The Federal Trade Commission (“FTC”) is a governmental agency whose function is to help protect consumers and prevent unfair competition. As it relates to influencer marketing, the agency is charged with preventing deceptive and unfair marketing practices through law enforcement and advocacy. The agency issued their first guidelines for endorsements in social media in 2009 and continues to update the endorsement guidelines here.
Two the right is a compilation of some of the actions the FTC has taken to date against brands, agencies, and influencers.
A Closer Look with Three Big Brands
To say that Microsoft’s Xbox One has been an enormous success is a bit of an understatement. By January 2019, the video game console had sold more than 41 million units, and at a little more than $200 a pop, that’s a lot of dough and a clear sign of its popularity.
But for all of the Xbox One’s success, in 2015, a marketing campaign for the console encountered a roadblock when it ran up against the regulations of the Federal Trade Commission (FTC). Videos endorsing the Xbox One that influencers posted on YouTube were at the heart of the complaint when the FTC charged California-based Machinima, Inc. with engaging in deceptive advertising.
The Federal Trade Commission (FTC) doesn’t play around. That’s especially true when it comes to the consumer protection agency’s disclosure requirements for sponsored video game reviews on social media. This is what Burbank, California-based company Warner Bros. Home Entertainment learned in 2016. Warner Bros. has been in business since the 1920s and has long been at the forefront of the entertainment industry. But it was the FTC’s requirements for modern media that tripped up the company
Lord & Taylor
Native advertising, also known as advertorial, has long occupied a blurry space in print media. It creates the visual suggestion that an ad is editorial — it doesn’t appear as paid promotion unless you look at it a little more closely. You’ve probably seen these ads and possibly did a double take when you did.
These advertorials often run in travel or fashion magazines. They usually feature layouts similar to the style of the publications’ editorials. So, a quick glance at them might make you think they’re magazine articles too. However, they also include disclosures that say “advertorial” or something similar to alert readers to the fact that they’re really paid ads.