U.S. bloggers must now disclose if they have been paid to review a product or service, or be fined by the Federal Trade Commission.
On October 5th, the regulatory agency announced that for the first time since 1980, it has updated its Guides Concerning the Use of Endorsements and Testimonials in Advertising.
The FTC’s press release states:
The revised Guides also add new examples to illustrate the long standing principle that “material connections” (sometimes payments or free products) between advertisers and endorsers – connections that consumers would not expect – must be disclosed. These examples address what constitutes an endorsement when the message is conveyed by bloggers or other “word-of-mouth” marketers. The revised Guides specify that while decisions will be reached on a case-by-case basis, the post of a blogger who receives cash or in-kind payment to review a product is considered an endorsement. Thus, bloggers who make an endorsement must disclose the material connections they share with the seller of the product or service.
A blogger who violates the rules could reportedly face up to $11,000 in fines. However, the FTC is not 100% clear on what constitutes “material connections.” Payments or free products are obvious, but what about less direct benefits, such as affiliate links where you would receive payment if a visitor happens to follow your link and purchase something from the merchant? Or would promoting a website your own using another websites that you own fall under these guidelines?
It’s doubtful that most bloggers/website owners have much, if anything to worry about. This seems to be directed more at reducing the açaí, teeth whitening, work from home, and other scams that have been popping up everywhere lately, but given the current economic climate, it’s certainly plausible that the government will use any opportunity they can find to fill their coffers. Ironically, you don’t see this type of disclosure being required on network television, which engages in more questionable practices and has far more reach than any single blog.
To play on the safe side of the fence, you should add a disclosure page that is easily accessible to your website and indicate that you may be compensated in some manner for anything that you review or endorse.
