It is no secret that many bloggers are paid to endorse brands, name-drop new cafés in town and post photographs of themselves sporting the latest tote in tan, coral, and clay. But do we have a right to know exactly when a blogger is paid to advertise, endorse or promote particular products or brands?
Advertising Guidelines
The law on blogs is not clear. The US, Australia and New Zealand all have advertising guidelines used to help advertisers comply with and interpret relevant advertising law but none of these ‘guidelines’ are legally binding.
Federal Trade Commission in USA
In the US, the Federal Trade Commission (FTC) regulates and oversees advertising and marketing. The FTC views blogs and brand pages on other social platforms as advertising and its guidelines require endorsers (including bloggers), who provide information, promote or recommend a product or a service, to disclose any connection they have with the brand
they are endorsing. These are just guidelines, however, and compliance is voluntary. The FTC can bring an action against anyone acting inconsistently with these guidelines but they have to prove the conduct violates the FTC Act. It’s hard to imagine an action like this would be brought against your everyday blogger. But it could.
Australian Advertising Standards Bureau
The Australian Advertising Standards Bureau (ASB) is a self-regulating body providing advertising guidelines and complaints services. This is similar to New Zealand’s Advertising Standards Authority (ASA) but the ASB differs in that it has held that user generated content, such as user comments posted on an advertiser’s Facebook page, is advertising to
which the advertiser may be responsible.
New Zealand’s Advertising Standards Authority
NZ’s ASA defines “advertisement” broadly, and even though the guidelines do not specifically refer to social media platforms, advertising and endorsements on blogs fall within the ambit of the definition for the purposes of the ASA. To be subject to the ASA jurisdiction, an advertiser must have a reasonable degree of control over the endorser or
advertiser. So, in New Zealand, most blogs will likely be outside the scope of ASA regulation.
Fair Trading Act principles of conduct in trade
It is easy to disregard merely recommended guidelines, but the fundamental principles of New Zealand’s advertising and consumer laws should not be ignored. One of the key principles, set out in section 9 of the Fair Trading Act 1986, is that conduct in trade must not be misleading or deceptive (or likely to mislead or deceive). Non-disclosure of advertisements and endorsements on blogs could be considered misleading or deceptive in the course of trade. Even though such a case has never arisen, as blogs grow and consumers begin to rely more on bloggers for advice, this will change. An example of
where this could occur is if a consumer relies on a product used by a blogger only to find the blogger was paid to endorse the product but doesn’t actually use it, like it or believe in it. In this situation the consumer could make a complaint under the Fair Trading Act on the basis they were misled or deceived by the blogger.
Err on the side of caution and disclose
For transparency and legal risk management, adopting the approach of uber-alty, New Zealand expat fashion blogger Isaac Hinden Miller, “Isaac Likes“, is good practice. Not only does his blog (pictured below) appeal to fashion enthusiasts, but he gives an example to bloggers of how to blog responsibly. His posts are footnoted with a number of labels including the word ‘Sponsored’ on posts where he is blatantly promoting a brand or product. Despite the lack of legal action brought against bloggers for non-disclosure erring on the side of caution like this is recommended. Bloggers – label posts of endorsements or advertisements with, at minimum ‘Ad’ or ‘Sponsored’. It’s an easy way keep readers happy as well as the law in this area untested.
In summary
For the purposes of the article the intention was that ‘advertising’ or ‘endorsing’ a brand on a blog is where someone promotes (either by mentioning, providing a link to their website, etc) a brand on their blog for reward. A reward could be vouchers, free products, payment etc. For the blogger, where there is an incentive to promote a brand or product, by that brand, it would be good practice to disclose. Whether this is by saying, “thanks to”, “sponsored”, “in collaboration with” or “brought to you by” is open-ended. Ultimately it must be viewed in the eyes of the reader – would the common blog reader, reading the post be able to tell whether a brand has paid or provided incentive to the blogger to advertise/promote/endorse the brand or product?
The authors are: Tracey Walker, Special Counsel and Alexandra Perry, Law Graduate, from Simpson Grierson.
6th November 2014
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