From the AP, we learn that the FTC is contemplating plans to monitor bloggers for potential conflicts of interest due to non-disclosure of commercial relationships:
It would be the first time the FTC tries to patrol systematically what bloggers say and do online. The common practice of posting a graphical ad or a link to an online retailer — and getting commissions for any sales from it — would be enough to trigger oversight.
The oversight would be primarily focused on bloggers who provide product reviews. Under the new guidelines, these bloggers would be liable for failure to disclose any compensation by marketers of those products. However, this oversight would also extend to the affiliate marketing relationships that are the bread-and-butter of many bloggers:
If the guidelines are approved, bloggers would have to back up claims and disclose if they're being compensated — the FTC doesn't currently plan to specify how. The FTC could order violators to stop and pay restitution to customers, and it could ask the Justice Department to sue for civil penalties.
Any type of blog could be scrutinized, not just ones that specialize in reviews.
So parents keeping blogs to update family members on their child's first steps technically would fall under the FTC guidelines, though they likely would have little to worry about unless they accept payments or free products and write about them.
But they would need to think twice if, for instance, they praise parenting books they've just read and include links to buy them at a retailer like Amazon.com Inc.
Bloggers, while acknowledging the need to transparently disclose commercial relationships to their readers, are predictably less than enthusiastic about the prospect of the federal government getting involved. James Joyner of Outside the Beltway comments:
The problem with the proposed change — or perhaps the misreporting of it by [AP reporter Deborah] Yao — is that it appears to target bloggers as publishers rather than merely extend existing limitations on advertising to blogs. I’ve got no problem with the FTC going after advertisers for illegal practices. If a blogger engages in payola, though, the penalty should be exposure and loss of journalistic credibility, not fines from the FTC.
[...] I’m not sure why the FTC would investigate something like this but allows the common practice of product placements in movie. Most viewers are unaware that the hero’s wearing of an Omega watch was secured by payment of princely sums.
Surely, the federal government has better things to do than scouring blogs looking for undisclosed conflicts of interest?
Earlier this year, Forrester Research came out in favor of marketers paying bloggers for what it called "Sponsored Conversations," based on some very specific guidelines:
The two most important conditions that marketers must follow when using sponsored conversation are 1) sponsorship transparency and 2) blogger authenticity. Sponsorship transparency means that both the marketer and the blogger must make it absolutely clear to the reader community that they are reading paid content – think of Google Adwords "Sponsored Links." Blogger authenticity means that the blogger should have complete freedom to write in their own voice – even if the content they write about the brand is negative.
Andy Sernovitz, writing in The Huffington Post, echoes the critical need for full transparency:
The difference between advertising and sleaze is disclosure. It all comes down to properly saying, "And now, a word from our sponsor." If you say something is paid for, or write "Advertisement" on the top of it, everyone knows that it's not editorial. The problem comes in when you don't give proper disclosure, or try to hide it. The FTC agrees, and says that you need to make your disclosure clear to the average reader.
Sernovitz goes on to point out another problem: "disclosure isn't sticky," i.e. even if a blogger discloses a paid relationship, that disclosure may be lost over subsequent reposts by other bloggers who excerpt material from the original. This effect puts a blogger's credibility at risk, even nothwithstanding full disclosure in the original post. In Sernovitz' estimation, it's not worth it, and the consequences are dire. His advice is stark and uncompromising:
Bloggers: There's no reason to go here. It only takes one missed disclosure statement to ruin your reputation forever. Feel free to take advertising, but when you sell your editorial, you are forever tainted.
Readers: Zero tolerance is the only option. Boycott any blogger or Twitterer who writes paid posts. Un-friend them on Facebook. Friends don't sell out their friends.
Marketers: Don't pay for blog posts. Ever. There's no ethical or safe way to do it. It only takes one blogger who forgets to post the disclosure to humiliate your company, launch a PR scandal, permanently damage your brand, and have the FTC knocking at your door. On top of that, it generates embarrassingly bad advertising that doesn't work. It's not worth the risk (and it's wrong).
Bloggers trade in trust and authenticity. They are not expected to be objective, and in fact build readership based on people valuing their outspoken opinions on eveything from products to politics. While many accept online advertising in the form of banners, Blogads, Google AdWords, Amazon affiliate links or other formats, these arrangements are no different than newspapers or magazines selling space to display advertisers.
Where the line is crossed is when commercial relationships are not transparent and disclosed, as in the case of bloggers who write favorable reviews because they were paid to do so, or have been provided incentives or perks by marketers, but fail to disclose that to their readers. Most bloggers would lose readers and credibility for this lack of transparency. Under the FTC's new guidelines, this may result in fines or other legal action.
Theoretically, a pay-for-post relationship between a marketer and a blogger is perfectly legitimate if fully disclosed -- but in practice, it's inherently self-defeating. Ask yourself: why would anyone give credence to a product review that was obviously bought and paid for?
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