013 FTC regulations were introduced as a way to help consumers feel they can trust online advertising as a source of information. While there were already some regulations put into place by the Dot Com Disclosers Report of 2000, this current report digs deeper into the mobile, online and social media space.

"Clear and Conspicuous Disclosures in Online Ads"

For an online advertisement to be "clear and conspicuous"  in its disclosures, there are a number of guidelines that must be followed.

  • Disclosures must be very close to the claim it's disclosing.
  • When possible, avoid having to scroll to see the disclosure.
  • If using hyperlinks for disclosures they must be obvious, labeled appropriately, go directly to the disclosure upon click-through, repeated in long advertisements and be monitored for effectiveness.
  • In space-constrained ads (like TweetsFacebook posts, or Pins) the disclosure must still be obvious and clearly stated.
  • Disclosure is needed before the decision to buy is made (before someone "adds to cart").
  • Above all else, the claim needing the disclosure must actually be disclosed.

How the New FTC Regulations Affect Social Media

Until now, there was little regulation on disclosure in social media.  Due to the limited space often allotted in posts, many marketers didn't bother with disclaimers in ads on social media networks.  That, however, is no longer a valid excuse according to the FTC.

In-Text Disclosure

  • The FTC gave an example of a tweet by "JuliStarz" promoting a diet pill she claims made her loose 30 pounds in 6 weeks.  Because those aren't typical results and because "JuliStarz" was paid to Tweet that, she is in violation of  the new FTC regulations.
  • For a post to follow the FTC regulation, it must first state that it is an advertisements and be followed up with the disclosure to the claim. Example:

FTC Regulations Used in a Tweet

Hyperlink Disclosure

  • If you choose to link to the disclosure, it must be obviously included next to the claim. For example, JuliStarz cannot say that she lost 30 pounds in 6 weeks then follow it up with a link to the disclaimer but not state what the link leads to.
  • To properly link to a disclosure, make sure the user knows that what they're clicking on is the disclosure link.

How To Use The FTC Regulations On Pinterest

Blogging Disclosure
  • The new FTC regulations also affect how bloggers must disclose posts about products they received for free. Before the current regulations, providing a disclosure or hyperlink to a disclosure at the end of the blog was sufficient. Now the FTC warns that consumers could become distracted in the post before reaching the bottom to find out what they read was provided by the company.
  • For the disclosure to be "clear and conspicuous", the blogger must tell readers at the top of the page that the product was free from the company. 

How To Use The New FTC Regulations on a Blog

 

While adding "Ad:" to the beginning of a post might not be the sexiest way to advertise your product over social media, it helps ensure consumer trust and keeps the FTC happy. And everyone knows, if the FTC isn't happy, no one's happy.

This post originally appeared on the PinLeague Blog as How New FTC Regulations Affect Social Media Marketers

MelissaMegginson

Melissa Megginson

Marketing Manager, Tailwind

Melissa Megginson is Marketing Manager at Tailwind, the leading Pinterest Marketing Tool for Brands. For more information visit tailwindapp.com or email Melissa directly at melissa@tailwind.com.

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Comments

desertconsulting
Posted on March 26th 2013 at 7:48AM

I don't like very much the way Pinleague advertise itself: it's a bit unclear. For example, it suggests to sign-up for a free account and it asks my credit card number to pay a dollar for a one-time fee it didn't mention before. Even a post on new FTC regulations look suspicious ;)

MelissaMegginson
Posted on March 26th 2013 at 3:12PM

Aw, but what to expect was disclosed! And don't worry; if you did sign up for any of PinLeague's free services, you will be refunded your dollar after the memo goes through :)

Posted on March 26th 2013 at 11:31AM

Interesting post... Thanks for sharing.. I had a very good read..

 

 

MelissaMegginson
Posted on March 26th 2013 at 3:10PM

Thanks for your comment, Treb! I do believe the regulations will help consumers trust social media as more of a factual marketing source, but it will take some getting used to. 

mr_pounders
Posted on March 26th 2013 at 4:35PM

Very interesting article Melissa, thank you for posting. My question to you is two-fold. First, how do you anticipate the FTC to monitor the entire social universe or even a good percenatge of it to ensure compliance? Clearly there will be violations that slip through but I think this is going to be a huge undertaking. Secondly, what types of consequences will there be for violators? I am assuming there will be some sort of warning system, but what happens after that?

MelissaMegginson
Posted on March 26th 2013 at 11:53PM

Really great questions, Eric!

From my understanding of the regulations process, it's mainly based on companies being reported for violations. Because of this, I'm sure you're correct in thinking many violations will be overlooked. If a company does not comply they could face anything from a "cease and desist" notice to a potentially hefty fine; it seems to change case-by-case.