UK’s Competition and Markets Authority Join FTC to Police Influencers

The Federal Trade Commission aggressively polices online influencer activity and disclosure of material connections. In fact, ininfluencer image 2017, FTC attorneys forward more than 90 warning letters to influencers reminding them about the need for clear and conspicuous disclosures.

Overseas, digital marketing authorities are following suit. In 2018, the Competition and Markets Authority, the UK’s primary authority for competition and consumer law, announced an investigation into social media influencers. The CMA subsequently

The use of endorsements, including in social media, are sure to attract CMA and FTC CID attorneys’ attention.

A few – not all – “heads up” points for influencers:

  • Clearly and conspicuously disclose material relationship with brands
  • Do not assume that using a platform’s disclosure tool is sufficient
  • Placement of disclosures is as important as what they say
  • Avoid ambiguous disclosures like #thanks, #collab, #sp, #spon, or #ambassador
  • When disclosing a material connection to a brand, use language that is clear and unmistakable
  • Do not rely on a disclosure placed after a CLICK MORE link or in another easy-to-miss location
  • Consider your own viewing habits on social media
  • On image-only platforms, superimpose disclosures over the picture in a clear font that contrasts sharply with the background
  • Do not be misleading
  • Be transparent.

Even if you do not have a current relationship with a brand, if there was a past relationship (or you received product loans, gifts and/or other incentives) consumers should be properly informed.

Regardless of whether you are a marketer in the U.S. or the UK, disclosures must be prominent, clear, conspicuous and easy to understand.

FTC attorneys state that if you mention a product you paid for yourself, there is not an issue. Nor is it an issue if you get the product for free because a store is giving out free samples to its customers.

FTC CID attorneys are concerned about endorsements that are made on behalf of a sponsoring advertiser. For example, an endorsement would be covered by the FTC Act if an advertiser – or someone working for an advertiser – pays you or gives you something of value to mention a product. If you receive free products or other perks with the expectation that you will promote or discuss the advertiser’s products in your blog, you are covered.

The question you need to ask is whether knowing about that gift or incentive would affect the weight or credibility your readers give to your recommendation. If it could, then it should be disclosed.

There is no special wording to use to make disclosures. The point is to give readers the essential information.

What matters is effective communication.

To make a disclosure “clear and conspicuous,” digital advertisers should use plain and unambiguous language and make the disclosure stand out. Consumers should be able to notice the disclosure easily. They should not have to look for it.

In general, disclosures should be close to the claims to which they relate, in a font that is easy to read, in a shade that stands out against the background, for video ads – on the screen long enough to be noticed/ read/understood, and for audio disclosures – read at a cadence that is easy for consumers to follow and in words consumers will understand.

A disclosure that is made in both audio and video is more likely to be noticed by consumers. Disclosures should not be hidden or buried in footnotes, in blocks of text people are not likely to read, or in hyperlinks.

If disclosures are hard to find, tough to understand or buried in unrelated details, or if other elements in the ad or message obscure or distract from the disclosures, they do not meet the “clear and conspicuous” standard.

With respect to online disclosures, FTC staff has issued a guidance document, “.com Disclosures: How to Make Effective Disclosures in Digital Advertising,” which is available on ftc.gov.

Besides disclosing relationships with the company whose product you are endorsing, ensure that an endorsement represents the accurate experience and opinion of the endorser. You cannot talk about your experience with a product if you have not tried it. If you were paid to try a product and you thought it was terrible, you cannot say it is great.

Also, you cannot make claims about a product that would require proof the advertiser does not have.

Contact FTC Federal Trade Commission (FTC) defense attorneys if you are the subject of an FTC investigation or enforcement action.

Richard B. Newman is a digital advertising and compliance lawyer at Hinch Newman LLP. Follow FTC investigation and defense lawyer on Twitter.

Attorney Advertising. Informational purposes only. Not legal advice.

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