Here comes the FTC to the peoples rescue… again. In order to better protect consumers, the FTC has updated its 30-year old never since updated “Guides Concerning the Use of Endorsements and Testimonials in Advertising“.
What they are now requiring is a clear statement letting website visitors know they were paid to post, or get some sort of payout for transactions made from their blog. The FTC update can be read here.
?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.?
Other “word-of-mouth” marketers include affiliates and our flogging/farticle ways. Unfortunately, the FTC doesn’t make it clear how this must be stated on websites. So for now, I’d have to guess a * and <small> text in the footer amongst the other disclaimers would be enough.
Those that don’t comply may face charges up to $11,000. This is just a drop of water in the bucket for most affiliates making money with fake testimonials, but this rule could end up lowering conversions significantly if the FTC required truly clear statements (say in the header, next to all claims with a *, in a pop-up).
Who’s scared and who could care less?