FTC Disclosure Rules and Digital Marketing’s On-Going Struggle | Koeppel Direct

FTC Disclosure Rules and Digital Marketing’s On-Going Struggle

FTC Disclosure Rule-Digital Marketing

It’s no secret that it’s really been a struggle for marketers to reach target audiences made up of ever-elusive cord-cutters and ad-blockers.

Endorsements, while not a novel approach, seem to be making a huge comeback on social media channels. As of now, Instagram alone has had over 200,000 individual posts a month tagged with “#ad,” “#sp” or “#sponsored.” That’s just one of dozens of social media channels, which is why it’s more important than ever that the rules regarding proper disclosure of these types of advertisements be clarified by the Federal Trade Commission (FTC).

Currently, the FTC suggests adding “#ad” or “#sponsored” to the beginning of endorsements in social media, but there are no truly solid rules established for disclosure. According to Mary K. Engle, Associate Director for Advertising Practices at the FTC, “We’re not prescriptive about that, but it has to be unambiguous.” In an interview with the New York Times, she suggested that thanking a brand or using “#sp” or “#spon” would probably not be clear enough, but calling a brand a partner might be.

Growing Frustration, More Questions 

Even as brands are growing more concerned about the FTC’s ambiguity rule, social influencers are growing more frustrated with the requirements. Audiences are responding viscerally, by skipping known advertisements and spending less time interacting with influencers and brands.

Some complain, but others have simply gotten more clever. This summer, Jack in the Box sponsored YouTube star Miranda Sings’ moving original serenade, “Sexy Buttery Love Song,” a love song to a cheeseburger. Although it was openly disclosed as a sponsored piece of content, the video has already surpassed one million views.

Brands and marketers, however clever, are still calling for more clear guidelines for exactly how each type of media should display disclosures and where. For example, rules that were better spelled out might have saved the FTC the time required to settle charges against Warner Bros. over a campaign it ran with YouTube video game influencers. The necessary disclosure was made, but it wasn’t visible unless the user clicked the “Show More” button under the video, which the FTC argued led to confusion.

Establishing a playbook for digital media endorsements (and other types of advertisements) on social media apps and websites would expedite growth in what is still essentially the Wild West of marketing. Although the FTC seems hesitant to put pen to paper, some solid rules on disclosures and their placement could help to prevent a lot of future frustration in this area.



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