Apr 09, 2009

For Brands and Bloggers, It's Tell the Truth or Face the Consequences

The Federal Trade Commission (FTC) any day now is expected to adopt revised guidelines on endorsements and testimonials. What this means to the world of interactive marketing is that companies and bloggers alike can be held liable if a blogger to whom a brand has supplied free samples of its product in the hopes of receiving some online buzz makes any false statements about this product. The bottom line is that both sides will pay the price for word-of-mouth efforts that do not follow the tenets of truth in advertising.

The practice of brands recruiting bloggers to talk about their products is something I've talked about before. I went over some steps brands need to take maintain their credibility when engaging in this practice. These new guidelines add an entirely new wrinkle. Rather than risking the potential of damaged credibility from a pay-per-blog arrangement, brands now have to worry about actual legal responsibility for what their blogger mouthpieces say.

While some are viewing this change as being too stringent and potentially negatively impacting the development of social media marketing, there is actually a large upside to the new regulations that might lead to some bloggers earning more credibility than they ever had before.

The Wild West approach to the use of word-of-mouth online, where bloggers could make whatever claims they wanted to about a product and not be held accountable if these claims turned out to be untrue, is over. With consumers protected from false blogger claims, viral marketing of this kind becomes more of a challenge and a risk for brands. In the long run, however, it will help make bloggers a more reliable resource for marketers to use.

If bloggers can only supply accurate endorsements, consumers will be able to trust that they aren't being given a line of snake oil salesman flimflam. Bloggers will be able to establish reliability and credibility so when they say "Product X can actually do what it claims to do and actually does this too," consumers can have faith that they can invest their trust safely because either the claim will be true or if it is not, the blogger as will be faced with unpleasant consequences.

Brands might shy away from pay-per-blog initially but with the proper precautions and agreements in place, they could make sure the bloggers play nice, at least by FTC standards. As I've said in my previous post, bloggers and brands need to be upfront whenever they have any sort of relationship. A careful brand can make this relationship more formal if it requires a blogger to agree to provide only accurate and honest assessments and discussions of the brand's product or service.

This type of agreement might scare off some bloggers but those who agree to comply can potentially become the equivalent of Siskel and Ebert in the eyes of consumers. Their word would be worth more because it would be seen as more reliable given their agreement with the brand as well as the threat of liability that the FTC will soon have in place. Consumers will be able to be assured that a blogger' opinions are based on the actual quality and performance of a brand's product or service and not founded on half-truths, wild exaggerations, and outright lies.

So the sky isn't falling on social media marketing. The FTC has actually acknowledged the viability of word-of-mouth and viral marketing by expecting them to adhere to the same standards and practices as other forms of advertising. And once the dust settles, brands will have a means to receive stronger, more credible online buzz and bloggers will have opinions and voices that will carry much more weight with consumers.


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