Online Profit Marketing » FTC

Internet Marketing Law and Law Blog Changes

Nancy Nikolauson — Sat, 31 Oct 2009 15:41:32 +0000

You asked for more information on the New Law Internet FTC guidelines which will AFFECT Testimonial Advertisements, Bloggers, and Celebrity Endorsements and consequently all affiliate marketers working online.

Go here to read the complete ruling on blogging law, Internet Marketing Law use of testimonials which takes effect on December 01, 2009

The U.S. Federal Trade Commission released their new guidelines (law) on
10/05/2009. FTC has now Publishes Final Guides Governing Endorsements, Testimonials these Changes Affect Testimonial Advertisements, Bloggers, and Celebrity Endorsements You will find the complete guidelines at
http://www.ftc.gov/opa/2009/10/endortest.shtm.

The notice incorporates several changes to the FTC’s Guides (law Internet) Concerning the Use of Endorsements and Testimonials in Advertising, which address endorsements by consumers, experts, organizations, and celebrities, as well as the disclosure of important connections between advertisers and endorsers.

As the FTC changes are a long read, I will try to summarize the main points of this recently updated Internet Marketing law.

First if you have a relationship with someone whose product you are
endorsing or promoting, you must disclose that relationship. That means you have to say explicitly if you received any type of compensation wither it is a free copy of the product and/or any payment or gift for your endorsement.

If you use testimonials to sell a product on your website, blog, or even someone Else’s site, for instance a sales page?, you can not use testimonials that give specific results without also telling readers/viewers what the typical results are.

If you or the product owner do not have proof, or know the actual percentages do not make assumptions or use testimonies from one or more people having great results. For instance the FTC law wants to see the normal results of people making money and how much, or how much weight the average person looses using a product not the outstanding ones, etc.

The fine is $11,000 per violation.

Do not forget about sites you have had up for some time, go back and correct them now.

I strongly recommend that you read the details in the guidelines (law internet, but these are the key points. I’m no lawyer, so do get true legal advice from a lawyer so you can figuring out how you need to respond to the new regulations.

It seems to me that some parts of the new guidelines are vague. The U.S. Federal Trade Commission says they have done this somewhat on purpose, and that they will be handling things on a
case by case basis.

That will make it more difficult to know how to comply in certain
situations, because it is hard to figure out how the guidelines really
apply, but that’s the way they did it.

That leaves a number of unresolved questions, the answers will not be available until the FTC starts enforcing the new regulations.

The U.S. Federal Trade Commission said that the guidelines are meant to clarify advertising on blogs and for corporations, however the way these regulations (laws) are written
they could go after just about any marketer due to the vague
language.

The new Internet marketing regulations were approved by a unanimous vote (4-0), so there is virtually no chance that
they will not go into effect on the scheduled date. There is an out cry by Internet Marketers and lawyers have been hired however at this time you as an Internet Marketer, Blogger will have to live with this ruling whether we like it or not.

For Internet marketers with businesses outside the U.S.?

If you are outside the U.S. and you are not selling to people inside
the U.S., you are not affected at all.

However most Internet businesses do sell to people in the
U.S. So be safe and assume that folks in the United States will
buy your products, and that you should follow the FTC guidelines.

What about testimonials on a sales page?

The testimonials on sales pages that say things
like, “I made $10,000 the first 3 days with just one tip from this great product!!!” You more than likely will not be seeing them.

It has been perfectly acceptable to cherry-pick great results
like that and cover yourself with a simple disclaimer like this:
“These results aren’t typical.” Not anymore.

The new FTC guidelines say, “advertisements that feature a consumer and convey his or her experience with a product or service as typical when that is not the case will be required to clearly disclose the results that consumers can generally expect.”

That means if you want to mention specific results in your advertisement testimonials, you will have to give the typical results from the use of the product.

We all know what the typical results are for most information
products… people buy them and do nothing with them. That means
it is going to be nearly impossible for you to quantify a “typical” result. If you don’t know what results at least a statistically significant sample of buyers got, you can say what’s typical!

All of that means is you really can not use most
results-based testimonials. Period. Unless you want to risk an
$11,000 fine each time you get caught breaking this law.

You will be able to use testimonials where people say they love your
product, or like you a lot, or generally think you are a great person. However this type of indorsment tends not to be a powerful selling tool, but it will pass.

You will also have to disclose if your friends wrote your testimonials.
Be Honest it is the best way not to get in trouble.

The best advice do not depend on testimonials to sell your
product. Make sure your offer is good enough to sell on its own so you will not need one.

Celebrity endorsers also are addressed in the revised Guides. The revised FTC Guides reflect Commission case law and clearly state that both advertisers and endorsers may be liable for false or unsubstantiated claims made in an endorsement – or for failure to disclose material connections between the advertiser and endorsers. The revised Guides (laws Internet) also make it clear that celebrities have a duty to disclose their relationships with advertisers when making endorsements outside the context of traditional ads, such as on talk shows or in social media.

If you are an affiliate, you will have to disclose that you are getting
paid when people buy through your affiliate link.

You will need to tell people that your ClickBank link is
indeed a ClickBank link, even if you have your own
“www.mysite. com/product” or whatever.

There are different statements you might use to comply with this ruling. The first way is to include a statement on your site or possibly include it in your privacy policy that states something like this:

“Links on this site for products or reviews are affiliate links. I/company gets paid a commission when you buy a product after clicking on one of these links.”

You might also say something like, “I get paid a commission when you buy through this link.”

or something like “when you click on this links you will be taken to company XXX sales page (they pay me a commishion for sales)

Do these disclaimers cover you legally? Hard to say, the FTC
has not cleared that up yet.

Finally, as an affiliate marketer be VERY careful about using the
promotional materials and email templates produced by sellers make sure they pass the guide lines, laws and Internet requirements

Frequently these promotional materials and email templates contain claims about results, and the new FTC guidelines frown on that unless typical results are given.

The new FTC guidelines dos not at this time cover e-mail marketing by it’s self however remember the vaige language of this bill the odds are good this will be considered covered as well. So if you are in doubt, I recommend you leave it out or back it up!

Get knowledgeable genuine legal advice from a lawyer that understands this stuff, especially if you have a big site, lots of traffic, and particularly if you are blogging and/or have a large mailing list.

Affiliate marketer, get busy adding disclosures to the
sites you use to promote products. That includes blogs, review
pages, and I would also go through my websites.

Definitely add a disclosure to your site saying that your
promotional links are affiliate links, and that you get paid when
people buy through those links.

Do not forget to tell buyers that you get paid for their response to free items, even putting in their email address, bonuses or what ever you can think of do not hide anything is my advise if you are getting paid.

When in doubt, disclose, disclose, disclose give more
information than you think you need. It will not pay to get on
the wrong side of this new Internet marketing law, ruling, on Blogging and Endorsements.

If you are a product marketer, you probably have lots of work to do.
Here is a very brief (and probably incomplete) checklist:

First start scrubbing your results-based testimonials from your sales
pages. If you actually CAN quantify typical/average results, go
ahead and do that, however if you do not have proof do not do it. In fact,during the comment period on the rules, some folks brought that up with the FTC, specifically for weight loss products…and the FTC promptly ignored it.

Make sure you change your affiliate email templates (and other things, like solo ads) to remove any unsubstanciated results claims.

Make sure your affiliates know to change to your new ad pages, e-mails, ect.

Make sure you crub your products of any results claims as well, unless they are your personal results and if they are include ALL of your results.

If your testimonials are from people you gave a free copy of
your product to, say so.

Bottom line, disclose, disclose, disclose!

These new guidelines (laws) are not the death of Blogging, Internet
marketing, or of affiliate marketing, or if you are selling a product on the Internet.

Please do not try to figure out a way around this new ruling do realize these are actually Internet laws taking the risk of racking up some eye-popping fines, just take some reasonable steps to comply with the new guidelines as soon as you can… and as completely as you can.

One thing these new guidelines are going to make happen is
it is going to be a lot harder for people to sell with hype and false promises. Those type of fraudulent sellers have and do only hurt everybody by giving Internet marketing a bad name.

The Internet marketer who can be completely honest will still make money and we will not have to compete against the frauds like we have in the past.

To Your Financial Success

FTC Ruling AND IT’s Effect ON Blogging

Nancy Nikolauson — Wed, 07 Oct 2009 07:01:39 +0000

I’m sharing this blog post by Frank Kern.

Frank Kern on the new FTC regulations

http://masscontrolsite.com/blog

I think he has done a good job addressing this new ruling on the part of the FDA and it’s effect on Internet marketing and blog posting. I addressed this subject in an earlier post before the ruling became law, so here it is.

New FTC Thing Is A Bigger Deal Than You Might Think

6 Oct, 2009 Uncategorized

FTC Declares Shenanigans On All Kinds Of Stuff!

OK. Before we begin, let me make the following disclaimer: I AM NOT A LAWYER, NONE OF THIS SHOULD BE CONSIDERED LEGAL ADVICE.

(Duh!)

Onward…

Most people think the new FTC guidelines are aimed at stopping those fake blog sites.

You know the ones, right? Where the “blogger” is a totally non existent person and it’s just some made up story to promote a CPA offer?

I’m sure you’ve seen them.

Here’s a list of fake weight loss blogs

http://www.weightlossweapons.com/blog/weight-loss-scam-sites/

…And here’s a list of fake “Make Money” blogs:

http://workathometruth.com/classifieds/m-fake-mon/

And while I’m sure these fake blogs played a major role in the FTC ruling, all those people telling you that this is all about blogs …

ARE WRONG.

Here’s the deal:

First, if you’re getting paid to sell something on a blog, yeah, you should go ahead and let people know. Maybe mention it in the TOS, or maybe say something like, “If you decide to get this thing, click this link first and they’ll pay me a little commission money so I can finally retire to that little fishing village in Mexico!” (<—Like I said, this is not legal advice! Get advice on this from a real lawyer and NOT me.)

Personally, I don’t think the whole “blog thing” is that big of a deal for REAL marketers like us and I think it’ll be super easy to comply with the FTC.

BUT HERE’S WHAT THEY’RE NOT TELLING YOU.

These new guidelines are a whole lot more serious than this blog business.

They also cover how you can use testimonials …and this is likely to PERMANENTLY change the way we do business.

Here’s the interpretation straight from my FTC lawyer, Gary:

“…The most significant change to the revised guides is the deletion of the “safe harbor” that has long allowed advertisers to use testimonials who reported specific successful experiences with an advertised product or service as long as the advertiser included a disclaimer such as “Results not typical.” Under the revised Guides, advertisements that feature a consumer and convey his or her experience with a product or service as typical when that is not the case will be required to clearly disclose the results that consumers can generally expect.”

Umm …right. Here’s the “Kern Translation”:

Let’s say you sell an exercise DVD.

And let’s say you’ve got a customer …we’ll call her “Patsy” …let’s say Patsy followed your DVD to the letter, worked out like crazy, watched what she ate, and lost 950 pounds.

Now, let’s say Patsy wrote you a testimonial and said “I lost 950 pounds thanks to this DVD!”.

Nothing weird there, right?

Up until these guidelines came out, you could be really safe by simply putting the standard “results not typical” disclaimer on your site. You’ve seen it 100 times, right?

It goes something like this: “Results not typical. Your results may vary.”

No big deal …up until now.

Here’s the key phrase form the “official” paragraph above:

required to clearly disclose the results that consumers can generally expect.

What this means is that if you have a testimonial where someone gets an amazing result using your product, you’ve got to follow it up by saying something like this:

Results not typical. The average user uses this DVD as a coaster for their Big Gulp and never loses any weight at all.

And frankly, even doing that might be dangerous if you say “the average user uses this DVD as a coaster” because the FTC could theoretically argue that …well, you’re implying that therefore all anyone has to do is NOT use the DVD as a coaster and they’ll lose 950 pounds.

See? Easy to screw that one up.

Here’s more from my man Gary: “The FTC also said that it believes that it is “likely” that testimonials that present the specific experiences of a product user (e.g., the number of pounds or inches lost) will be viewed as claiming that those experiences are typical of what consumers will generally experience.”

Mmm hmm. Trouble with a capitol “T” right there, buddy.

Here’s the sentence that get’s you: viewed as claiming that those experiences are typical of what consumers will generally experience

In my opinion, this means that if you say Pasty lost 950 pounds, the FTC will view this as you saying the TYPICAL USER will lose 950 pounds.

And if you don’t have documented proof out the wazoo showing that the typical user loses 950 pounds, you’re hosed.

Here’s what this means to you

OK. Basically, if you use a testimonial that shows someone really hitting it out of the park, you can’t say “results not typical”.

You gotta say something like “Results not typical. The average user experiences XYZ.”

And if you don’t know what the average user’s results are, you’d either better find out …or simply not use these types of testimonials at all.

But this doesn’t mean that ALL testimonials are this serious. From what I understand, you don’t have to worry about any disclaimers if you’re using testimonials where your customers simply say they like your product, like you, and are happy with their purchase.

…It’s only when you’re conveying a specific result.

Here’s my advice

COMPLY, BY GOD!!

Look. Many marketers are going to scheme for days on how to “get around” this new ruling.

Don’t waste your time. You don’t “get around” the FTC. If you’re worried that a certain testimonial will get you in trouble, don’t use it.

In my experience, testimonials are overrated anyway.

My Mass Control sales video didn’t have any (but I did use them in pre-launch. I won’t do that any more.)

And our current “Screw Google” promotion doesn’t have any either.

If you deliver enough value BEFORE asking for the sale, you should be able to sell plenty of stuff forever.

We’re SUPER lucky as Internet Marketers because when you build a list, you can constantly be providing great value for your subscribers for free …and when it’s time for you to sell something, they don’t need too much convincing.

Anyway – that’s my take on this whole FTC thing.

Hopefully, it clears things up for you and will help you keep your nose clean!

Frank

P.S. I almost forgot to make this point. Any time you have a major change in marketing like this, you’ll see a big drop off in competition.

Lots of people will either screw themselves by not complying with the new regulations, or they’ll try to comply but fail to sell anything because they’re not delivering enough up-front value. Or they’ll just say, “aww …to hell with it” and quit.

All three of these scenarios do nothing but clear the way for you to get more customers by eliminating your competition.

Selling stuff is easy. All you gotta do is give away stuff that makes people happy …and then sell stuff that makes ‘em even happier.

No over-the-top testimonials needed

Now get out there and make some money!

*** If you enjoyed reading this blog, your results are not typical. The average reader eventually says to himself, “Shit. I shoulda just watched Family Guy or something.” Absolutely nothing in this post should beconsidered legal or professional advice. Seek the care and advice of a normal and sane person.

—————————————————————————————

I hope this has been of help do follow the new rules for your financial success.

The FTC Is Going To Regulate Blogging

Nancy Nikolauson — Fri, 26 Jun 2009 04:48:45 +0000

The Federal Trade Commission ( FTC ) Is Getting involved in internet
blogging. The commishion is expected to approve the blogging guide lines
late this summer of 2009. Included in these guide lines with possible
modification will be the abbility to investigate bloggers as well as the
companies that pay them or offer some other perk for indorsments. It is
the FTC’s belief that bloggers who are compansated for blogging
indorsments are missleading consumers. They point out that people go
online to get reviews of products and services befor purchasing them beleiving these reports.

It is the belief of this committee that these reports are tainted. The Federal Trade Commission pointed out that in other medias Journalist who work for broadcasters, newspapers and others are usually not allowed to be compensated by the companies they are writing about or their marketers. They say the consumers frequently do not relise that bloggers are paid by linking to products, or receiving perks including gift cards, trips, or free laptops or even direct payment for articles that endorse the merchant, so they have decided to set guidelines.

They state that bloggers frequently do not disclose this to the buyer and that this practice is misleading. So they want the ability to go after the bloggers who endorse products for compensation as well as the companies that support them. This will be a first for the regulation and the patrolling of what bloggers say and do on the internet,and in Internet Marketing.
The way it is now being put together the common practice of even putting
a link to a retailer and receiving a commishion would be enough to trigger
a FTC oversight investigation.
These statement where made by Richard Cleland Assistant Director or the
FTC’s division of advertising practices.

“IF you walk int a department store,you know the (sales) clerk is a clerk”,” Online, if you think that somebody is providing you with independent advice and …they have an economic motive for what they’re saying that’s information a consumer should know.”
They believe these guideines will bring about uniformity to the blogging
community. The FTC believes that bloggers are a type of community journalism
without the ethical practices typically found in traditonal media.

This regulation if passed will be make it interesting to say the least.
The freedom we now have as bloggers will be lost.
How will any type of compansation be made considering bloggers are not
employees.
Will blogging as a sales media even be able to exist?
Yes the truth about a poduct and even its weaknesses should be told, and
if it is bad do not support it.
However should Blogging be regulated to this extent?
They state that bloggers frequently do not disclose this to the buyer and

that this pracice is missleading. So they want the ability to go after the

bloggers and the companies that support them. This will be a first for the

regulation and the patrolling of what bloggers say and do on the internet.
The way it is now being put together the common practice of even putting

a link to a retailer and receiving a commishion would be enough to trigger

a FTC oversight investigation.
These statement where made by Richard Cleland Assistant Director or the

FTC’s division of advertising practices.”IF you walk int a department store,

you know the (sales) clerk is a clerk”,” Online, if you think that somebody

is providing you with independent advice and …they have an economic

motive for what they’re saying that’s information a consumer should

know.”
They believe these guideines will bring about uniformity to the blogging
community. They believe bloggers are a type of community journalism

without the ethical practices typically found in traditonal media.
This regulation if passed will be make it interesting to say the least.
The freedom we now have as bloggers will be lost.
How will any type of compansation be made considering bloggers are not

employees.
Will blogging as a sales media even be able to exist?
Yes the truth about a poduct and even its weaknesses should be told, and

if it is bad do’nt support it.
However should Blogging be regulated to this extent?