Disclosing sponsored content can seem like a bit of a minefield. The regulations are constantly updating, when they are updated they are not particularly well advertised and many creators working with brands often fail to realise exactly what constitutes sponsored content in the first place and therefore when in fact they have to disclose a collaboration.
Writing #ad at the end of your post doesn’t cut it anymore
This easy to understand guide aims to simplify the legal jargon and help you stay on the right side of the latest regulations. In this post, we’ll focus on sponsored content in the USA.
So who made the regulations anyway? In the USA sponsored social media content is overseen by the Federal Trade Commission, more commonly abbreviated to FTC. This governing body decides what content should be marked as sponsored and in what way, they can also bring legal action against you if the rules are not followed.
Most influencers are not following the rules. A recent study found that over 90 percent of top social media celebrities did not correctly disclose paid endorsements.
So why should you? The FTC is cracking down on social media advertising, and especially influencer marketing. There have been several high profile cases on note by the FTC against PewDiePie, TmarTn and Syndicate to name a few.
Now more than ever it is crucial to familiarise yourself with the guidelines to avoid getting into some serious (and potentially costly) trouble.
Who has to disclose
In the USA the obligation to disclose sponsored content is on the creator. The FTC can bring a case against you not only if you failed to disclose your sponsored content at all, but also if you failed to declare it in the correct way.
Brands are not exempt either. If brands do not ensure the creators they work with disclose the partnership, they are also liable for legal action – as department store Lord & Taylor found out the hard way when it was forced to settle an FTC action for not explicitly instructing its influencers to mark their collaborated content as paid for.
What do you have to disclose
In the simplest terms, whenever you work with brands to recommend or endorse a product you must disclose the partnership.
But what’s important to realise is that you still have to declare your relationship to the brand even if they are not paying you to talk about their product.
Namely, you have to disclose your relationship with the brand if they give you anything of value, whether it’s payment, free or discounted products, or any other perk – and if you get a ‘perk’ from a brand and end up recommending a completely different product of theirs, you still need to disclose your relationship to the brand in that recommendation.
If your recommendation is not influenced at all by the brand and you believe your endorsement is completely balanced, it is still essential you disclose the fact they have given you a ‘perk’.
Other kinds of relationships also need to be disclosed to be in line with FTC regulations, such as, employment relationships, personal relationships and family relationships.
Tags, likes, pins, etc., about a brand or product endorsement are also subject to disclosure regulations.
In fact, the only time you don’t have to declare a brand relationship is if there is none. For example, you bought a product from a brand you have never worked with and that has never given you a ‘perk’ and you happened to like it and recommend it on your channel. As the FTC puts it: “You don’t need to declare that you don’t have a brand relationship.”
An example where both creator and brand broke the law
The Electronic Code of Federal Regulations (e-CFR), another handy document for brands and creators looking to follow the regulations, offers an interesting example of how easy it is to fall foul of the law.
In this case a skin care brand approaches a blogger requesting she try their new body lotion and write a review on her blog. The brand does not make any claims about their product, or tell her what to write about it, and the blogger does not ask if any of her opinions about the product are scientifically proven.
In her review she writes the lotion cures eczema and recommends it for her readers who suffer from the condition.
Unfortunately, both the brand and the blogger just broke the law. Firstly the blogger and the brand are liable because she failed to disclose her relationship with the brand, which the brand should have advised her to disclose, especially if she had been paid in any way for the review (including a free product).
And secondly, both the blogger and the brand are liable because she made a claim in her recommendation – namely that the lotion cures eczema – that was not substantiated and therefore misleading.
In fact, making any claim that is unproven, giving a glowing recommendation for a product you are not really impressed with or talking about a product you have not tried yourself goes against the FTC regulations.
How do you disclose your brand relationship
So how should you disclose your sponsored content or brand relationship the right way? As said before, it is not enough to simply write #ad in the description of your post.
You have to make your disclosure message “hard to miss” and in practice this means placing it within your endorsement. It’s not enough to write it in the description, in a group of hashtags, on a separate page, or anywhere that requires another click from the viewer to see it.
If your endorsement is a picture, the disclosure must be superimposed on it and viewers must have enough time to read it. In a video, the disclosure must be both audio and visual. It should be superimposed on the video and read aloud by the creator. And in a live stream, the disclosure should appear periodically throughout the stream so viewers who only tune in for a portion of it are made aware.
When it comes to phrasing your disclosure, simple, clear language is key. Stick to terms like “advertisement”, “ad” and “sponsored”. An exemplar disclosure from the FTC guidelines is: “Thanks to X brand for the free product”.
Failure to follow the FTC regulations can result in fines, don’t risk it!
Advertising regulating bodies have influencers square in their sights, make sure you don’t get caught out by following this guide to disclosing your sponsored content correctly.