In an article targets to manufacturers Ad Age warns that if they are are thinking about letting a big-name blogger test-drive a new hybrid in the hope of a glowing review, or maybe sending some beverage products to an influencer, hoping she'll spread the word think again?
The Federal Trade Commission is toying with a proposed plan to start regulating viral marketing and blogs.
As part of its review of its advertising guidelines, the FTC is proposing that word-of-mouth marketers and bloggers, as well as people on social-media sites such as Facebook, be held liable for any false statements they make about a product they're promoting, along with the product's marketer. This could present a significant issue for marketers, including the likes of Microsoft, Ford and Pepsi, who spend billions on word-of-mouth and social media. PQ Media projects that marketers will spend $3.7 billion on word-of-mouth marketing in 2011.
Rich Cleland, assistant director of the FTC's advertising-practices division, said the commission is updating the guidelines to stay in step with evolving marketing practices.
The FTC guidelines apply only to bloggers and others compensated to promote or review a product. Roberta Jacobs-Meadway, a partner at Eckert Seamans Cherin & Mellott, a Pittsburgh law firm, said: "The FTC is ... putting out guidelines to make it clear to people who are involved in social media and viral marketing that the same rules apply in this context as they do in the more formal context of paid advertising and infomercials." There are no legal implications for social-media sites such as Facebook or marketer sites such as Amazon, where consumers often post product reviews. However, Ms. Jacobs-Meadway said, paid endorsers who post on those sites can be held liable if they do not identify themselves as such.
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