FTC Zeros in on Social Media Influencers and Those Who Use Them

FTC Zeros in on Social Media Influencers and Those Who Use Them

May 4, 2017

by Jerry Glover

In 2009 the Federal Trade Commission issued guidelines for those who endorse a company’s products or services and for the companies which use celebrities and others to endorse their products/services. Those guidelines defined an “advertising message” as “one that consumers are likely to believe reflects the opinions, beliefs, findings or experiences of a party other than the advertiser.” Since the FTC issues the endorsement guidelines, social media has become even more vitally important for a company’s marketing and advertising plans. And who can attract more attention on social media than some type of celebrity?

Until now, most enforcement actions by the FTC under these endorsement guidelines have been against companies. But in late April the FTC issued over 90 letters to not only company but also to so-called “influencers” reminding both categories that the endorsement guidelines still exist and noting certain things that must be disclosed by the influencer (and tended by the company) concerning the influencer’s connection to the company. The FTC did not identify the recipients of these letters.

The letter reminded influencers that any connection they have with companies should be clearly and conspicuously disclosed in social media. That connection could be a family relationship, monetary payment or giving the influencer free products. In order to make the disclosure clear and conspicuous, the letter explained, the influencer should use unambiguous language and make the disclosure stand out so the consumer will notice the disclosure easily. The FTC used one example to avoid: a post on an influencer’s Instagram stream may show only the first three lines of a longer post to consumers unless they click “more”. Many consumers, the FTC argued, do not click more. Therefore, influencers are required to disclose their connections to the company above the “more” button.

The FTC also cautioned that multiple hashtags in a message from an influencer are often skipped over by consumers especially if they appear at the end of a long post.

The letter the FTC sent to companies reminded companies that they are required to manager those who endorse their products/services. Those companies must also monitor posts and other messages from endorsers to insure they meet the FTC’s endorsement guidelines. The FTC encouraged those companies who do not have a written social media policy to develop one sufficient to provide the necessary guidance to influencers.

These types of warnings from the FTC often lead to more formal actions against specific individuals/companies. If you receive some form of consideration to endorse a product/service or if you are a company that uses influencers, please heed the warnings in these letters even if you did not receive one.

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