Earlier this month, the Federal Trade Commission (FTC) resolved charges against individual social media influencers for the first time. If you are interested in reading the actual decision, you can find it here. The primary issue the FTC focused on was the nature of disclosures that are required when influencers promote or endorse products or companies that are self-owned, or to which the influencer has a "material connection."
In addition to resolving the charges against the two influencers in question, the FTC sent letters to numerous online influencers providing this warning: If you are an online influencer, and you promote companies or products to which you have a "material connection" through your online accounts, you had better "clearly and conspicuously" disclose your connection with the company, product, or service.
Is this warning relevant to you? To answer that question, you need to determine if there is a "material connection" between you and the marketer of a product you endorse. The FTC has defined a material connection as "a connection that might affect the weight or credibility that consumers give the endorsement." The FTC further explained, "material connections could consist of a business or family relationship, monetary payment, or the provision of free products to the endorser."
Based on this broad explanation of what might constitute a material connection, all influencers who endorse products on their social media sites should be aware of this warning.
So, how do you "clearly and conspicuously" disclose your connection with a product? The FTC encourages influencers to use unambiguous language and make the disclosure stand out. In the actual decision discussed in this article, the Commission explained, "'clearly and conspicuously' means that a required disclosure is difficult to miss (i.e., easily noticeable) and easily understandable to ordinary consumers."
If you have any questions about the actual decision from the FTC, FTC disclosures, or other related issues, please email me or set up a time to visit over the phone.