I Was Not Paid by the FTC for This Review – More on the New Guidelines
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In the last post I did on the new FTC regulations, I went over how the new rules would affect endorsements. In this post, I’ll go over the part that will affect bloggers more than anyone else, although it will still have repercussions for other online marketers as well.
The second part of the new FTC regulations that directly affects online marketers is the new requirement of “disclosure of material connections”. This requires you to fess up to any connection you have to the product or service that you are mentioning, be it that you flat out got paid to try it, you did it in return for free product, or if you just got a free trial. The big difference is if you just got the free trial because they were letting a bunch of people try it, or if they let you try it specifically because you would mention it in your blog. Here’s the specific example that they give about blogging in the FTC Guidelines:
- A consumer who regularly purchases a particular brand of dog food decides one day to purchase a new, more expensive brand made my the same manufacturer. She writes in her personal blog that the change in diet has made her dog’s fur noticeably softer and shinier, and that in her opinion, the new food is definitely worth the extra money. This posting would not be deemed an endorsement under the Guides.
- Assume rather than purchase the dog food with her own money, the consumer gets it for free because the store routinely tracks her purchases and its computer has generated a coupon for a free trial of this new brand. Again, her posting would not be deemed an endorsement under the Guides.
- Assume now that the consumer joins a network marketing program under which she periodically receives various products about which she can write reviews if she wants to do so. If she receives a free bag of the new dog treats through this program, her positive review would be considered an endorsement under the Guides.
So, even though she got the food for free under one of the examples, it wasn’t considered an endorsement, and she didn’t have to disclose a material connection. Now, to me that states that the difference is all in the intent. If you’ve been given a product specifically for marketing purposes, then you need to disclose that. If you got the product for free, but in a way that anyone could get it for free, and not because you have a blog that you can mention it on, then you’re ok (although you might want to share with your blog readers where you got the free stuff!)
If you do receive free product or other compensation, just disclose it. Be upfront about it, “Hey, so and so gave me this to try out, just so you know, but this is still my opinion about it. If you’ve always been upfront about what you’re reviewing and why, you should be ok. It also helps to be picky about what you’re reviewing; stick to things that you really believe in, and even if you are being compensated, your readers are more likely to take what you say at face value. Get into the habit of reviewing things indiscriminately, and you’ll lose the trust of your readers.
Or, you could do what I recently decided to do, actually before these regulations came into affect – I stopped accepting paid reviews You can go back and check out that post “New FTC Regulations“. Plus, I always listed paid reviews as “review me reviews’ so that my readers (you guys) could differentiate between that and other reviews I did.
Another thing I will have to do (which I’ve been doing anyway) is let you know when I’m promoting one of my own products. Most of you know the other sites that I’m involved in, like Portal Feeder, and PPC Kahuna and Traffic Kahuna, and now Web2Mayhem (it’s new! Go check it out at http://web2mayhem.com (it is super powerful… sorry couldn’t resist). But now, when I do a post about any of that, I will have to explicitly state my connection for anybody who wasn’t aware, for the sake of complete transparency.
Next post in Series: 8 Questions You Must Ask Yourself About The New FTC Guidelines
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Nice, my new site investimonials offers reviews on 3,000+ financial products like brokers, websites, blogs (JC you’re gonna be on there soon enough!) and I gotta disclaimer up because we actually reward people who have helpful reviews with free products…but disclosure is better than fine ebcause it goes to promote our program!
Yeah FTC is becoming stringent. The regulations about writing good things to endorse a product might attract problems. But how about writing a disclosure type. Say “Remember I might get paid if you buy after going through my website etc?”
I believe that will be a good practice. This will generalize and will serve the purpose in my opinion
Nice article, you’ve explained the things showing the niceties of the FTC regulations. I personally feel that the new FTC regulations are good for the sake of transparency and it lets the user decide for himself after reading the opinions expressed on various websites.
Well, even I am in the web design business in Mississauga, I think FTC regulations are good example of what to follow. It is good way to let the visitor make an own decision.
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Nice post. I’m enjoying reading your examples and explaining the FTC rulings in your own words rather than reading actual the boring multi-page guidelines itself.
Though it is probably important that I read it in full eventually if I plan to sell products and receive free products to review in future. But it seems clear that you just need to disclose everything and make sure you’re honest with your readers.
BTW when you click on your web2mayhem.com link it doesn’t work – think you forgot to put in the url when clicked on
(you can edit this part of the comment out when you’ve fixed it!)
Sarge | BeginnerBlogger.com
Nice article, you’ve explained the things showing the niceties of the FTC regulations. I personally feel that the new FTC regulations are good for the sake of transparency and it lets the user decide for himself after reading the opinions expressed on various websites.
Yeah everyone needs to get on board with this. You can see why they dide it; there’s a lot of fake “review” sites out there.
This was a good move because this will down play a lot of useless posts on websites.
Good post. I’m about to start up my first blog and I found this really helpful.
its been obvious for some time that sites were giving fake biased reviews – could sites offer a disclaimer somewhere on the site that informed users of its true standing on reviews(most peeps would,nt bother to read it).
Good stuff, you should always be upfront from the jump, folks know I get stuff in to review, they still value my opinion.
No point in trying to hide anything, I was never that type of site owner.
If you hire a writer to write reviews for you, that writer is being compensated, so remember to include a disclaimer.
BTW – you can tell you have a writer-for-the-web who keeps up with the profession if he or she already knows about this.
Great post Jason. The information is great. It helps when someone like yourself takes the time to discuss important matters like this.
Thanks
Jason Berkes
Thanks for the post Jason.
Personally, I don’t believe that the new FTC rules will change much of anything. Unless, of course, you are in the particular league of folks that are really raking in the dough off of endorsements and such.
If you really think about it, how is the government going to monitor the hundreds of thousands of internet marketers. It’s impossible. They don’t have the resources to do it.
I am beginning to think that this is just a scare tactic to make people be more honest and I don’t see anything wrong with that.
Keep up the great work. You are one of my idols.
Great post!
I have spent the last couple of hours learning about this, so your email came just at the right time
I read through a length discussion on Warrior form and certainly this is a Hot topic. I think its a good move, as hopefully it will help to ‘clean’ the web of some pretty shady folks. However, its a big playing field and I am sure a lot of these scams will still exist. I would image your sites ranking would be improved (I think it already does to a degree), as the SERPs and directories get smarter and they start to ’slap’ sites missing these key disclosure statements, privacy policys, etc. I think for those of use trying to run a honest business, that take some time to exercise ‘due diligence’, we shouldn’t run into too many problems.
Thanks Jason!
Jeromy
Step 1 – at least its a step in the right direction … but we need 99 more steps to get rid of the “real” problem.
Plus we need a “policeman-policeforce” … good luck!
Hi,
Seems funny that all these small time internet marketers are shaking in their boots over the FTC. Come on get real. The FTC has never been a federal agency to get worried about especially if you are small time. Now the big guys, maybe, just maybe at most….
I thought I’d see more changes on sales letters and blogs, but it seems that blogger and marketers will make the changes after the new year.
Franck
The new FTC rules, like most federal policies, cut with a picnic knife not a Ginsu. (No, I am not and do not sell, recommend or profit from the sale of 14 piece cutlery sets.) That doesn’t mean one can ignore the rules, but square shooting blogs and web pages (sites that actually offer something of value as opposed to dressed up MLM plans and no effort millions) are not the focus of this law. At its heart the rules are aimed misleading and exaggerated statements likely to confuse or mislead unwary consumers (the public, which we know is getting dumber all the time with help of their over-paid lawyers). If you use a squeeze page as your landing page expect to make the FTC watch list. If you have seen any of the “make a six-digit income in the next 5 minutes” sites with my “unknown method”, you probably have also seen the “user” claims. I used to regularly follow the domain names of these magical money hounds. You guessed it; most of the sites were off, holding pages from registrars or dead links. Therein lies the key to the FTC is looking for: fraud, lying, misleading and puffing beyond “this Yugo is the greatest car since Honda!”
If you are building loyalty to make living, fraud and misleading is not going to get you far–although a paid vacation on your state or the fed might come your way. If you want to have a loyal following that bleeds into cyber-friendship and support, you probably are not engaging in the disallowed activity(s). If you recommend your users buy a product, let know from where you are coming.” Yeah, I use it and I like because of a, b, and c.” or “We use this software and loved so much we are now an affiliate seller. Click here.”
As for Google ads and other paid for space banners, that was not the thrust of this FTC rule. However, I suppose one could misrepresent those ads in fashion to get the FTC on your case. But why do that if loyalty is what you seek? The rule to follow is simple: Honesty is the best policy. If someone buys a Yugo, I happened to like the little rat trap, on your recommendation just make sure to add the qualifier, “I tried it and I liked personally because…” or “Yes, I got paid $50 bucks to tell you about these cars, but I still like my Yugo because it is so cute.” Common sense rules. If what you are publishing misleads, you don’t want that on your blog anyway. If it is your opinion, take ownership of that. If you are an affiliate marketer, tell people why. (My rule has always been, if I can’t recommend it won’t be linked on my site(s).) And, honestly, I never really cared what Wally in Farley, IA thought of some manhood pills.
Speaking of honest, I used call QuickBooks, “QuackBooks”. Then I did a five year stint with a corporate management accountant. I learned how QB really worked. Now I am an affiliate marketer. Buy Quickbooks from my site because it IS worth very penny. (That is okay under rules.) Actually, if you are in business, YOU NEED this software.
As a blogger, you want to use only those words, phrases and graphics that build trust. The ones that run afoul of the FTC rule don’t. Yeah, honesty–it is that simple. Remember Victor Kiam. “I liked the razor so much, I bought the company.” It doesn’t get any better than that.
I agree with many of the comments. Fakey testimonials and such are going to go under the microscope of the FTC – with good reason. I think the golden rule, honesty is the best policy, got lost under the gold rush, so it’s good to go back to the basics again.
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Although some of the new requirements set by the FTC in regards to disclosing affiliation are a bit of a hassle, I think it is generally a step in the right direction. I think it’ll make marketers strive for better overall quality as opposed to simply pushing products. And the thing is, if you do a little market research for the top niches and look around at some of the “authority” sites made by marketers, the ones going strong are the ones that are more about quality as opposed to push, push, push!
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