Seen an increase in social media posts from celebrities and influencers using “#ad” or “#sponsored” lately?
That’s because the FTC (Federal Trade Commission) has been cracking down on social media influencers and their paid relationships with brands. After seeing an influx in celebrity and influencer endorsements and ads on popular social sites – most of which fail to feature any kind of relationship disclosure –, the FTC has started to carefully monitor these postings.
According to FTC guidelines, if a social influencer has a monetary relationship with a brand, then they must disclose that relationship to their audience. This includes:
- a flat fee for a post
- commissions on sales
- free products for review
- anything else the brand may provide the influencer in exchange for their post.
A lot of influencers and celebrities leave this important information out. In the eyes of the FTC, this is considered deceptive behavior; they aren’t being transparent with their audience that their opinions and views on a brand could be influenced by compensation.
Convictions about Character Limits
Many influencers cite character limits on certain social platforms, such as Twitter, as the reason behind their lack of disclosure in posts. The FTC disagrees and has made it clear that character limits don’t change the influencer’s obligation to disclose that they have a relationship with the brand.
The FTC actually takes this one step further. They’ve stated that the disclosure should be included in the first part of the post’s text. For example, if the post is promoting a brand, product or service, then the influencer needs to include something like “#ad” at the start the post; “#ad” should not be buried among other hashtags at the end of a post where a reader is most likely to skip over and not notice it.
Since there is no set language of the disclosure provided by the FTC, the best practice for an influencer is to ask themselves, “Would an average reader understand that there is a monetary relationship between myself and this brand?” Based on the answer, they should adjust their post accordingly to ensure it’s clear and concise for their audience.
FTC Disclosure Do’s and Don’ts Your Influencers Should Follow:
- Place the disclosure at the beginning of the post. This ensures a reader will see it and not skip over it.
- Use a hashtag such as, #ad or #sponsored.
- Tag the brand and use the phrase “Sponsored by (brand name)” in the caption.
- If the content is in video format, include it in the written description section as well as noting it at the start of the video.
- Burry the disclosure or the #ad among other hashtags at the end of a post.
- Use abbreviations a reader may not understand such as “#spon” instead of “#sponsored.”
- Forget to verbally mention it in video content.
- Use language the average consumer would not understand and make it as simple as possible.
The Case of TmarTn and Syndicat
A recent example of influencers not disclosing properly came to light with YouTube Influencers, Trevor Martin and Thomas Cassell (TmarTn and Syndicat). According to the FTC, they deceptively endorsed an online gambling platform, CSGO Lotto by not disclose the fact that they owned the company!
They posted videos of them winning money from the gambling site and tweeted about their winnings as well. They also paid other influencers to endorse the gambling site who failed to disclose that they were receiving payment from Martin and Cassell for their posts and reviews.
So, what happens to a company like CSGO Lotto once the FTC discovers their unscrupulous marketing activities? It’s often not much more than a slap on the wrist and a promise to disclose more clearly in the future. Unfortunately, as many brands and above-board marketers would agree, that doesn’t do much to deter this kind of base behavior.
That said, this kind of FTC attention is definitely a black eye for CSGO Lotto. It’s not the kind of publicity that most credible companies would want for their brand.
In light of the CSGO Lotto case, the FTC has updated their FAQs, adding more than 20 commonly asked questions that influencers and marketers ask and the answers to them.
Safeguarding your Brand
While social media is a great space for influencers and affiliates, it does require close and consistent monitoring. At Acceleration Partners, our practice is to run quarterly FTC checks for all of our clients. If we find an affiliate who is not compliant with FTC guidelines, we proactively reach out and make sure they add the proper disclosure, no matter what platform the post may live on.
To help ensure your marketing partners are properly disclosing their relationship with you in their marketing content, check out our blog post, 5 Ways to Ensure your Marketing Partners Comply with FTC Disclosures.
For more FTC guidelines please visit the following links:
FTC’s “Dot Com Disclosures” Guidelines: http://www.ftc.gov/os/2013/03/130312dotcomdisclosures.pdf
FTC’s Endorsement Guidelines: http://business.ftc.gov/advertising-and-marketing/endorsements
The FTC’s Endorsement Guides: What People Are Asking: https://www.ftc.gov/tips-advice/business-center/guidance/ftcs-endorsement-guides-what-people-are-asking