Wrestling with Questions of Ethics
One of the more important sessions at last week’s WOMM-U conference was on Ethics, Endorsements, and Your Next WOMM Program. Paul Rand, WOMMA’s Ethics Chair, and Anthony DiResta, former regional Federal Trade Commission (FTC) Director, discussed impending changes to FTC guidelines on testimonials in advertising.
Specifically, the FTC is seeking to ensure Advertisers and Bloggers are 100% transparent and always disclose when a blog post is being sponsored. “Sponsored Conversations” is the term being used to describe a situation where a business compensates a blogger in exchange for writing a post about a product/service a business provides. Lots of businesses are doing this and because it is a cost-effective marketing activity, it’s likely more businesses will be doing “Sponsored Conversations” with bloggers.
Additionally, the FTC is proposing to make Advertisers liable for the actions of their sponsored Bloggers and make the Bloggers personally liable for their actions.
Why? Well, the FTC is in the business of protecting consumers from unscrupulous business practices. The commission believes consumers must be protected from being influenced by bloggers who fail to be transparent and disclose they have been compensated by an advertiser. The worry, of course, is compensated bloggers may not give their honest opinion about the products/services they’ve been compensated to write about.
This issue gets muddier when it comes to defining compensation. Clearly, cash is compensation. But in-kind gifts and special access privileges are harder to define as compensation and payment. For example, is giving a blogger a book to review considered compensation? How about giving a blogger access to test drive a new car, is that compensation? Outside of cash, defining payment gets cloudy.
While there is much that is unclear with “Sponsored Conversations,” WOMMA has been very clear about its stance on Ethics and Endorsements as it relates to businesses and bloggers.
The WOMMA Ethics Code clearly asks businesses and bloggers to disclose their relationships and to disclose if the blogger received product samples or other incentives from a business.
The WOMMA Ethics Code also asks for honesty in all aspects of Word-of-Mouth marketing from truthfully disclosing relationships between a business and a blogger/customer and truthfully sharing authentic opinions with others about a product/service in online and offline conversations.
Designing and executing Word-of-Mouth marketing programs that follow the WOMMA Ethics Code of always disclosing relationships and always sharing authentic opinions is one way to avoid scrutiny and controversy.
Another way to avoid scrutiny and controversy when executing Word-of-Mouth marketing programs is to reconsider paying outright cash to entice bloggers and customers to either write something or say something about your business. (Just as in life, when money gets involved, issues seem to follow.)
Of course, the absolute least controversial method for businesses to get bloggers to blog and people to talk is to design products/services that are inherently worth talking about. (Yeah, yeah … easier said than done.)
It’ll be interesting to see where the FTC nets out on this important matter because lots of questions need to be answered. What ramifications are likely for Advertisers and Bloggers who run afoul of updated FTC guidelines? How will businesses and marketing agencies respond to the new guidelines as bloggers continue to gain more sway in helping to shape public opinion?
Let’s talk. The comments are open. The opinions will be varied. I’m sure you have something to share. Have at it.
