Law360 interviewed Partner Karl Kronenberger for the article, “FTC's Social Media Promotion Guide Has Marketers Confused,” discussing the Federal Trade Commission’s (FTC) revised advertising endorsement guidelines that address a variety of issues relating to endorsing products on social media. As background, Mr. Kronenberger discussed the growing importance of product reviews on online marketplaces such as Amazon, mentioning that many consumers will decide to purchase an item based off reviews, many of which are provided in exchange for free products or other incentives without disclosure of the free product to the consumers reading the reviews. “Amazon is such a massive part of the Internet economy these days, and it’s easy to game the system with reviews,” he adds. Mr. Kronenberger explained the important of advertisers complying with FTC guidelines in this area by instructing reviewers to fully disclose free products or other incentives provided before or after the review.
Under the FTC’s new guidelines, affiliate marketers, such as bloggers, who get paid if a reader clicks on an affiliate link to product, can also be deceptive without proper disclosure that the marketer or blogger may receive compensation for purchases made after clicking on the affiliate links.. Mr. Kronenberger advises, under these new FTC guidelines, “there has to be a disclosure somewhere in close proximity to the link… .” However, it is still unclear if affiliate marketing networks are responsible for ensuring bloggers and reviewers comply with the FTC’s endorsement guidelines.
This entry was posted on Tuesday, August 04, 2015 and is filed under FTC Advertising Law Compliance, Internet Law News.