Online Advertising Compliance and Effective Disclosures

The FTC’s Dot Com Disclosures emphasize that consumer protection laws apply equally to marketers across all mediums, whether delivered on a desktop computer, a mobile device, or more traditional media such as television, radio, or print.

General rule: If a disclosure is needed to prevent an online ad claim from being deceptive or unfair, it must be clear and conspicuous on all devices and platforms that consumers may use to view the ad.

If an advertisement without a disclosure would be deceptive or unfair, or would otherwise violate a Federal Trade Commission rule, and the disclosure cannot be made clearly and conspicuously on a device or platform, then that device or platform should not be used.

To help ensure clear and conspicuous disclosures, the FTC recommends that advertisers consider the disclosure’s placement and proximity to the relevant ad claim, its prominence, whether audio disclosures are loud enough to be heard, and whether visual disclosures appear for long enough to be noticed.

Disclosures should be as close as possible to the relevant claim.

Dot Com Disclosures guidance calls on advertisers to avoid using hyperlinks for disclosures that involve product cost or certain health and safety issues. Hyperlinks should be labeled as specifically as possible. Marketers should consider how hyperlinks will function on various programs and devices.

Space-constrained ads, such as on some social media platforms, must provide disclosures necessary to prevent an ad from being deceptive. Marketers should avoid conveying such disclosures through pop-ups, because they are often blocked.
Other considerations include, without limitation:

  • The overall net impression of the advertisement;
  • Evaluating the size, color, and graphics of the disclosure in relation to other parts of the website;
  • The proximity of the disclosure to the claim;
  • Displaying disclosures prior to purchase or obligation;
  • Incorporating integral parts of a claim prominently and immediately next to the claim without referring the consumer elsewhere;
  • Using unambiguous text or visual cues to encourage consumers to scroll;
  • Avoiding formats that discourage scrolling;
  • If scrolling is necessary to view a disclosure, consumers should not be able to proceed further with a transaction without scrolling through the disclosure;
  • Using hyperlinked disclosures sparingly; and
  • Clearly conveying the importance and nature of the information to which hyperlinked disclosures lead.

When practical, incorporate relevant limitations and qualifying information into the underlying claim, rather than having a separate disclosure qualifying the claim. Consult with an FTC and state AG defense attorney with practical experience implementing relevant disclosure guidance.

Richard B. Newman is an Internet marketing compliance and regulatory defense attorney at Hinch Newman LLP focusing on advertising and digital media matters. His practice includes conducting legal compliance reviews of advertising campaigns, representing clients in investigations and enforcement actions brought by the Federal Trade Commission and state attorneys general, commercial litigation, advising clients on eCommerce guidelines and promotional marketing programs, and negotiating and drafting legal agreements.

HINCH NEWMAN LLP. ADVERTISING MATERIAL. These materials are provided for informational purposes only and are not to be considered legal advice, nor do they create a lawyer-client relationship. No person should act or rely on any information in this article without seeking the advice of an attorney. Information on previous case results does not guarantee a similar future result.

P.S. The above information is a guest post and a very important one. I just wanted to add that when it comes to disclosure… CYA (Cover Your Ass). In other words, whenever in doubt – DISCLOSE. Don’t expose yourself to trouble with any alphabet agencies like the FTC because if you’re doing it wrong they WILL crush you.