Regulations

Brands: Get Up to Date on Federal Trade Commission Guidelines

Guest Writer
Co-Founder and CEO of Open Influence
3 min read
Opinions expressed by Entrepreneur contributors are their own.

If you’re a brand that is advertising anything online, it is critical to know how to comply with Federal Trade Commission (FTC) guidelines. If you’re a brand that is actively advertising on social media, there are even more nuanced rules you need to be aware of.

Understand influencers.

The current preferred method of advertising on social media is through influencers, popular content creators who’ve amassed large followings based on the merit of their content. The FTC has implemented consumer protection laws to ensure that items and services for purchase are accurately being portrayed by brands, which extends to their portrayal by influencers.

As brands continue to partner with social media influencers through paid advertisements, they need to be more than just aware of the FTC guidelines, but compliant. The FTC has already taken action against companies who have not followed suit.

This past June, the FTC updated their guidelines for brands for the first time since 2010. While their underlying message has not changed, they have added updated guidelines for social media issues that did not exist in 2010.

Related: Court Rules FTC Can Come After Your Company After a Cyber Attack

Disclosure is key.

Influencers are trusted by their audience as experts on certain topics or content categories. Therefore, they’re trusted authorities within their respective fields, so its important for them to respect the trust they’ve earned from their audience and draw a distinction between a personal recommendation and a sponsored recommendation. Influencers who are posting must clearly and conspicuously state their relationship with the brand. The golden rule for influencers is: When in doubt, disclose.

Contest and sweepstakes are no exception to the FTC. When an influencer is promoting a contest on their social media account, a clear disclosure needs to go along with it. In this case, the responsibility falls on the contest’s sponsor, so if your brand is promoting a contest through influencers, make sure that they are aware of this important responsibility.

On Twitter, the FTC does not take the 140 character limit as an excuse for non-disclosure. They recommend that influencers use #ad, since it takes only three characters to be in compliance -- and tweet real estate is precious.

Related: Apple's Tim Cook Made a Rookie Mistake and Might Face SEC Sanctions

Advertisers and influencers need the same voice.

Successful social media advertising needs to be able to fall in line with the influencer’s existing voice. Consumers look to their favorite influencers for their recommendations, regardless of whether or not they are engaged in sponsored posts, so it’s not just the FTC that influencers have to worry about when disclosing sponsored content.

Consumers are quick to judge when advertising on social attempts to be surreptitious. It is therefore important for influencers to follow guidelines not only because of legal requirements, but also because they can serve as helpful guardrails for influencers to maintain transparency for their followers.

To keep your brand safe, make sure that the influencers you partner with are aware the FTC’s guidelines. These are not just suggestions, they’re requirements, and no brand wants to be made an example of by the FTC.

Related: No Eggs, No Mayo: FDA Goes After Hampton Creek for Naming Its Vegan Spread 'Just Mayo'

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