New Fed Rules for All Marketers - Dec 1st

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In your travels around the Internet lately you've probably noticed a few folks talking about the new rules in the U.S. that will affect all of us involved in Internet marketing.

Rather than sticking our heads in the sand, hoping that we won't be personally affected (or caught breaking the law), I thought it might be good to actually look into what the commotion is all about and what it means for me personally.

On December 1, 2009, the Federal Trade Commission (U.S.) will have a new set of guidelines go into effect which governs advertiser testimonials and endorsements. I believe the reason for the new rules is to better protect consumers from unscrupulous peddlers that push all kinds of wild and false claims about the effectiveness and past results of their products (or those that they endorse as an affiliate).

These rules have not been revised (as a whole) since 1980, so it's certainly time to have some new guidelines that cover Internet selling which was not an issue 30 years ago.

One of the big changes that I see is this: many Internet sites have been using a simple disclaimer that states something like "these results are not typical" or something to that affect (as in, "your mileage may vary") which has been acceptable in the past. That will no longer be the case according to the FTC.

From the FTC web site: "... advertisements that feature a consumer and convey his or her experience with a product or service as typical when that is not the case will be required to clearly disclose the results that consumers can generally expect." From a marketing standpoint, how one can know what the expected results will be is an interesting question that is unanswered, at least from what I have seen.

Marketers also must now more fully disclose "material connections," i.e. payments between advertisers and endorsers (as in affiliates and bloggers). If you recommend (endorse) a product or service, whether paid or free, you must disclose your relationship to the advertiser more fully so that the consumer understands you have a stake in what you are recommending.

I am not an attorney so I'm not going to try to tell anyone what this law means for them. For folks outside the U.S., who knows ... ?

But I will give you a couple of links so you can read these guidelines yourself. If you spend a little time reviewing this information (maybe 20 minutes?), I think you will at least get a feel for how these guidelines could affect what you are currently doing online.

Here is the link to the FTC's web page about the new guidelines ...

FTC Publishes Final Guides Governing Endorsements, Testimonials

12 page PDF: "Guides Concerning the Use of Endorsements and Testimonials in Advertising"

One final thought. The FTC web site states:

"In any law enforcement action challenging the allegedly deceptive use of testimonials or endorsements, the Commission would have the burden of proving that the challenged conduct violates the FTC Act."

How is the FTC going to police the Internet? Is it going to be worth their time and effort to go after every affiliate or blogger that violates the guidelines? This will be interesting to follow ...
#1st #dec #fed #marketers #rules
  • Profile picture of the author David Wolfman
    Interesting post, thanks. I wonder when will the rest of the world make their own version of FTC guidelines.

    As for the policing, as always they will do a few exemplary lawsuits with ridiculous penalties imposed and everybody else will start to follow the rules.

    On the other hand, in my opinion, FTC rules work for our advantage and will build more trust from the customers.
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