Before heading to a store or retail Web site, many shoppers love to check out the growing flurry of product reviews posted online. But figuring out who to trust in the blogosphere has gotten trickier as more and more bloggers get paid to promote products on their sites.
Companies see the freebies and payments to bloggers as a cheap way to boost brand buzz during the recession. But site visitors often don’t realize they’re reading a promotional pitch. Not all bloggers make clear that they are being compensated to talk up products, if they disclose it at all.
One popular “mommy blogger” promoted Wal-Mart, Ford and Electronic Arts after receiving significant freebies from the corporations. Ford provided the mom a new Flex crossover vehicle for a year and a gas card, she then described the vehicle as “love at first sight.” When quizzed about her bias, the mom admitted she never posted anything uncomplimentary about products she is asked to review because she “chooses not to be negative.”
But many bloggers are condemning the erosion of trust such activities create. A growing number of bloggers are speaking out about the need to be more up front with readers about arrangements with corporate America. Advocates of more disclosure argue that the credibility of their collective writings will suffer if readers cannot discern company shills from honest voices .
And now the Federal Trade Commission has issued new guidelines designed to set clearer rules for disclosure in social media influencer campaigns. The guidelines, approved in unanimous vote, state that bloggers who have received money or “in-kind payment” tied to product reviews must disclose such deals to readers. Companies that refer to a research group finding about a product must disclose any relationship with that organization. Violators face fines of up to $11,000 per infraction.
The new rules are the first update the FTC has made to its guide for testaments and endorsements in advertising since 1980. They bring into sharper focus the relationship of bloggers and brands. The FTC chose not to make a distinction between professional bloggers and amateurs. It also does not differentiate between paying cash and providing product samples.
Experts said the new regulations would have little impact on marketers following standard practices. The FTC said marketers and bloggers must follow the rules even if there is no requirement for a positive product review.
The updated guidelines also tighten the rules for celebrities, requiring them to disclose their relationships with advertisers when discussing a product in interviews or social media. Celebrities are now responsible for the claims being made.
The new guidelines were much anticipated following commission officials expressing the need to regulate the growing business of social-influencer programs. Companies regularly send bloggers products for review, and new businesses have sprung up to garner endorsements in social media channels like Twitter.