ASE09 Session: Hot Topics in Marketing Compliance and Enforcement

Posted on Aug 17, 2009 in Affiliate Marketing, Conferences & Networking | 1 comment

Session Description: Hear from regulators and industry insiders on critical legal issues facing affiliate marketers today, including advertising practices, affiliate liability, and enforcement priorities. The panel consisted of:

With all the talk about disclosure going on lately, I thought this session would be a great chance to learn more about how the FTC expects to enforce the over-zealous disclosure they’re now talking about requiring.  I was disappointed that there was no mention of it until the end of the session and that no one asked about it before I had to leave.  The session went long and I had to run to get to GeekCast Live.  It was definitely a wealth of information; I just wish Jeffrey hadn’t talked and gone through his slides so fast!

Bullet Point Review!

  • Affiliates need to be careful about the types of endorsements they use.
  • Affiliates can get into trouble using celebrity pictures and trademarks.
  • Epic Advertising does their research to make sure testimonials used are legitimate and documented.
  • There’s no silver bullet.
  • Noncompliance is more lack of attention to detail than maliciousness.
  • Even if a celebrity endorsement is true, you need their explicit consent to use it.
  • What is Advertising?
    • Traditional Media
    • Company Sites
    • Public Relations
    • Spokespeople
    • Branded Content
    • Viral Videos
    • Product Placement
    • Review Sites
    • Facebook Pages
    • Blogs
    • Tweets
  • What Rules Apply?
    • Federal
    • State
    • Local
  • Deception
    • Tell the truth and don’t mislead.
    • Keep your promises.
    • You’re responsible for express and implied claims.
    • You must have prior substantiation to back up your claims.
  • FTCv. CVS Pharmacy Case
    • Accused of misrepresenting how they were protecting customer privacy.
    • Found that discarded customer information was thrown into dumpsters behind the stores that were accessible by anyone.
    • Held accountable.
  • Disclosures
    • Is qualifying information necessary to prevent a claim from being misleading?
    • Disclosure must be “clear and conspicuous”.
    • Mouse type probably won’t do the truck.
    • Is the disclosure in close proximity to the claim?
    • Disclosures are judged by a performance standard.
  • No pre-checked boxes.
  • Disclosures must be separate from terms and conditions.
  • Endorsements
    • Must be real.
    • Honest, unbiased opinions.
    • Accurately reflect performance.
      • You can’t use an endorser to make a claim that you couldn’t make yourself.
    • Subject to FTCreview.
    • “Results Not Typical”
  • Unfairness is about harm, not about deception.
  • ERSP is a self-regulating body.
  • No real punitive damages; can only recommend changes to be made.
  • Clinically proven claims have to be reliable and competent evidence.
  • Clinical Testing Data
    • Independently conducted (double blind study, placebo controlled).
    • Adequate sample size.
    • Conducted over a reasonable period of time.
    • Statistically significant results (95% confidence level).
    • Claims = data.
  • Affiliate has the responsibility to confirm that the claims are true.
    • There are some obviously questionable categories of offers that should always be questions before run, like nutritional supplements, weight loss, etc.
    • You as an affiliate can be held individually liable for damaged in a lawsuit.
  • FTC has two responsibilities – consumer protection and anti-trust.
  • The Obama administration has put pressure on the FTC to look to protect consumers heavily affected by the economic downturn.
    • Extra scrutiny of loans, mortgage, jobs, debt consolidation advertising.
  • Be careful when marketing to children as the rules are becoming more strict.
  • Is it okay to collect data when a consumer consents?
    • Consumers don’t understand terms and conditions – the FTC thinks it’s borderline absurd to think that they do.
  • Disclaimers should be written with the same panache as the ads themselves.
  • Terms need to be crystal clear.
  • Consumers don’t understand how online ads work.
  • FTC doing more research of “green” ads and hope to publish more guidelines soon regarding claim standards.
  • FTC is expecting to be partnering with the FDA more to regulate health and safety advertising.

I talked to another attendee of the session, Rebecca Madigan from the PMA, who said the session went on for about another 15 minutes after I just had to leave to get to my next speaking engagement on time.  I hope she posts more about the session somewhere!  Jeffrey, Peter, and David all had their own presentations, but the only one on SlideShare is Peter’s.  Here’s the presentation:

One Comment

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  1. Geno

    Excellent review, Trisha. I wasn’t able to attend this session. So, it is certainly good to see this post.