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Is that blogger review really a paid ad? The FTC wants you to know.

Consumer Reports News: June 11, 2009 01:40 PM

The web was abuzz in April with scare talk about the Federal Trade Commission’s plans to put “bloggers in handcuffs,” “turn them into criminals,” and muzzle bloggers’ free speech rights.

What evil plan is afoot? The FTC is updating its “Guides Concerning the Use of Endorsements and Testimonials in Advertising,” which were last refreshed in 1980. What this has to do with bloggers is a new form of advertising, called word-of-mouth marketing, in which advertisers pay your favorite bloggers to “review” their products. The bloggers get paid, for example, with free product samples; gift certificates for JCPenney shopping sprees; cash payments; or the loan of a $30,000 Ford Flex for a year.

The bloggers are supposed to write whatever they want about the product—pro or con—but the payments put into question whether they would be inclined to seriously bite the hand of a “friend” lending a car or giving other valuable goodies or cash. (Consumer Reports buys and pays for the products it tests, and doesn’t accept free samples.)

The FTC aims to more explicitly bring advertisers who hawk their wares through seemingly unbiased bloggers under their truth-in-advertising guidelines, which would mandate the same thing required of traditional advertising: The honest opinions or experiences of the blogger/endorser, no false or unsubstantiated statements, and disclosure—by the blogger—that he or she is being paid.

In other words, an advertiser who greases the palms of bloggers to fabricate “spontaneous” Internet buzz for his product or service can’t pretend that he’s not advertising. Blogs that promote products “are consumer endorsements. To the extent they’re paid for, they come under jurisdiction of FTC,” Richard Cleland, assistant director of the FTC’s Division of Advertising Practices told me in a recent interview.

Consumers easily recognize a regular print, broadcast, or Internet ad for what it is—and know to be appropriately skeptical. But a sponsored blog post that doesn’t look like an advertisement at all can catch consumers off-guard. No wonder advertisers covet and court the endorsement of bloggers, and studies show that bloggers influence purchase decisions.

Under the proposed guidelines, bloggers who turn their supposedly independent daily musings into a paid commercial—like advertisers themselves— would have no special license to deceive just because they’re using the Internet.

I think the FTC is right-on here. What do you think?—Jeff Blyskal

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