Transparency in blogging. New FTC rules concerning reviews of products by bloggers.
New rules that go into effect on December 1, 2009 state that “Consumer-generated media” outlets (e.g., bloggers) will now have to disclose if they are being compensated by a manufacturer, advertiser, or service provider when they review an item. So if a blogger gets a laptop from a manufacturer to review and gets to keep it, he or she will have to make that fact public.
From the FTC website:
Under the revised Guides, 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. In contrast to the 1980 version of the Guides – which allowed advertisers to describe unusual results in a testimonial as long as they included a disclaimer such as “results not typical” – the revised Guides no longer contain this safe harbor.
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. Likewise, if a company refers in an advertisement to the findings of a research organization that conducted research sponsored by the company, the advertisement must disclose the connection between the advertiser and the research organization. And a paid endorsement – like any other advertisement – is deceptive if it makes false or misleading claims.
The new guidelines don’t specifically tell bloggers how they need to make the disclosure, but they do lay out the penalties: up to $11,000 per violation with the added possibility of injunctions. The FTC could also order that consumers be reimbursed in cases where a relationship between blogger and advertiser isn’t disclosed and the consumer suffers financial harm because of a review.
For more information see the FTC’s webpage on the decision:
FTC Publishes Final Guides Governing Endorsements, Testimonials