Posts Tagged: FTC

Opening Day Edition: Beer Advertising and Sports

Today (March 29) is baseball’s opening day and beer and baseball are in the news.  The New York Yankees appear to be in trouble for their new “Pinstripe Pilsner” which has an image of your favorite Yankee player in the foam.  But those of you wanting to take a sip of Aaron Judge’s mug may have to wait, since MLB does not allow current players on beer advertising.

Beer has been linked with baseball for as long as baseball has existed.  In fact, the original Cincinnati Redstockings left the National League in 1881 when its brewer-owner refused to sign a “no beer at the ballpark” pledge.  Today, there are still calls to take the suds out of sports.  But knowing the current do’s and don’ts of sports advertising will help you stay a-head of the game. (more…)

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FTC 2017: Consumer Protection Year in Review (aka. If you do it, we’ll catch you)

The FTC put out its consumer protection year in review providing a comprehensive list of significant consumer protection developments in 2017.  Let us indulge you with a recap of a few illustrative actions affecting the promotion world.

“Free” Samples

In October 2017, the FTC charged A1 Janitorial Supply Corp. with deceptively calling businesses offering a “free” sample of its cleaning products and then billing them for the samples after shipping.  Hoping that one hand wouldn’t wash the other, the company shipped the goods to one employee (who received the telephone call) but then sent the invoice to another employee.  The FTC alleged that this practice violated the Telemarketing Sales Rule, 16 CFR Part 310 and the Unordered Merchandise Statute, 39 U.S.C. § 3009.  A TRO was entered and the case is still pending.

The lesson:  To stay squeaky clean, remember free means free even when it’s B2B. (more…)

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How About Some Updates?

You may or may not have heard of some recent developments in the promotion world.  If you haven’t, great, let me be the first to tell you.  If you have, my update is better.

Endorsements/Influencers

Back in the 1940s, a sociologist named Paul Lazerfield introduced the psychology behind the efficacy of influencers with his theory called “two-step flow of communication,” finding that ideas flow from mass media to “opinion leaders” who distill and pass along information to “opinion followers” with more limited knowledge. Today, this two-step “flow” of communication has become a deluge.  As a result, the FTC and social media sites are taking pains to corral it.

Instagram posted in June a “Why Transparency Matters” blog introducing its upcoming “Paid partnership with” tag for posts and stories.  Is it required?  We don’t know.  Instagram promises to release an official policy on enforcement “in the upcoming months.” (more…)

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2016: The Year in Review

In case you missed it, here are some notable items from 2016 concerning sweepstakes, contests, and related promotional matters:

Influencers, Native Advertising, and Endorsements

2016 kicked off with reaction to the FTC’s new Native Advertising Rules which seek more transparency in sponsored stories/advertising.

In March, in its first enforcement action, the FTC cracked down on Lord & Taylor for paying “influencers” to attract social media attention to its Paisley Asymmetrical Dress.  The FTC issued a number of directives, including making the influencers aware of their participation, and making disclosure of the relationship unavoidable.

In May, the National Advertising Division (NAD), a self-regulatory industry, issued a decision concerning native advertising appearing in People.com under the “Stuff We Love” section.  The NAD determined that disclosure of the sponsorship must be made before you get to the stuff page.

In July, the FTC charged Warner Bros. with making inadequate disclosures in videos of influencers playing a new video game.  The FTC didn’t like that the sponsorship disclosure was in a collapsed box below the video and needed to be in a place where consumers will find it.

In October, in an effort to comply with the FTC Rule, YouTube introduced a new feature allowing visible text on a video for the first few seconds with the label stating “Includes paid promotion”

The take:  Consumers and the FTC don’t particularly like “influencers” or hidden ads, so be conspicuous. (more…)

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Is It Really “The Best [Insert Product] You Ever Bought?” Amazon Limits Incentivized Reviews

When shopping online, we all want to know what lawnmower/backscratcher/egg timer is the best. Once we’ve found an array of options, many of us go right to the online reviews to see how others liked the product. Caveat emptor be damned, Ralph from Bensonhurst just loved the Handy Housewife Helper, so I want one too. Little did we know that Ralph and his partner Ed were trying to unload 2,000 of these gadgets to the unsuspecting public.

To help bolster the legitimacy of online reviews, yesterday (October 3, 2016) Amazon announced an Update on Consumer Reviews explaining that it has updated its community guidelines to prohibit incentivized reviews unless they are facilitated through the Amazon Vine program. (more…)

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There’s No Such Thing as a “Free” Sample: FTC Provides Guidance on Advertising “Free” Samples Combined with Recurring Charges

On Tuesday (September 20, 2016), the FTC and Nutraclick entered into a consent order concerning Nutraclick’s online offer for “free” samples of supplements and beauty products. The FTC alleged that Nutraclick failed to clearly disclose to people who requested the samples that they would be enrolled in a membership program and billed up to $79.99 per month, unless they canceled within an 18-day trial period. While this promotional offer may have netted significant profits, its success was short-lived when at least 70,000 filed complaints prompting the FTC investigation.

The FTC alleged violations of the FTC Act’s prohibition against unfair or deceptive acts or practices (15 U.S.C. §45(a)) and the Restore Online Shoppers’ Confidence Act, which pertains to selling online through a negative option feature, i.e., where a consumer’s silence is interpreted as an acceptance of the offer. 15 U.S.C. §8403.

The Promotion (According to the FTC Complaint): (more…)

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