How To Comply With The New FTC Internet Marketing Guidelines

The New FTC Internet Marketing Guidelines:  How To Comply To Protect Your Business

Yesterday the FTC officially announced that they are implementing a 2^nd phase of new guidelines pertaining to marketing, advertising and product/service testimonials.  These guidelines are in addition to those that were announced in late August (August FTC Guidelines article: http://tinyurl.com/ygs42ys ).

Many originally thought the steps that would be taken would be to punish fake or deceptive blogs.  This is basically referring to a blog with a totally nonexistent author containing one post/story that promotes a product or service for a CPA (cost per action) offer.  These are typically marketing such things as weight loss, making money online etc.  Although this might have been one factor, the new guidelines were more far reaching than many anticipated and will permanently change how internet marketers do business.

Now, before I jump into this let me start by saying that I ALWAYS see these developments as positive ones.  Guidelines like these dramatically thin out the competition and create a level playing field for those of us that conduct ourselves professionally and offer a real service or product.

Guidelines On  Testimonials

Having said that; let me give you the lowdown on the new guidelines.  I was able to get some feedback from a former FTC attorney who said:

“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.”

Until now one was safe by simply putting the standard disclaimer verbiage “results not typical – your results may vary…” disclaimer on their site.  That however will not be sufficient moving forward.  If you have a testimonial it will be assumed that you are conveying that those outstanding results are ones that the average consumer can expect and you better have documentation to back that up as well.

My source also said “The FTC also said that it believes that it is “likely” that testimonials that present the specific experiences of a product user (e.g., amount of money made, amount of weight lost etc) will be viewed as claiming that those experiences are typical of what consumers will generally experience.”

So, the guy who uses your instructional video to make 10K a month can only be used if it also states what the average user of your product has experienced. The bottom line is if you are an affiliate marketer and you use testimonials you better know what the statistics are to back up what the average user can expect.  If you don’t you need to find that information and document it on the page.

Affiliate marketers must do their due diligence to investigate a product before they advertise.  Too many have made bells, whistles and profit the main focus of their decision making as they choose a product to represent.  Always remember that the product or service is an extension of you.

Reviews & Endorsements

Some might ask, what exactly constitutes an endorsement? It may be a “review” conveyed by bloggers or other online “word-of-mouth” marketers. The revised Guidelines specify that the post of a blogger who receives cash or in-kind payment to review a product or to induce the purchase of a product for payment (ie affiliate marketers) that is considered an endorsement. Thus, bloggers who make an endorsement must disclose the material connections they share with the seller of that product or service.

In other words if you are reviewing or endorsing a product with your affiliate link appearing underneath, you have to reveal that arrangement.  For example “I love this product which is why I endorse it.  If you click on the link; I will receive compensation that I will most likely waste on shiny things and candy”, or a disclaimer to that effect.

My (non legal) Advice

1. Don’t try scheming ways to get around the rules because you’ll be black marked.  No one gets around the FTC for very long without getting flagged.  Don’t punch that horse in the nose.
2. Testimonials were all the rage several years ago however so many online marketers and TV infomercials paid someone to create them that their effect was watered down.  I don’t like using them primarily for that reason.  I market myself and my integrity branding.
3. If you are reviewing a product that you have an affiliate relationship with, you must reveal that affiliate relationship and that you will receive compensation.
4. If you communicate true value to your customer before you ask for the sale and your price point is congruent with that perceived value then you should be able to sell to your hearts content.
5. If you’re marketing a product or business opportunity that does not stand on it’s own without the smoke, mirrors and exorbitant claims then my advice to you is to DISCARD!  Discard and do it quickly.  Then do some due diligence and pick up some strong viable alternatives to market that have integrity and can get results.

Conclusion

As I said previously, this is a GREAT thing in my opinion. All those that muddy the internet marketing water will be thinned out as will those who are weaker willed individuals who will just plain walk away altogether.  As I have always said, there is plenty of market share to be had for any entrepreneur who markets on the internet the right way.

The rules for long-term success have always been the same.  If you offer a product or service that truly provides a solution to a want or need then you can always be successful.  Make sure what you are representing is something you can stand behind and market without going outside the new guidelines to get a sale and you’ll all be fine.

Patrick Daugherty

“The Biz Coach”