As I mentioned last week, I will be continuing to discuss the FTC’s updated answers to its FAQs. This week, Advertising, Marketing & Promotions Partner Allison Fitzpatrick and I will focus on influencers and ambassadors, celebrity endorsements, and social media and promotions. Stay tuned for our last post in the series on online reviews, employee endorsements, monitoring.
Influencers and Ambassadors
In response to whether the Guides applied to influencers and ambassadors who are hired to promote a product or business on social media outside of their work hours, the FTC cautioned that these influencers and ambassadors have a financial connection to the company that hired them, and that relationship exists whether or not they are being paid for a particular tweet. For example, if an ambassador is hired by a conference and endorses the conference in his or her tweets, the audience has a right to know about the relationship between the ambassador and the conference. That said, if the ambassador’s tweets simply respond to questions about the event, those tweets may not constitute endorsements because they do not communicate the ambassador’s opinions about the conference (e.g., if a person asks for a link to the conference agenda).
However, if the ambassador is responding to a person’s questions about the event via email or text, that person may already know about the ambassador’s affiliation with the conference so that a disclosure may not be required in that context. However, when the ambassador responds via social media, all of the ambassador’s followers will see the posts and may not know that the ambassador has a relationship with the conference.
In response to whether posting the conference’s badge on the ambassador’s Twitter profile page would be a sufficient disclosure, the FTC advised that a disclosure on a profile page is not sufficient because many people in the audience will not see it. In addition, depending upon what it says, the badge (e.g., a logo or hashtag) may not adequately inform the audience about the ambassador’s connection to the conference.
Whether celebrities who regularly charge advertisers to mention their products must disclose that they are being paid to tweet about products, depends on whether their followers understand that their tweets are paid endorsements. If a significant portion of their followers do not know that their tweets are paid endorsements, a disclosure would be required. Because this may be difficult to show, a disclosure is recommended.
Social Media Promotions
The FTC reiterated its guidance in the Cole Haan investigation – entry into a sweepstakes or a contest for a chance to win a thousand dollars in exchange for an endorsement could very well affect how people view that endorsement so that a disclosure would be required.
A disclosure that includes the name of the product in the hashtag (e.g., #XYZProduct) would not be sufficient because the hashtag does not indicate that the posts were in response to a contest, or that the entrants received something of value (e.g., a chance to win the contest prize) in return for the posts. Making the word “contest” or “sweepstakes” part of the hashtag would likely be sufficient, but the word “sweeps” would not be sufficient because people may not understand what that the term means.