The Federal Trade Commission (“FTC”) is looking at you, influencers. In a new publication released on Tuesday, the government agency tasked with promoting consumer protection, and eliminating and preventing anticompetitive business practices provided very specific guidelines directed at influencers, reinforcing that these individuals – whether they are big-name celebrities and Instagram-famous figures or small-scale micro and nano-influencers – “have an obligation to stay on the right side of the law.”
In its latest publication, entitled, “Disclosures 101 for Social Media Influencers,” the FTC builds upon its existing guidance materials, asserting that when an influencer – which Merriam-Webster defines as an individual who “who inspires or guides the actions of others,” and who “is able to generate interest in something (such as a consumer product) by posting about it on social media – has “any financial, employment, personal, or family relationship with a brand,” that needs to be disclosed. The same is also true for any instance in which “a brand gives you free or discounted products or other perks and then you mention one of its products … even if you weren’t asked to mention that product.”
Aside from publishing explicit endorsement language promoting a brand and/or its products, which clearly gives rise to a need for disclosure, the FTC states that when an influencer “tags, likes, pins, [or makes use of other] similar ways of showing [that he/she] likes a brand or product” on any of the social media platforms, that also amounts to an endorsement, and must be disclosed as such. (Editorial note: I am not sure, from a practical standpoint, how the FTC expects disclosure when it comes to “likes.”)
In terms of disclosures, themselves, the government entity sets forth strict rules about what is proper, and maybe more importantly, what is not. For instance, disclosures need to be “clear and conspicuous,” which means that they “are likely to be missed if they appear only on an ‘About Me’ [or bio section] or profile page, at the end of posts or videos, or anywhere that requires a person to click ‘More.’” Beyond that, disclosure language that is “mixed into a group of hashtags or links” will likely be deemed improper, as will “vague or confusing terms like ‘sp,’ ‘spon,’ or ‘collab,’” along with “stand-alone terms like ‘thanks’ or ‘ambassador.”
The FTC suggests opting for “simple explanations like ‘Thanks to Acme brand for the free product,’” or terms, like “advertisement,” “ad,” and “sponsored.” In cases when space is limited, such as on Twitter, “the terms ‘AcmePartner’ or ‘Acme Ambassador’ (where Acme is the brand name) are also options.”
Addressing one of the most common examples of improper disclosure, the FTC states that influencers should not “assume that a platform’s disclosure tool is good enough,” and should “consider using it in addition to [their] own, proper disclosure.”
What might be the most striking of all of the points that the FTC makes in its new guidance is its attention to claims that require substantiation. Echoing its overarching requirement that advertisers have “a reasonable basis for advertising and marketing claims,” which means that “objective assertions about a product or service” must be “supported by competent and reliable scientific evidence,” the FTC states in its influencer guidance that “you can’t make up claims about a product that would require proof the advertiser doesn’t have, such as scientific proof that a product can treat a health condition.”
These types of claims are particularly significant in that they are precisely the kinds of endorsements that have routinely garnered attention not only from the FTC but also the U.S. Food and Drug Administration and the National Advertising Division, which cracked down on detox teas in 2017, among other entities. More than that though, this type of endorsement is proving to be a particularly relevant area given the rise in influencers promoting medications and health supplements, instances that stand to run afoul of the FTC Act if the influencers (or the companies behind the products) make claims that cannot be backed up.
Finally, the FTC cautions influencers against “talking about your experience with a product you haven’t tried,” which is prohibited, as is speaking positively “about a product [you used and] thought was terrible.”
The FTC’s newest guidance comes more than two years after the agency began to increase its attention to the $6.5 billion business that is influencer marketing, as indicated by the two rounds of letters it sent to brands, celebrities, and influencers for the purpose of alerting them to its disclosure requirements. While its influencer-specific info. might be little more than a routine educational effort, it could also indicate that the FTC is preparing to crack down on some of the sweeping numbers of undisclosed or improperly disclosed influencer endorsement posts, particularly given that it stated in connection with the publication that it is the “responsibility [of influencers] to make these disclosures, to be familiar with the Endorsement Guides, and to comply with laws against deceptive ads.”
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