The Word of Mouth Marketing Association (WOMMA) recently released an updated Social Media Marketing Disclosure Guide. The purpose of the guide is to help marketers to comply with the Federal Trade Commission’s Endorsement Guidelines, which require companies to disclose material connections between the company and a person endorsing its products or services.

As you may recall from our earlier alert, the FTC’s Endorsement Guidelines require companies to disclose material connections and were designed to help companies comply with the FTC Act by avoiding creating advertising that is deceptive and misleading to consumers. Under the Endorsement Guidelines, companies may not use terms such as “results not typical” standing alone to notify consumers that an endorser’s experience with a product is not one that a regular consumer can expect. Additionally, bloggers and individuals talking about a company or its products and services must disclose any material connection they have to that company. Celebrity endorsers are also held to strict standards and those that endorse a product or service may be held liable, in addition to the company, if the FTC brings an action for false and deceptive practices.

WOMMA released guidelines to assist companies with compliance in the social media context. According to the guidelines, businesses should do the following:

  1. Notify endorsers and marketing agencies acting on behalf of the business about their responsibilities;
  2. Monitor advertising to ensure compliance;
  3. Correct any failures to comply with the Endorsement Guidelines;
  4. Ensure that marketing agencies and partners are aligned with company policies; and
  5. Educate and monitor employees to ensure that they understand their responsibilities under the Endorsement Guidelines.

The WOMMA guidelines are available here. In addition to providing best practices, the WOMMA guidelines also provide businesses with sample language to be used to avoid an enforcement action based on failure to follow the Endorsement Guidelines. For example, on Twitter, WOMMA suggests using hash tags such as “#spon” or “#paid.” It also suggests language for blogs and status updates on Facebook.

All companies operating in social media should be aware of the Endorsement Guidelines and should consider consulting the WOMMA guidelines for sample language.  Failure to comply may result in an FTC enforcement action.