2020Directory_FNL_FlippingBook

In addition to the challenges posed by making disclosures on electronic devices, the FTC has identified two other major issues with online and social media advertising: • Native Advertising (“sponsored content”). Promotional messages that blur the lines between advertising and content are common on the Internet but may be deceptive. The FTC has issued an enforcement policy statement on “deceptively formatted advertisements,”defined as promotional messages that are integrated into and indistinguishable from non-promotional content, such as news, featured articles, or product reviews. The policy statement states that advertising and promotional messages that are not readily identifiable as such are deceptive, because they are likely to mislead consumers into believing the messages are independent and impartial. In these situations, the advertiser must clearly and conspicuously disclose that the embedded message is an advertisement, for example by putting the phrase “PAID ADVERTISEMENT”at the top of the message. • Deceptive Endorsements. Promotional communications that include purported endorsements or testimonials from experts or consumers who have some connection with the advertiser are deceptive absent a clear and conspicuous disclosure of the nature of the connection. For example, if the endorser has received compensation or free products from the advertiser, those facts must be disclosed. The FTC’s Guidelines on Endorsements and Testimonials are described in more detail below. • Online Influencers. The FTC brought its first enforcement action against individual online influencers for failure to disclose material connections with the companies that they promoted. This appears to be an area of emerging interest for the FTC. Social Media Advertising Social media sites offer dealers a new way to connect with consumers through consumers’ principal means of staying in touch with friends, colleagues, and companies with whom they share an interest or have a relationship. But, increasingly, advertisers are using social media to disseminate commercial messages, and government regulators are actively monitoring social media to look for deceptive practices. The suggestions for advertising practices described above, including those described as part of the FTC’s “Dot Com Disclosures” guide, should be reviewed to help advertisers make effective online disclosures. Advertisers on social media must make sure that (1) their claims are truthful and substantiated, (2) all required disclosures are clear and conspicuous, and (3) advertising content is clearly distinguished from non-commercial content. Several of the FTC’s deceptive advertising cases have addressed social media advertisements. The ads came to the FTC’s attention as a result of FTC staffers searching the Internet and finding the ads on sites such as YouTube. Any dealership that plans to launch a social media presence, or whose employees have access to and use such sites, should adopt a Social Media Policy. The Policy should place reasonable limits on employees’use of social media in a way that can be tied to the dealership.

HOT TOPICS

169 2020 MEMBERSHIP DIRECTORY & SERVICES GUIDE