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Aug 07 Brands Aren’t Going to Like the FTC’s Next Move on Influencer Marketing

The FTC continues to send warnings, but it won't be long before someone gets more than a hand slap.

For nearly eight years now, the Federal Trade Commission has been consistently, but somewhat gently, warning both influencers and brands that they must disclose when an influencer marketing post has been, well, influenced by marketers. From guidance issued in October 2009 to a more formal Engagement Guide first issued in December 2015 to warnings to 90 influencers in April 2017, each FTC move has provided more specificity around this otherwise consistent theme. But compliance is still erratic.

Improper FTC disclosure examples by celebrities

The FTC’s fairly obvious next step, therefore? Make an example out of a well-known brand to show that they’re serious.

In those April letters to influencers, the FTC wrote:

"…if there is a ‘material connection’ between an endorser and the marketer of a product – in other words, a connection that might affect the weight or credibility that consumers give the endorsement – that connection should be clearly and conspicuously disclosed..."

They also clarified what they meant by clear and conspicuous disclosure:

"…you should disclose any material connection above the ‘more’ button. In addition, where there are multiple tags, hashtags, or links, readers may just skip over them,
especially where they appear at the end of a long post..."

They’ve also provided clarity that hashtags such as #spon, #partner and #collab are not sufficient to meet the standards. But it’s not the influencers that are going to be punished. In their Endorsement Guide on the subject, the FTC makes it clear that brands, or their agencies, are most likely going to attract their attention.

Q. Are you monitoring bloggers?

Generally not, but if concerns about possible violations of the FTC Act come to our attention, we’ll evaluate them case by case. If law enforcement becomes necessary, our focus usually will be on advertisers or their ad agencies and public relations firms. Action against an individual endorser, however, might be appropriate in certain circumstances.

The pattern here becomes clear. Despite general guidance in 2009 to increasingly clear rules today, the FTC has settled only one complaint against a brand (Lord & Taylor in March of 2016) and that settlement largely involved the brand simply promising not to do it again.

Despite that, the FTC one year later still needed to warn another 90 influencers that they were not in compliance. So, while their relatively measured process has been somewhat effective (in that brands, agencies and influencers that are eager to comply now have the framework within which to do so), too much non-compliance still exists.

Given their efforts to date and the continued compliance problems, it would be logical for the FTC to look for that case that gets everyone in the industry talking. Our company has numerous protections in place to ensure that none of our clients become “that case.”  All brand managers charged with influencer marketing would be wise to do the same.