Episode 28: Dissecting Disclosures and the FTC Guidelines
In December 2015, the FTC issued Guidelines instructing companies and influencers on how they should conduct themselves concerning paid sponsorships on online posts and other content. The update in how these Guidelines have been enforced has been an interesting talking point in the legal community. Online Editor Anthony Zangrillo and Kathy Walter discuss these issues.
The podcast is also joined by Special Guest Doreen Small,1 a founding partner of Marquart & Small LLP, a highly regarded intellectual property lawyer and a foremost expert in the field of fashion modeling law. Her practice focuses on advising and counseling clients on a wide range of contractual, transactional, intellectual property, regulatory and employment law matters in the fields of fashion, arts, fitness, hospitality, media and entertainment.
Doreen discusses her exposure to companies pushing compliance with Guidelines onto bloggers, influencers and models through contractual agreement. In practice, the FTC has enforced these Guidelines on bloggers and models, but not always on celebrities and red carpet guests who accept constant swag in their everyday life. The advertising model has changed and every company puts ad dollars into these online mechanisms. Influencers and blogs really do have influence and sway over an important demographic. Often, these new technological changes involving social media in the industry are accompanied by normal modes of advertising, such as print and billboards. However, exclusive print advertisements have become very rare.
The podcast discusses the concern in misleading “paid-for” content that is disguised as normal editorial pieces. Is there a lack of awareness on the part of the consuming public to the payments involved to get someone to wear their clothing? How does the FTC utilize its standard of deceptiveness, regarding whether a reasonable number of prudent customers would be fooled? Is the concern among influencer’s concerning authenticity with their consumer base justified? How can lawyers draft contracts to push the burden of compliance with the Guidelines back on the companies asking for sponsorship, rather than placing the burden on the influencers themselves?
Finally, Anthony, the influencer himself 2 discusses his own exposure to the Guidelines concerning his movie and video game reviews. What is the FTC’s application of these Guidelines to free tickets to live events, and furthermore exclusive gatherings such as a movie premiere or after party? This topic brings up the issue of uniformity of enforcement among industries, such as film, fashion, media, and gaming.
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Editor’s Note: This podcast was recorded prior to the FTC’s press release reminding influencers and brands to clearly disclose relationships with sponsors. In its blog post, the FTC recommended three steps that influencers should take to ensure the effectiveness of disclosures on Instagram:
Keep your disclosures unambiguous.
Make your disclosures hard to miss.
Avoid #HardtoRead #BuriedDisclosures #inStringofHashtags #SkippedByReaders.
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