misled into a false sense of complacency
and conclude that these actions by
the FTC amount to little more than yet
another bureaucratic exercise--all
bark and no bite. Despite the seemingly
innocuous choice of title, the FTC's
misnomered "guides" are actually
codified regulations located in the
Code of Federal Regulations (16 CFR
§ 255 et seq., for those keeping track
at home). These regulations, in turn,
are promulgated by the FTC pursuant
to 15 USC § 45, which empowers the
Commission to prevent the use of "unfair
methods of competition in or affecting
commerce and unfair or deceptive acts or
practices in or affecting commerce."
In other words, rather than merely
serving as a friendly reminder of best
practices, the FTC's Endorsement Guides
carry the full force of law. The penalty
for their infraction? Up to $16,000 per
violation.
Unfortunately, given the increasingly
scattered nature of online influencers, it
becomes very difficult to determine what
violates the FTC rules. In the case of the
included "#ad" in her post to indicate
that it was sponsored content. Is this
enough?
According to the FTC, maybe.
Then again, maybe not.
To help answer this question,
consider a recently-issued public
statement by the FTC, wherein the
Commission observes that "when
multiple tags, hashtags or links are
used, readers may just skip over them,
especially when they appear at the end of
a long post--meaning that a disclosure
placed in such a string is not likely
to be conspicuous." In addition, the
Commission points out that "consumers
viewing Instagram posts on mobile
devices typically see only the first three
lines of a longer post unless they click
`more,' which many do not." Thus, says
the FTC, endorsers "should disclose any
material connection above the `more'
button."
In the case of Ratajkowski's "#ad"
hashtag then, the question of compliance
likely turns on whether it stood alone,
or whether it was part of a longer string,
and/or whether it appeared above or
above, it likely complied. If it failed
to satisfy either of these conditions, it
probably didn't. Then again, depending on
the circumstances, maybe it did.
So much for guidance.
Fortunately, thanks to Instagram,
brands and influencers looking to avoid
the FTC's wrath are not left completely in
the dark. In the wake of the Fyre Festival,
the social media juggernaut announced
a new feature intended to make those
hidden hashtags easier to spot: a "Paid
Partnership With" tag that easily alerts
users that a post has been paid for. Best
practices dictate taking advantage of
this feature, as it could well become the
gold standard of compliance once users
become accustomed to seeing it.
Of course, whether or not the new
Instagram feature will ultimately
satisfy the FTC is something only the
Commission itself can decide. Hopefully,
the public will get some clear guidance on
this question soon. Just don't expect it to
come from the FTC.