BWMagic’s Internet Marketing News!
Will New Federal Trade Commission Guidelines Affect Your Online Business?
I first heard of the FTC (Federal Trade Commission) new
updated guidelines regarding endorsements and testimonials
while logging into my Commission Junction account recently.
In a Bold Headline:
“New FTC Guideline Update May Affect Your Affiliate Program”
“The FTC has updated their guidelines regarding endorsements
and testimonials. While CJ cannot give legal advice regarding
these guidelines, how these guidelines may affect your business,
or how you should proceed; we’d like you to be aware of this
update that goes into effect on 12/1/09.”
Now if I had seen that news anywhere else, I might not have
taken it so seriously. But CJ is one of my most important affiliate
networks that regularly send me hefty commission checks each month.
Anything affecting that income stream has my immediate attention.
What really has me concerned is the fact that I am a full time
affiliate marketer. Endorsements and testimonials – especially
those coming from third party affiliate programs which I promote
has me wondering how all these new guidelines and laws will
apply to my affiliate marketing and to my sites.
How all this plays out in the coming months is anyone’s guess
but anyone marketing on the web should be paying attention
to these new guidelines.
I am not a lawyer so these rules can be rather confusing and
difficult for me to understand. Also, please note, I am
NOT telling you how to proceed in this matter – always seek
out expert legal counsel and advice on this matter from a
You can expect to see a lot more disclaimers on web sites, in blogs
and in newsletters… until it becomes evident how “vigorously”
the FTC will implement and enforce these new guidelines.
Maybe this is much ado about nothing; panic without a cause…
but what is rather really worrisome is that there are no
“safe harbors” anymore… you can’t just slap a Disclaimer
or Disclosure such as “Results not typical” or, “These testimonials
are based on the experiences of a few people and you are not likely
to have similar results” and it further states “is insufficient to prevent
this ad from being deceptive because consumers will still interpret
the ad as conveying that the specified savings are representative
of what consumers can generally expect.
All your marketing and especially your Endorsements and Testimonials
must be disclosed and transparent. Anyone viewing/reading your
site or ad must know you have a material interest with the product
or service you’re endorsing. For online affiliate marketers this
may mean all affiliate links must now be disclosed or marked as such,
so that there is no deception – the consumer knows exactly where
this endorsement is coming from and/or the full material relationship
between the endorser and the advertiser/owner of the product or service.
Again not a lawyer, so this is just a layman’s reading of these
new FTC guidelines. Like most marketers, I needed help in getting
my head around all this legal jargon and regulations.
Joel Comm has partnered up with several Lawyers – among them
are KEVIN E. HOUCHIN (a Creative Business Lawyer who also has
20 years of conventional and online marketing experience) and
JOEL B. ROTHMAN who is a partner at Arnstein & Lehr LLP and
board certified in Intellectual Property Law by The Florida Bar.
Plus, JULIE YATES who has practiced law for 12 years in the areas of
litigation, commercial transactions and contract law.
They have produced a product called:
FTC Toolkit – Protect Your Business With ProActive FTC Compliance
I bought this product a few days ago and I am using it to modify
all my sites. I am an affiliate of this program since anyone who
buys it can also purchase a Trust Seal that they can place on
their sites. See example below.
Now, to say this Toolkit and the Information provided within,
was an exciting read would be totally misleading – but it is
a necessary read. Naturally, a lot of the material is presented
in a “legalese” style but I did appreciate having all this
comprehensive material at my disposal. I especially liked
the “takeaway comments” after each new rule, explaining
in simple terms what this may mean to anyone marketing on
Also extremely helpful are all the forms and examples
Agreements… actual material you can use in your business
or on your site.
I found it a bit ironic that the first thing your saw in
this Toolkit was a Disclaimer!
“This product provides information and general advice about the
law. But laws and procedures change frequently, and they can be
interpreted differently by different people. For specific advice
geared to your specific situation, consult an attorney. No book,
software, or other published material is a substitute for
personalized advice from a knowledgeable lawyer licensed to
practice law in your state.”
Which I guess is only human nature, it’s all about protecting
your own “derriere”. In this case, it’s about protecting
your online business or web sites from any actions against
you from the FTC – even if you’re making honest marketing
mistakes that you didn’t know you were making!
This Toolkit also has a Compliance Seal or a Trust Seal that
you can place on your sites. This is a service that you will
have to pay extra for with a recurring fee each month. You will
also be updated on any developments regarding these new
Actually, the Compliance Seal was one of the main reasons
I bought this product and I now have the seal on several
of my sites. Keep in mind, there are no safe harbors or
quick fixes for these new guidelines and just having the
FTC Compliance Seal doesn’t guarantee you won’t be investigated
or that you’re even in compliance – just that you’re pro-active
and doing everything in your power to uphold these new rules.
Here’s a further explanation of this Site Compliant™ trust seal:
“The Site Compliant™ trust seal is the badge of marketers who
affirmatively endorse and embrace a rigorous set of standard of integrity in
marketing. These standards include a proactive intention to be fully
compliant with the Federal Trade Commission (FTC) standards, especially
those relating to the use of endorsements and testimonials in advertising.
The seal is not a guarantee of compliance, but rather a promise to
customers and a statement to investigators of a positive intent to be and
remain compliant with FTC guidelines. Implementing the Site Compliant
standards and using the seal will not shield you from liability or the
accusation from the FTC of deceptive advertising, but it is our sincere hope
that ongoing implementation of the suggestions and policies provided as part
of the Site Compliant™ program, as well as display of the Site Compliant™
shield graphic will go a long way toward avoiding complaints, investigation,
and fines from the FTC due to confusion or inadvertent failure by a member
to achieve the required, and evolving, standards of practice required by the
Again, if you’re marketing on the net or you just have a website where you
place a few banners or a few affiliate links – you may be affected by
these new FTA guidelines. If you’re heavily into affiliate marketing
like me, then you will definitely want to do everything you can to protect
your sources of income. It is better to be safe than sorry.
Here’s that link again for the FTC Toolkit and yes I am an affiliate
and user of this Toolkit and Trust Seal: