Bloggers and social networking sites must be honest in all forms of marketing
FTC plans regulations for online marketing
/v3-uk/news/1985560/ftc-plans-regulations-online-marketing
03 Apr 2009, Iain Thomson , V3
The Federal Trade Commission (FTC) is planning to regulate online viral marketing that uses blogs and social networking sites.
Marketers are spending billions worldwide to get the endorsements of key bloggers and groups on social networking sites. One tactic, used by Microsoft and others, is to send products to bloggers on 'long-term loans' on the understanding that they will comment about them on their sites.
Under the new regulations being proposed, such bloggers would be legally liable if they make untrue statements about the products or services. The companies too would face sanctions.
"This impacts every industry and almost every single brand in our economy, and that trickles down into social media," Anthony DiResta, an attorney representing several advertising associations, told The Financial Times.
This is the first revision of the rules on this kind of advertising by the FTC since 1980 and is needed, according to the organisation, because new forms of communication have opened up new fields to marketing.
"The guides needed to be updated to address not only the changes in technology, but the consequences of new marketing practices," said Richard Cleland, assistant director for the FTC's division of advertising practices. " Word-of-mouth marketing is not exempt from the laws of truthful advertising."
Advertisers are resisting the changes, however, which threaten a highly effective form of marketing new products and services.
"Regulating these developing media too soon may have a chilling effect on blogs and other forms of viral marketing, as bloggers and other viral marketers will be discouraged from publishing content for fear of being held liable for any potentially misleading claim," Richard O'Brien, vice president of the American Association of Advertising Agencies, said in an advisory to the FTC.
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Do you agree?
Advertising is not regular speech
There is a big difference between blogging to make a point, or social discussion and blogging to sell a product or influence consumer opinion for gain (or to harm a competitor).
Advertising is not free speech. However determining what new media is and is not advertising will be harder in practice than in theory.In all I welcome a move to stem the tidal wave of BS marketing going on online. Those of us who have legitimate services and products to sell (as well as consumers) will be better off.
Posted by Andre Vatke, 07 Apr 2009
@Jane
Your comment assumes that personal responsibility wasn't dead.
Posted by Mike, 08 Apr 2009
What about free speech?
Isn't it the consumer's responsibility to weigh the words of several sources before making a purchase? Isn't the point that, if the source turns out to be unreliable, the consumer never uses it again? Why does that have to be yet one more thing the government controls? Reputation and WOM go hand in hand. These bloggers who are corrupt will put themselves out of business by having no readership!
Posted by Jane, 04 Apr 2009
Responsibility isn't dead
The wave of new technology applications and their opportunities should not push aside the responsibility of marketers and the companies that they respesent from providing truthful insights to their products and services. This is the true spirit of the legitimate entrepreneur and those who represent him.
Posted by Mike Warlick, 13 Apr 2009
Waste Of Government Money
Doesn't the Government have enough problems to deal with? My tax dollars should not be spent on overpaid forum police that try to track down rogue bloggers! This is the first step that leads to basic online censorship and the death of pure capitalism online.
Posted by Jason, 13 Apr 2009
Waste of Government Money Response
I'm sorry, but if it weren't for corporate WASTE in the name of capitalism, maybe the government wouldn't have to step in. People are desperate and falling victim to an empty claim or promise will only exasperate the problem!
Posted by Linda, 10 Nov 2009