FTC Guidelines for Affiliate Marketing: Disclosure
For content marketers who are looking to earn money on their website, affiliate marketing is a great marketing option. The idea is that affiliate marketing is actually an arrangement between the writer of the post or promoter of the product and a retailer. The retailer pays some sort of commission or offers some sort of compensation for the traffic or sales that are generated from the referral.
Basically someone with a following, like an article writer or an influencer on social media, will write or talk about the product online. They will review the product or endorse it in some way. They will then link to the website where you can buy that product. That link is an affiliate link. For every site visit or sale they receive from those clicks to that link, they will pay the person referring them.
Where’s the problem or need for regulation here? Well, let’s say you follow a blog religiously online. They’ve never sold products before. Suddenly they are writing about a fantastic new product that you absolutely have to try. That’s a person you’ve come to trust and they are telling you how wonderful and fantastic this product is. That recommendation is probably going to seriously influence your decision to buy that product. It’s the difference between a company trying to advertise to you and a trusted friend telling you how great and life changing a product is and that you just have to try it. You’re much more likely to buy.
If that person is being paid by that company to talk about and link to that product, wouldn’t you want to know? Wouldn’t that possibly impact your decision to buy? That is the main reason for the Federal Trade Commission’s (FTC) Endorsement Guides.
The point of these guides is to honor the advertising principle that endorsements should be honest and not misleading. If there’s a connection between the retailer and the marketer, that connection should clearly be made and disclosed. This disclosure has to adhere to four basic requirements. They must be frequent, clear, conspicuous, and requiring no action.
Frequent means that there must be displayed a disclosure on every page, article, or video that promotes a product for any sort of compensation or benefit. Clear means that you have to clearly explain your relationship with the company –at the beginning of the review or endorsement. It cannot be up to interpretation. Conspicuous means that it must be easy to see –it should stand out to get attention. It must be written in the same or bigger size than the rest of the text. The color of the text must not be black or gray. It has to be colored and the color has to be darker than the existing text to stand out. Finally, requiring no action, means that the disclosure should be seen right away with no action from the reader or viewer. You shouldn’t have to scroll to see the disclosure; you shouldn’t have to click on something to read it, etc. It should be front and center –at the beginning.
There are many more guidelines that the FTC requires. This includes acceptable and unacceptable posting on social media and other platforms. Check back for the next article in this series.
What questions do you have about disclosing an affiliate article or links? Comment below!
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