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Spreading The Influence: FTC Issues New Guidance for Influencers

The U.S. Federal Trade Commission (“FTC”) continues to focus on influencer advertising, as part of its consumer protection mission.  On November 5, 2019, the FTC released an instructive “Disclosure 101” Guide and “Advice for Social Media Influencers” video to help influencers understand their legal obligations when they are spreading their influence through social media posts, videos, or other media channels. Links to the Guide and Video are here.

In plain, non-legal language, these materials remind influencers that they have a legal obligation to make sure that their messaging is not deceptive.  While the legal obligations of advertisers and influencers/endorsers are addressed in the more formal FTC Endorsement Guides, at 16 CFR Part 255, the new FTC releases are succinct guides intended for non-lawyer influencers, vloggers, bloggers and the like. They are good refresher resources for advertisers and brand owners as well.

The FTC points out that influencers should include disclosures in their messages to acknowledge their relationship with the brand.  Those disclosures should be clear and obvious – “hard to miss.”  The key point: influencers should make a disclosure whenever they “have any financial, employment, personal, or family relationship with a brand.”  That includes if an influencer received free or discounted products, or a trip, or anything of value from the brand – and even if the influencer was not asked to promote or review the product.  The FTC reminds influencers that “liking,” tagging or pinning products or brands, or reporting others’ comments, can also be endorsements triggering disclosure obligations.

Disclosures can be made explicitly in the text or video, or they can be via a prominent and obvious hashtags—such as: #Ad or #Sponsored or #BrandAmbassador.  A Disclosure Hashtag should be first or second on the list—and not buried in a hashtag blizzard.  And disclosures should be “above the fold” (to mix media references) – that is, before a consumer has to click for “more” or “read more”.  Abbreviations such as “Sp” or “spon” or just noting “thanks” or “ambassador” do not suffice, in the FTC’s view.

The FTC advises that in picture posts – e.g., on Snapchat or Instagram Stories — the disclosures should be superimposed on the pictures, and in video posts, they should be given both verbally and in writing superimposed on the video.  Using disclosure “tools” that some social media platforms have established are not sufficient disclosures, according to the FTC, nor are disclosures in an influencer’s profile.  Rather, the required disclosures should be clear, straightforward and prominent – and in each message.

The Disclosure 101 Guide also reminds influencers that their messages should be truthful and reflect the influencer’s own experiences: “If you’re paid to talk about a product and thought it was terrible, you can’t say it’s terrific.”  The FTC also advises influencers: “You can’t make up claims about a product that would require proof the advertiser doesn’t have – such as scientific proof that a product can treat a health condition.”  That is a succinct way to remind influencers—and the advertisers—that the advertisers are required to have independent substantiation for product claims made by influencers.

The take-away?  Influencers need to understand basic “Truth in Advertising” principles, including the requirements to affirmatively disclose brand relationships and to avoid making unsubstantiated product claims.  And advertisers should double-check that their influencers know about those requirements and will comply with these legal obligations.  The FTC’s Disclosure 101 Guides could be appended to contracts – along with other brand-specific guidance for the influencers.

On the advertiser side, advertisers continue to focus on ways to increase transparency and measure influencer effectiveness, including third-party verification methods.  FTC Commissioner Chopra recently commented:

“Fake reviews distort our markets by rewarding bad actors and harming honest companies.  The problem is growing, and the Federal Trade Commission should attack it.”

By educating influencers and advertisers about their legal obligations, the FTC Disclosure 101 Guide and Video are part of the FTC’s continuing efforts to attack deception in social media promotions.

© Copyright 2019 Squire Patton Boggs (US) LLP

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About this Author

Deborah M. Lodge, Squire Patton Boggs, IP Lawyer, Privacy Attorney, Internet law
Partner

Deborah Lodge specializes in intellectual property, privacy and Internet law. Among her diverse clients are financial institutions, communications and media companies, retailers, and technology pioneers. With her broad legal experience and practical business perspective, Deborah helps clients achieve their strategic goals while complying with the legal regulations that govern privacy, e-commerce, and advertising.

Deborah advises clients concerning privacy and data security, social media, cybersquatting, telemarketing and consumer protection...

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