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Social Media Disclosure Best Practices in Protecting Consumers and Marketers March 1, 2010

Today’s Presenters Moderator: Paul M. Rand WOMMA President CEO, Zócalo Group Panelists: Gary Spangler WOMMA Board Member eMarketing Manager, DuPont Anthony DiResta WOMMA General Counsel Partner, Manatt, Phelps & Phillips LLP Patrick Thoburn Co-Chair, WOMMA Member Ethics Advisory Panel Co-Founder, Matchstick

Today’s Discussion
Introduce the FTC’s Guide to Endorsements & Testimonials
Explain the role and interplay of WOMMA
Explore the new role of marketers & bloggers
Understand the Guide and best practices
Share resources and how to get involved
Answer questions or concerns

The FTC’s Guide in Review Key Concepts
In 2007, the FTC began the process of reviewing its “Guides Concerning the Use of Endorsements and Testimonials in Advertising” – Not revised since 1980, when they were issued
FTC recognizes the role of self-regulation on “new” social media platforms, but notes that it must be backed up with enforcement - The updated Guide went into effect December 1, 2009
Only “ sponsored ” communications are subject to regulation and transparent disclosure is required for “material connections”
There is potential liability for advertisers, advertising agencies, and endorsers for misleading and unsubstantiated statements made by the endorser
Don’t look at the FTC Guides in isolation - - they
have legal implications in other contexts

Understanding the Guide What is an Endorsement?
Any advertising message that consumers are likely to believe reflects personal opinions, beliefs, findings, or experiences of a person or organization other than the sponsoring advertiser
Endorsements include:
Verbal statements
Demonstrations
Depictions of the name, signature, likeness or other identifying personal characteristics of an individual
The name or seal of an organization
Endorsements do not include:
Fictional dramatization of a real life situation
Statements by an identified company spokesperson

Understanding the Guide Work with an Endorsement
Must reflect the honest opinions, findings, beliefs, or experience of the endorser
May not convey any express or implied representation that would be deceptive if made directly by the advertiser
Advertisers are subject to liability for false or unsubstantiated statements made through endorsements, or for failing to disclose material connections between themselves and their endorsers
Endorsers also may be liable for false or misleading statements made in the course of their endorsements

Understanding the Guide Disclosure of Material Connections
The Guides require the disclosure of any “ material connection ” between the advertiser/seller and its endorser
A “material connection” is information that could impact the weight or credibility a consumer gives to the endorsement
Disclosure must be clear and prominent
Language should be easily understood and unambiguous
Placement must be easily viewed and appear in a readable and noticeable font size/color
Types of “material connections”
Consideration given to a speaker or blogger by an advertiser in the form of benefits or incentives (e.g., cash; free products; prizes; special access privileges)
Relationship between the advertiser and speaker (e.g., employment)

Understanding the Guide Liability Issues
All stakeholders – whether advertisers, brands/companies, ad agencies, and bloggers or other agents – are liable for:
Their failure to disclose “material connections” and
The speaker’s making unsubstantiated claims about the products/services of the advertiser or brand
FTC now mandates that advertisers and brands develop policies that:
Educate their agents/endorsers about their responsibilities; and
Monitor the communications/statements/claims by their agents/endorsers.

A Partner Is Needed The Role of WOMMA
WOMMA launched Ethics Code in 2005 to provide consumers with insight into ethical standards online
In early 2009, began working with members and the FTC to submit comments regarding the Guide on behalf of the Word of Mouth industry
Through WOMMA’s “ Living Ethics ” project and in anticipation of the FTC Guide update, announced changes to Ethics Code re: compensation and transparent disclosure
New FTC Guidelines publicly noted WOMMA’s work on behalf of the WOM industry, specifically calling attention to the WOMMA Ethics Code
Today, WOMMA has:
Active, ongoing involvement with FTC to shape Guidelines
Advanced knowledge/understanding of the guidelines

Looking Forward The Role of Marketers
Educate “bloggers” regarding responsibilities Educate internal corporate audiences regarding responsibilities:
Create a “ culture of compliance ”
Require disclosure from “bloggers”
“ If you choose to review or share this product please be sure to disclose that it was provided to you by the company.”
Monitor to ensure disclosure is happening
Remind those who “forget” to disclose
Determine “cut off” policy for those who do not comply

Looking Forward The Role of Bloggers
“ Blogger” responsibilities:
Confirm understanding of responsibilities with marketers
Disclose all material connections on relevant platforms
Communicate proactively with marketer to demonstrate compliance

Best Practices Blog Disclosure
Personal and Editorial blogs
Disclose any product, service or compensation provided by a marketer
Disclosure requirement:
As part of editorial copy
“ I received ( product or sample ) from ( company name )
( Company name ) sent me ( product or name )

Best Practices Blog Disclosure
Review blog
Disclose any product, service or compensation provided by a marketer
Disclosure requirements:
As part of editorial copy
“ I received ( X product or service ) from ( company X ) to review”
“ I was paid by ( company X ) to review”

Best Practices Review Blogs: Disclosure & Relationships Section
WOMMA strongly recommends creating and prominently posting a “ Disclosure and Relationships Statement ” on review blogs to fully disclose how the blogger works with companies in accepting and reviewing products – and listing any conflicts of interest that may affect the credibility of their reviews.

Best Practices Comments in Online Discussions
I received ( product or sample ) from ( company name )
I was paid by ( company name )
I am an employee or representative of ( company name )

Best Practices Microblogs
Twitter
Must clearly state hash tag within tweet
#spon (sponsored)
#paid (paid)
#samp (sample)
Create link to “Disclosures and Relationships” section on profile

Best Practices Status Updates on Social Networks
Social networks:
Disclosure options:
As part of photo or video description (see photo and video sharing sites best practices)
As part of status update
“ I received ( X product or service ) from ( company X )
“ I was paid by ( company X )
Create “Disclosures and Relationships” section on profile

Best Practices Status Updates on Social Networks

Best Practices Video & Photo Sharing Sites
Video sharing sites
Disclosure options:
As part of video content
“ I received ( X product or service ) from ( company X ) to review/create this video
“ I was paid by ( company X ) to review/create this video”
As part of video description

Youtube user Jenergizer
“ I was contacted by the people at Harajuku Lovers fragrance… they’ve asked me to hold a contest…I’ve created an e-mail address for the contest and the deadline is September 21 st to send me 5 pictures of you and your friends that resemble the individual Harajuku dolls.”

Best Practices Video & Photo Sharing Sites
Photo sharing sites
As part of photo description
“ I received ( X product or service ) from ( company X ) to create this
“ I was paid by ( company X ) to create this”

Best Practices Podcasts
Include as part of the audio content and part of the written description
“ I received ( product or sample ) from ( company name )”
“ I was paid by ( company name )”

“… before we start I just wanted to let everyone know that today’s episode is sponsored by Tim Grace of Apartments.com”
episode 11: Apartment Marketing gone digital

Resources Are At Your fingertips
Word of Mouth Marketing Association
womma.org
Guide to Social Media Disclosure
womma.org/ethics/disclosure

Become a member of WOMMA
womma.org/members
Getting Involved

Questions?

Smdwebinarpredits 100302114418-phpapp01

by nancycheeseman on Jul 28, 2010

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