Natural Products Insider

NOV-DEC 2018

INSIDER is the leading information source for marketers, manufacturers and formulators of dietary supplements, healthy foods and cosmeceuticals. Since 1997, INSIDER has been serving the needs of the global nutrition industry.

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naturalproductsinsider.com 47 connection is not disclosed. For example, in 2011, in one of the fi rst enforcement actions involving social media, FTC released a letter concerning a blogging campaign intended to build interest in ads that Hyundai Motor America was premiering during Super Bowl XLV. FTC's concern was whether the bloggers involved in the campaign, some of whom had been given gift certifi cates as an incentive to include Hyundai links in their posts, were told to disclose that they had received compensation or were told not to. It should be noted that even though Hyundai had hired a public relations (PR) fi rm to run the campaign, FTC determined Hyundai could still be held responsible and was, therefore, required to monitor and supervise any PR or advertising fi rms it engaged. If a blogger/reviewer is employed by a television station or newspaper, consumers can be expected to understand that it is the blogger's job is to provide an opinion on behalf of the newspaper or television station, and that they did not actually purchase the product being reviewed. On the other hand, such compensation or relationship is not generally obvious when a review appears on a personal blog, social networking or similar media. In these instances, FTC requires disclosure of the compensation or relationship because such disclosure helps readers to determine the value to give the recommendation. Imagine being given a free product and asked to "tweet" about it. In that situation, wouldn't a person be more likely to provide positive feedback about its benefi ts? And if someone were reviewing social media posts on a product, wouldn't it infl uence the weight he or she might place on the reviews if it were disclosed that the posts came from employees or people related to the owners of the marketer? What about if one were planning a vacation and reviewing travel sites? Wouldn't he or she evaluate the reviews differently if informed that the hotel had paid some of the bloggers to write the reviews or had allowed them to stay at the hotel for free? So, in terms of the marketer, if a company is "organizing" a social media campaign, then it must ensure the bloggers or other participants are properly disclosing the relationship and/or the compensation. If a company is considering an infl uencer campaign, a lesson in what not to do can be learned from reviewing Lord & Taylor's 2015 campaign to promote a new collection of women's clothing. Lord & Taylor began by arranging for an online fashion magazine to run what appeared to be an "article" and to post a picture of a specifi c paisley dress. But it was not a true news article, as the retailer reviewed, approved and paid for the "article" (these pieces are sometimes referred to as "advertorials"), but this was not disclosed. Lord & Taylor next "recruited" a team of 50 "fashion infl uencers," who were paid between US$1,000 and $4,000 to post pictures of themselves on Instagram in the paisley dress on the same weekend. For FTC, the campaign itself was not the issue, but the fact that Lord & Taylor did not disclose that it was behind the coordinated actions of the magazine and provided compensation to the infl uencers. FTC charged that the retailer falsely represented the 50 Instagram photos and captions were independent statements of impartial fashion "infl uencers," when it was really a paid, coordinated campaign. FTC further charged that the retailer had falsely arranged to have the magazine present the initial article in such a way as to have consumers believe it refl ected independent reporting, when it was nothing more than paid advertising. To settle with FTC, Lord & Taylor agreed to disclose material connections, and to further monitor its infl uencers, which included obtaining written acknowledgements by infl uencers of their duty to disclose any material connections. This is, of course, what would be required by any company intending to run a similar infl uencer campaign. Such disclosures do not need to be complicated, and FTC does not mandate specifi c disclosure language. Some examples of acceptable disclosures could be: "Company X gave me this product to try," noting in the post that the blogger was "paid," that he or she is an employee of the company, or for a platform such as Twitter that limits characters, perhaps, "paid ad," "sponsored" or "promotion." One thing is generally certain: FTC does not believe that a single disclosure on a home page is effective because it may not be seen by all readers. Disclosures should be part of each individual post. Further, any paid advertising that appears to be an impartial article written by the host magazine or publisher violates FTC's guide concerning "native advertising." In its Native Advertising Guidance, FTC explained online advertising must be clearly identifi ed as advertising, and cannot be formatted in a way to confusingly appear to be news, feature articles, product reviews, entertainment or other nonadvertising material. Any attempt to fool or mislead readers about the source of the Legal: Endorsements Social Media Marketing at SupplySide West Social media is a valuable tool to reach consumers with information about products and promotions. Though the opportunity is great, so are the challenges. Companies wishing to take part in social media marketing are tasked with allocating infl uencers and understanding the nuances of the various platforms, including who key audiences are and how to effectively communicate information while adhering FTC regulations. Learn more about social media marketing during the "Marketing Effectively & Legally via Social Media" Workshop on Thursday, Nov. 8 at 2 p.m. at SupplySide West in Las Vegas. supplysideshow.com Scan Here

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