Tuesday, October 6, 2009

Is the FTC about to give Rocket Languages a call?

As I've pointed out before, Rocket Languages has been conducting a pretty blatant (yet successful) astroturfing campaign. I thought that they might have been getting a bit worried when the New York attorney general started looking into the practice in other industries.

But now they'd better be worried; the U.S. Federal Trade Commission will start cracking down on astroturfing as of December 1 of this year.

From the Associated Press (via Yahoo News):
The FTC will require that writers on the Web clearly disclose any freebies or payments they get from companies for reviewing their products.
From the Financial Times:
The new focus on transparency in online advertising comes after several companies have been exposed for “astroturfing,” or creating fake grassroots campaigns, and as advertisers race to spread word of their products through new services such as Facebook and Twitter.
Astroturfing? Hello, Rocket Languages!

The Financial Times continues:
The main target of the new guidelines appears to be the widespread practice of viral marketing in which companies recruit non-employees to talk up products in exchange for samples or promotions.
Rocket Languages' M.O. is not enticing website owners through samples and promotions but rather through commissions on the sales by customers directed to Rocket Languages' products from the third-party sites.

However, it doesn't look like that difference is going to put Rocket Languages in the clear. Here's the relevant part from the actual regulation:
When there exists a connection between the endorser and the seller of the advertised product that might materially affect the weight or credibility of the endorsement (i.e., the connection is not reasonably expected by the audience), such connection must be fully disclosed.
So... ya think getting a commission for each click-thru sale is a "material connection" that "might materially affect the weight or credibility of the endorsement"? By, say, making these "associates" write overly positive reviews to increase the number of sales and, hence, the commissions they get? Hmm... ya think?

Watch out, Rocket Languages. It looks like the FTC might have you in their sights.

Links:
Guides Concerning the Use of Endorsements and Testimonials in Advertising [Code of Federal Regulations]
FTC Publishes Final Guides Governing Endorsements, Testimonials [Federal Trade Commission]
Celebrities face endorsement crackdown [Financial Times]
FTC: Bloggers, testimonials need better disclosure [Yahoo News]

1 comment:

  1. I don't know man, it seems to me you have problems selling your own stuff in a normal way, that you need to throw stuff over another one's business... very weird.

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