Home » Affiliate Marketing Blog » FTC plans to regulate bloggers – but what does it mean for me?!

FTC plans to regulate bloggers, but what does it mean for me?!

FTC plans to regulate bloggers, but what does it mean for me?!

A few months ago I wrote that the FTC were considering regulating bloggers who make paid endorsements or false statements and affiliates disclosing their links. Now that it looks like this is going to happen, you're probably asking yourself; what does it actually mean? How will I have to change my affiliate site? And will I one day get a fine in the mail for promoting an affiliate program without disclosure? I've read many blogs on the subject and skimmed the 84-page document from the FTC (which you can download here), and I've tried to summarize what it means. But first my own little disclaimer: I'm not a lawyer and I don't live in the US so I don't come under FTC regulation. This is my best interpretation of what the law means, but you should be sure to do your own research to make informed decisions for your business.


Warning: Individual Results May Vary

We've all seen these words in tiny text at the bottom of infomercials for years, and provided you have the 20/20 vision required to see it, it basically tells you that the super-model-slim woman talking on the ad about how she lost 200 pounds is a 'best case scenario' and you shouldn't expect to have the same thing happen to you. The idea is that if you're a company and you're using one of your customers as a testimonial, people reading or watching the ad must be able to reasonably expect that they will achieve the same results with your product. If not, you have to tell them.

It's the same idea when it comes to endorsements. Can you reasonably expect the person watching or reading to know that the endorser is paid for their comments and that the comments may not actually be their own opinions? In the case of celebrity endorsements, the answer is typically yes. When you see Tiger Woods talking about how the Gillette Fusion gives him the closest shave ever, most people realize that they guy got paid for it, and probably got a free supply of razors to boot.

But what about when a celebrity is being interviewed on a car show about the car they drive? They might say that they drive a Toyota Prius because it's really good for the environment. But what if Toyota actually gave them the car for free? And if you knew that, would if affect your perception of that celebrity's endorsement? Maybe yes, maybe no. But the bottom line is, the celebrity should probably say that they got the car for free to avoid any complication.

So what about blogs, new media and word of mouth marketing? Because the regulation and the guidelines that define how the law is to be enforced were written before any of these things were around, it's no surprise that these forms of media have got a free pass until now when it comes to disclosure. But that's about to change.

The FTC's opinion is basically this – people go online to look for unbiased information on products and services so they can make informed buying decisions. If they come to a blog where the blogger writes a positive review or endorsement of a product, they're probably more likely to buy it. The problem is that the blogger may have got the product for free, or have received payment for writing about it, or, in the situation that concerns us most, be an affiliate for that product and get a commission on referred sales. While these factors obviously affect the impartiality of a website, the reader may not know the difference. That's why the FTC will be refining the guidelines. This is not actually new law, but rather they are defining how the existing law applies to a new medium.

In the affiliate world there seems to be two camps. There are those who see this as an awful infringement of free speech and envisage the big bad Feds knocking on the door of a 15 year old blogger who happened to put an iTunes affiliate link to a song he liked. Then there are those who think this will only affect scammers, and legitimate affiliates shouldn't really be affected. Some even think that this law will go a long way to improving the level of trust that people have for what they read online. If you are completely upfront about your connections to the product, you could actually turn disclosure into a selling point.

I tend to agree with the latter. If you are promoting a product, there is really no reason why you shouldn't honestly admit that you are an affiliate for the product. At the end of the day, if you are providing enough valuable content to your readers as well as great information on products, then they will still likely buy through you. And as a bonus, your credibility goes through the roof.

The FTC is not actually the big bad wolf it's often made out to be – it is actually trying to protect consumers from being deceived as well as make a level playing field for marketers. And don't worry, you're not going to suddenly receive a fine in the mail or have the cops at your door. The FTC said that they will issue warnings first and only prosecute repeat offenders.

Ok, I understand, now what do I do?

Whether you like it or not, mandatory disclosure of affiliate links is a reality. So here are a few basic guidelines for keeping yourself within the law.

1. Disclose your links (Obviously!!):

If you have an affiliate link, you need to say it's an affiliate link. Some people might start using the (aff) notation next to their links, though personally I find this annoying. You can just say it in your copy, 'click on my affiliate link below to find out more about Product X'. You'll notice that when we promote products on Affilorama, we typically always refer to the link as being our affiliate link anyway, as we provide bonuses that people can only claim by buying through our link. Providing exclusive bonuses is a great way to turn disclosure into a selling point.

2. Don't Lie:

The new guidelines are not just going after paid endorsements or “material connections”, but also false claims made by people promoting a product. But before you start moaning about free speech, remember you are still able to say anything you like about any product. But if you are promoting it, you are no longer just anyone talking about a product; you are a marketer, so you have to watch what you say. Some companies have got away with getting their affiliates to say things that they can't legally say themselves. Make sure any statements you make are substantiated (backed up). If you can't back it up, either get rid of it, or write it differently. “When I used product X, I found that it worked really well for me” - this refers to your personal experience and is not the same as saying “This product will definitely do this for you”. Be careful with those “non-typical results” as well. Just because someone lost 200 pounds doesn't mean everyone will.

3. Give your readers some credit:

People are actually smarter than you think. Don't assume that if you tell people that you're making money out of promoting a product that they're going to ignore you. Apart from a few overly self-entitled people who think that everything on the internet should be free, most realize that people should be reimbursed for their time. To go back to my earlier example – I know Tiger got paid for that Gillette ad, but I still brought a Fusion Razor!

 

In my experience, the law typically trails technology by at least a decade and often it's a pretty bumpy ride to catch up. The best idea is to try and stay ahead of the law, rather than be caught off guard when it catches you out. I've always believe that honesty is a good thing – and I think that this will remain to be true in affiliate marketing.

38 Comments Add your comment
  • Reply Brian Pruitt1942 days ago

    I wonder how this will work with Adsense sites. Ive been actually contemplating building a few Authority Adsense sites. I cant see the FTC making a person tell their visitors that the Google Ads on the website will make that person money if they click on it. You can thank all those Acai Berry scam sites for getting the attention of the FTC. I can see them cracking down on CPA offers as well.

  • Reply Chin chin • 1942 days ago

    Thank you for writing about this and getting me informed. I'll be careful in writing my posts and will disclose affiliate products I'm endorsing.

  • Reply Andre Punter1942 days ago

    I 'm with the FTC on this one really. I can fully understand where this is coming from.

    Just try to find objective reviews on products like Afillo BP (or most other IM products), XSitePro, SiteBuildIt etc. You simply can't. Simply because all the "reviews" are from people who are affiliate of those products. And it is a given fact that an opinion on a product from someone who's selling that product , will be a biased one. it's like trusting a car salesman when you buy your new car. Who does that?? ;)

    To be honest it is something I'm struggling with from the beginning. Affilorama BP is a great course to learn the affiliate business and how to put up your website. But let's be honest: It does also tell us to go where the market is big. Like go make a site about Acne or World of Warcraft even when you never had an acne problem your whole life or when you never played the WoW game. Just put up a site and try to get people to buy the related ebooks or courses.

    And this is where you have to be careful I think. I am trying to find my way in this "moral" mix of feelings about that concept.

  • Reply Patrick Payne1941 days ago

    SO how do we disclose that a linked image is an affiliate link? Maybe just some small text underneath the image or something?

  • Reply Wyatt Teng1941 days ago

    Will this only be an issue for Americans? As we all know there are so many other affiliates who are not based in the US.

    If this is the case, it doesn't seem to affect the market much though.

  • Reply Chris Goddard1941 days ago

    It's difficult to say at this stage what the effect on international affiliates will be. As I said at the start, being based in New Zealand, we don't come under the FTC's ruling. That being said, many if not all of the affiliate programs and networks we're associated with are based in the States.

    So even if you aren't based in the States, my instinct tells me that part of your business, whether it be the product you're promoting or the affiliate network is based in the States, and therefore will come under the law. US sites may start dropping affiliates who don't subscribe to the FTC's standard for fear of being prosecuted themselves. It will be interesting to see how this will pan out though.

    You completely right in stating that the FTC has no direct authority over international affiliates. But what happens in the US does tend to affect what happens in the rest of the world.

    @PPAYNE Text under the picture would probably suffice, however I see a better option as disclosing the fact that you're an affiliate within the body of your copy.

    @XENOPUS - There are definitely moral implications in affiliate marketing. And its something every affiliate has to decide for themselves. Although you might not have acne or play WOW, that doesn't mean you can't become a helpful resource for people who do have those problems - just be honest.

  • Reply Wyatt Teng1941 days ago

    Hey Chris, thanks for enlightening me. Appreciate that =)

  • Reply jason blayde1941 days ago

    very well written article chris. as always. i've been reading a lot of fear mongering about this new ftc ruling, and i'm glad you set us straight.

    my question is, well mark be updating this in the blueprint or a vid release. so far when we've been shown how to create our links it's something like this "click here to get your dog to stop barking now"

    will you guys offer us some better examples we can use on our own sites?

    cheers,

    jason

  • Reply Chris Goddard1940 days ago

    Thanks Jason. That's a really good point. I have a talk with Mark when he gets back next week and see what he thinks. Obviously most of our material was written before this new ruling - but we'll have a talk and see what we can come up with.

  • Reply Colin Cox1940 days ago

    I thank you for opening this discussion with such a good article. Of course the Americans will do whatever they want and I, like countless others in and out of America, will toe the line if not doing so affects business - and that is what absolutley galls me. I am becoming a lacky to some anonymous bureaucrat in a grey suit and an American to boot! Thats not my idea of freedom. My preferred position is for government to stay out of business. What is the next requirement - to reveal how much commission you're being paid so that the consumer can decide whether you are worth it or not?
    The problem with this type of rubbish regulation and intervention is that it just opens the door even further for Big Brother to step through. I am totally opposed to it.
    As an Australian - not subject to American regulation - I will resist it for as long as I can. Would you be so willing to comply if this regulation came from North Korea or Communist China? American government intervention in my life and my business is equally unwelcome.

  • Reply Troy Todd1940 days ago

    Personally I am sooo sick and tired of this FTC ####. Just another way for the government to stop the little guy from getting ahead and making money for himself instead of being a nice boy and getting a job for 60 years. I agree, that you should put a disclaimer on your TOS page or similar on your affiliate site... but right under every link and picture? please...
    EG: I put up a quality page with a CPA offer that truly is targeted and appeals to the person who fills in his details... He doesn't need to know I am getting a buck for him filling out an offer that he truly wants to fill in to get a free trial etc..
    Big brother is alive and well...
    Sorry guys... I am usually calm and collected... but this issue really ticks me off.
    If I want an xsitepro review then there are some really good reviews around... and if they have an affiliate link I will click on it and buy it... but there are those people who HATE anyone getting money from them for buying something... and will go out of there way after reading your great review.. they will go directly to the xsitepro site and buy direct from the company.

    I'd like to know Mark's thoughts on this and hey he may have points that change my mind on the issue... But for now.. I remain steadfast in my opinion that Big Brother is alive and well and in protecting the innocent, it also hinders freedom and opportunities for honest affiliates who provide great content and reviews.

  • Reply Troy Todd1937 days ago

    I thought I would post this as it's related.
    http://www.webpronews.com/topnews/2009/07/02/hawaii-governor-vetoes-amazon-tax-law
    I can not believe the government can bring in such a silly tax.. it has already affected affiliates in some U.S states. Lets hope other states are as smart as the ones that vetoed the new tax.

  • Reply Marcia Ming1937 days ago

    I live in the United States and so I know I will be subject to the law. I recently had my affiliate account with a major online retailer because of a new sales tax in my state. I am learning to become an affiliate and this does not bode well for my business.

    The irony is that I am a former journalist and I will simply not promote something I don't believe in, no matter how well it pays. I bring my own ethics to whatever I do and people like me who are ethical may not succeed in this business if this continues. I like the choice of the word "bumpy,' to describe this stage of Internet development.

  • Reply Patrick Payne1936 days ago

    So does this mean that every single article needs to disclose an affiliate relationship, or can it just be disclosed once in an "About Us" type of page? Or could I just add affiliate relationship info as a footer to each page?

  • Reply Tammy • 1935 days ago

    I personally think this regulation is a load of BS. I hate regulation generally - i just think that it starts with the best of intentions but snowballs quite quickly. Generally though i think that the market takes care of it - if people demand disclosure, affiliates will start to disclose…
    However, what is the point? it doesn’t change the price that product creators will sell it for, so who cares? Would love to hear your thoughts!
    ~tammy

  • Reply John Vazquez1934 days ago

    Thanks for great post, Chris! For someone in the middle of building his first niche site, this is a troubling development. I understand the need to protect the "innocent" but too often increased regulations end up hampering honest business people. The crooks will always find ways around the regulations and continue to profit. Attaining a 1% conversion is hard enough under the best of terms. What effect will the new rules have on conversion rates? Can't see how constant reminders that webmaster is an affiliate of the featured product will help. Hope Mark and his staff can enlighten us on how to deal with this on the web page. Will we have to identify each and every link/iimage as an affiliate link? Can we, as others have asked, offer full disclosure on an About Us or Disclosure/Disclaimer page instead and be done with it? Has the FTC offered any "specific" guidelines that address this issue?

  • Reply Chris Goddard1934 days ago

    This is obviously an issue that people have very strong feelings for. I think what's important to remember is that the FTC is not actually in the business of trying to make business harder for people. But they do have a job to do. I would not expect them to start enforcing this law from day one by fining bloggers every which way. They have already said their will be warnings.

    Also, I am not sure of the specific implications of the law, and exactly what you will have to do to be in step with it. As I said at the start, this is my best interpretation of it. Pay attention to the various other affiliate bloggers out there as well as us in the next few months as the implications become clearer.

    For a start though I would recommend reading the FTC document that I link to at the top to give you a good overview of the direction they're planning to head in.

    Thanks for all the comments everyone. Great discussion.

  • Reply Troy Todd1934 days ago

    Hi Guys,
    This is very related to the topic..
    If you want to do something about these new laws then read the following link.

    http://blog.seorevolution.com/2009/07/08/affiliate-marketing-why-state-lawmakers-are-idiots/

    T

  • Reply Aditya Kandarpa1933 days ago

    Well put; and all of the comments too. Thanks for the info - I don't live in the US either, but if something is happening there, it might come around to the rest of the places too.

  • Reply Josh Jacobs1928 days ago

    Does that mean that we need to start marking our images and affiliate links as of now?!

    -Josh

  • Reply Troy Todd1925 days ago

    Hi Guys,
    As per my posts above.. Jerry West has a video out about how he is handling the Amazon/affiliate Tax.
    http://blog.seorevolution.com/2009/07/17/amazon-affiliate-tax-solution/
    He spoke to his Attorney about this. The video is 12 mins long.
    Guys, If you feel strongly about this as I do, then contact your congressman as in my previous post.

  • Reply James Briggs1912 days ago

    "I'm not a lawyer and I don't live in the US so I don't come under FTC regulation."

    It doesn't matter if you aren't a US citizen. If you're customers reside in the US then you are under FTC regulation.

    Even if that were true. Clickbank will still be held liable for what you do if you are an affiliate. Clickbank is probably going to start dropping some affiliates because of this.

  • Reply James Briggs1911 days ago

    I just wanted to add that the acai berry controversy that caused the FTC to step in was basically caused by "Commission Blueprint". They are the creators of the honest blog technique used in those acai berry/colon cleanse/weight loss websites that you see everywhere now.

  • Reply Kathaleen Dunford1908 days ago

    I have requested permission from Mark and his team to direct you to a package that goes into protection from this issue in great depth. Until I receive this permission I do not want to offend Mark and his team and post the link here. However, if you wish to be privately told in the nicest possible way where to go for information to protect yourself send me a private message and I will respond to you with the link.

  • Reply Chris Goddard1879 days ago

    Thanks for all the interesting comments.

    @Sylonious: Again, I'll reiterate my lack of legal expertise - but the FTC, as a US Federal body doesn't have any authority outside the United States. As the internet is borderless, there is no way to prevent US citizens going on to websites hosted internationally which do not come under US or even Western law.
    I'd be interested to hear what you base your accusation against Commission Blueprint on? The idea of creating a 'honest' looking blog or website to promote a site is hardly a new one and I would be surprised if a single person or group of people are responsible for this.
    You make a good point about the affiliate network being based in the US. It will be up to the FTC how they choose to assign culpability when it comes to these issues. Is an affiliate network responsible for the actions of their customers? It will be interesting to see.

    Thanks for your input.

  • Reply James Briggs1878 days ago

    I looked back through the material again. I probably combined some stuff from their program with another program, I just can't remember what it was. There are some similarities (the before and after pictures, using testimonials, CNN/ABC news, etc. etc.) with those flogs, but not enough for me to single them out.

    Sorry, CB.

    --
    FTC held an affiliate liable for linking to a vendor who charged credit cards before the trial period is over so I would think they could hold Clickbank liable (or the affiliate vendor).

    Besides it's the only way they can regulate the market. The FTC can't track down every last 1-page spammy looking site, blog or bum page that markets an affiliate product. There are more than 1,000 small sites like that for each niche market.

    If they went after the affiliate vendor themselves that would be unfair because they have absolutely no control over who signs-up for a Clickbank account.
    --
    Going through this post again brought back a lot of bad emotions...

    If push comes to shove I'll probably put a disclaimer at the bottom of my page identifying the vendor as a site that I have a partnership with instead of spelling out that I am an affiliate marketer in each link to the vendor.

    That's not required by the law, anyway. They require that you specify that you have a relationship with the vendor somewhere in the copy, but not in every single link.

    I'm going to wait to see what Mark does (with his Dog Training and WOW site) before I do anything. Any change that I make will probably cost me at least half my sales.

  • Reply Mandy Clarke1844 days ago

    Would someone mind pointing out where is the most up to date info on the FTC clamp down and how Mark / Affilorama suggests we deal with it to ensure we comply. What is the latest update on this issue.

    Kind regards
    Mandy

  • Reply Chris Goddard1843 days ago

    Hi Mandy - This article came across my desk the other day http://adage.com/digital/article?article_id=139457

    It seems they have come in to effect now.

  • Reply Troy Todd1842 days ago

    I will not comment on this as it just ruffles my feathers too much.
    As for the U.S government and FTC, well I will keep my opinion to myself I think.

  • Reply James Briggs1839 days ago

    After Glenn Beck went on his rant about the $11,000 fine and connected it to the "attack on conservative radio" they backed off the $11,000 fine. Now they are saying that they will send you repeated warnings and take your blog down only if you don't comply.

    http://affiliate-blogs.5staraffiliateprograms.com/3627/ftc-backs-down-the-11000-fine-is-not-true.html

  • Reply paulie691839 days ago

    Do these new laws apply to affiliate websites in general, or just to blogs?

  • Reply Chris Goddard1839 days ago

    It will be all websites - blogs are really just a specific style of website.

  • Reply Troy Todd1836 days ago

    http://www.michelfortin.com/give-testimonials-reality-check/
    The link above is a good post by Michel Fortin on these new FTC rules.
    regards
    Troy

  • Reply paulie691834 days ago

    Do we have to put an annotation with every link or is it okay to document the relationship on the disclaimer page (with a link to the disclaimer in each page footer on the site). Is this acceptable?

    I agree the situation is beyond stupidity (Troy - I think EXACTLY the same as you on this believe me). I just wished our opinion's counted for something. I'm Aussie not American - why the heck should I have to subscribe to their laws when God knows we have enough of our own here to contend with. But as our opinion's don't count what's the point complaining :( A case in point: I notice that various soft drink manufacturers who advertise on television (& radio for that matter) NEVER put any copy/disclaimer on the bottom of the screen that the stuff causes osteoporosis, dental decay and can stuff your kidneys. How come? Shouldn't this kind of thing be regulated too?? Deception is rampant in the food industry!

    So is it okay just to put update our disclaimers? Does anyone know?

    Best wishes to you all
    Paul

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