FTC Guidance for Social Media Influencers and Endorsements Continues to EvolveNovember 2019
On November 5, 2019, the FTC released its new guide titled "Disclosures 101 for Social Media Influencers" (the "Guide"), along with an accompanying video, to provide additional guidance for the ever-growing number of people using their social media presence to promote and recommend products and brands. While the Guide does not create new rules, it highlights the FTC’s significant concern that required disclosures relating to "material connections" with those products and brands are not being made when necessary or in a manner sufficiently conspicuous.
The Guide serves as a supplement to explain existing principles from the FTC’s Endorsement Guides. The Guide also includes recommended strategies for new social media functionalities and practical guidance drawn from FTC enforcement actions relating to influencers and truth-in-advertising on social media platforms.
When to Disclose
The Guide reiterates that a person who endorses a product through social media must conspicuously disclose any “material connection” she has with the brand. A “material connection” to the brand includes any personal, family, or employment relationship or financial relationship.
The FTC wants influencers to err on the side of disclosure. The Guide points out that financial relationships are not limited to monetary consideration and that an influencer should disclose a relationship if she gets anything of value in order to mention a product. Additionally, the FTC advises that if a brand gives an influencer free or discounted products and then the influencer mentions one of its products, the influencer should make a disclosure even if she was not asked to mention that product.
The Guide recognizes that an influencer does not need to make a disclosure if she has no brand relationship and is just telling people about a product she bought and happens to like. But the Guide states that influencers (and companies) should be clear about whether there is a brand relationship, keeping in mind that the FTC's definition of endorsement even includes tags, likes, pins, and other simple acts of showing that an influencer likes a brand or product.
How to Disclose
Most of the Guide focuses on how disclosures should be made. The Guide encourages influencers to place a disclosure “so it’s hard to miss” and in close proximity to the endorsement message to which it relates. To illustrate, the Guide notes that disclosures are likely to be missed if they appear only on an “About Me” or social media profile page, at the end of posts or videos, or anywhere that requires a viewer to click “More.”
The FTC also advises that influencers should not mix a disclosure into a group of hashtags or links. The FTC also made this point in a recent blog post and in four warning letters issued earlier this year. In that blog post, the FTC explains that “another consideration in social media is hashtag overload—multiple tags or links that readers may just skip over #especially #at #the #end #of #a #long #post. It’s unlikely that hashtags displayed that way meet the ‘clear and conspicuous’ standard [for disclosure].”
Although many of these practices have been a common form of disclosure by social media influencers in recent years, the Guide emphasizes that they should be avoided. The Guide reiterates that companies that use social media influencers for advertising must ensure that their influencers are placing the advertising/sponsorship disclosure at the beginning of the post or in a way that is noticeable and not hidden among a series of hashtags.
The Guide includes examples of how to make appropriate disclosures on certain social media platforms. For example, for endorsements in a picture on a platform like Snapchat or Instagram Stories, influencers should superimpose the disclosure over the picture and make sure that viewers have enough time to notice and read it. For an endorsement made in a video, the disclosure should be in both the video and the description uploaded with the video. If an influencer makes an endorsement in a live stream through platforms like Facebook or Instagram, the disclosure should be repeated periodically so that viewers who see only part of the stream can still see the disclosure. The Guide warns that influencers should not assume that a platform’s disclosure tool is enough.
Although the Guide emphasizes that it is an influencer’s responsibility to make appropriate disclosures in compliance with the Endorsement Guides, the advertising company that retains an influencer also has the responsibility to comply with the Endorsement Guides. As such, these companies can face enforcement actions from the FTC. In fact, the FTC’s enforcement focus so far has been on advertisers, ad agencies, public relations firms, and other companies in this industry. For example, last month the FTC settled charges with a company that sold fake followers to influencers and celebrities. The FTC alleged that the company sold more than 58,000 Twitter followers, 4,000 YouTube subscribers, 32,000 YouTube views, and 800 LinkedIn followers. The FTC stated that by selling fake indicators of social media influence, the company provided its customers with the means and instrumentalities to commit deceptive acts or practices. However, it has not brought any enforcement action against influencers or customers of the company.
Simply telling influencers the dos and don’ts is not sufficient to shield companies from FTC enforcement. Companies should monitor compliance and take action to address influencers who do not comply. Additionally, companies should be careful to refrain from re-posting an influencer post that does not contain appropriate disclosures. If you need assistance complying with the Guide or Endorsement Guides or otherwise crafting guidance for endorsements and influencers, please contact one of our Advertising, Promotions & Social Media attorneys.