Transcript Internet Advertising - affiliate.com online marketing compliance

FTC 101
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Federal Trade Commission (FTC) created in
1914
Aims to prevent unfair methods of
competition in commerce, unfair or deceptive
acts or practices
Enacts industry-wide trade regulation rules
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Enforces Federal truth-in-advertising laws
and focuses on:
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Claims for foods, drugs, dietary supplements
Weight-loss advertising
Advertising and Marketing directed to children
Tobacco and alcohol advertising
Protecting children’s privacy online
Claims about product performance made on the
Internet
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Investigations of
violations of
consumer protection
laws relating to ecommerce and the
Internet
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Consent Order with
the company
Administrative
Complaint or seeks
injunctive relief in
the federal courts.
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Potentially, EVERYONE!
The FTC considers everyone in the chain of
advertising liable
Advertisers
Affiliate
Networks
Liability ?
Affiliates
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ValueClick (2/08)
◦ $2.9 million penalty
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Adteractive (11/07)
◦ $650,000 penalty
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Ads must be truthful
and non-deceptive
Evidence to back-up
ad claims; and
Ads cannot be unfair
Source: FTC Frequently Asked Advertising Questions:
A Guide for Small Business
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Would your grandmother be misled by the
ad?
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Hoodia: Sili Neutraceuticals (2/08)
◦ $5.9 million dollar fine for falsely advertising weight loss
products
◦ Claims of 40 lbs. lost in a month
◦ Reverses aging process
◦ “Scientific Evidence” for weight loss
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eDebitPay (1/08)
◦ Prepay debit card advertiser engaged in deceptive
marketing by failing to disclose terms and fees – hidden
costs
◦ Over $2.2 Million in penalties
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Ohio Plaintiff’s interpretation:
◦ Font Size – Terms and Conditions must be at least
half as large as the word “free”
◦ Proximity – Terms should appear in close proximity
to the word “free”
◦ No Asterisk – Footnote with use of an asterisk or
other symbol is not adequate disclosure
◦ NOTE: OHIO GIVES GREAT WEIGHT TO FTC RULINGS
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Disclaimers must be CLEAR and
CONSPICUOUS
rominence……big enough?
resentation……easy to understand?
lacement……visual connection?
roximity……close to claim?
Lesley Fair: Bureau of Consumer Protection, FTC
rominence
◦ Is the dislaimer noticeable enough to read?
 Font Size – Size does matter!
 Color and Contrast – Fade away Font
 Use hyperlink styles consistently within an ad (Don’t
hide the link)
resentation
◦ Is the wording and format easy to understand?
 “Click Here for terms”
 “See below for important information on diamond
weights”
 “See below for details”
lacement
◦ Is it where consumers will look?
roximity
◦ Is it close to the claim qualified?
◦ Place the disclaimer or hyperlink near relevant
information and make it noticeable
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Don’t be subtle.
Asterisks or other
symbols by themselves
are discouraged and
may not be effective.
Typically, they provide
no clues about why
the claim is qualified
or the nature of the
disclosure.
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Website must have clickable
link to a Privacy Policy
Strict compliance with the
Privacy Policy
The fact that “the
competition is doing it”
does not make it right
Awareness of current
Federal and State laws and
regulations