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Bloggers to be Regulated: Wall Street Journal News…A (long) Must Read!

Submitted by Sara on October 6, 2009 – 2:58 pm12 Comments

Hey Everyone… Been real busy with work and the family the last few days so I have been spending allot of time trying to catch up…. Hope everyone is well!


At work today a fellow co worker (The only one who knows about my blog) asked me if I saw what was in the Wall Street Journal today…. I read and thought it was interesting so here it is to share with you!

Long Read… But lots of good stuff! Share your thoughts!

Article Title: U.S.Seeks To Restrict Gift Giving To Bloggers By: AMY SCRATZ AND MIGUEL BUSTILLO WASHINGTON also —Jessica E. Vascellaro, Geoffrey A. Fowler and Noniaan Merchant contributed to this article. (online version can be found here or Newspaper Clippings saved here pg1 and pg2)

The government wants to make it a little harder for bloggers to shill products online for fun and profit. New guidelines released by the Federal Trade Commission say bloggers must disclose any money or freebies they receive in exchange for writing product reviews ,a fast-growing and loosely regulated way for companies to market everything from diapers to movies. The movies an effort to apply the same rules that already cover broad cast stations, newspapers and magazines to the Wild West marketplace of the Internet.

Separately, the FTC also up dated its guidelines for celebrity endorsements, saying that celebrities must disclose their relationships with advertisers when making endorsements outside the context of traditional ads, such as on talk shows or in social media.”It also eliminated one loophole used in many diet and fitness ads,which allowed marketers to massive weight loss by some subjects as long as they included the disclaimer “results not typical.” In the future, the FTC said, those testimonial ads will also have to include some information about what the typical weight loss might be.

The question of how and whether bloggers should divulge their relationships with companies has been hotly debated in recent months. It is a particularly controversial issue online, where the traditional division between editorial and advertising found in newspapers and magazines is harder to maintain. As blogging has grown, more users are opening on topics ranging from their jobs to their dinner on social-networking and other Web sites.

Big companies are increasingly using these forums to build buzz, sending bloggers products to review or even helping them host parties to encourage others to try their wares. The new FTC guidelines represent the latest in a series of efforts by the government to respond to the needs of consumers online.

Congress is mulling legislation to regulate targeted advertising online. Meanwhile, the Federal Communications Commission is looking at how to adapt its children’s TV rules to cover online videos.“We look at it from the perspective of the consumer and the principle being that a consumer has the right to know when they’re being pitched a product,” said Richard Cleland, assistant director of the FTC’s advertising-practices division. “It doesn’t matter whether its online mail or Twitter or someone standing on a street cornet-.”Some First Amendment advocates worry that the guidelines could represent a restriction of free speech.

They point out that while the FTC has long regulated advertising claims in traditional media, the agency generally has allowed publications to police themselves when it comes to editorial content. For instance, newspapers generally prohibit reporters from accepting gifts from a company they write about to protect their credibility with readers. It is “good journalism” to fully disclose your potential influences, “but that is not the government’s business to regulate, “said Gregg Leslie, the legal defense director for the nonprofit Reporters Committee for Freedom of the Press. “It is a matter of ethics, not a matter of law!’

The agency, which last updated its endorsement guidelines nearly 30 years ago, said it doesn’t seek to regulate all online reviews or discussion of products—only bloggers acting on behalf of advertisers or agents. The guidelines are supposed to offer advertisers clarity about what they must disclose to consumers. The new guidelines come after consumer complaints that bloggers have been writing positive reviews of products they have received as gifts, or in exchange for payment, without disclosing those relationships to readers, and that companies were increasingly relying on the practice to create buzz online.

In 2006, for example, Microsoft Corp. sent Acer Ferrari Laptops valued at more than $2,000 to dozens of bloggers as it was launching its Vista operating system, which inspired a debate about the ethics of accepting such a gift. Microsoft representatives at the time said the company didn’t expect to gain favorable coverage in exchange for the laptops. Ford Motor Co. recently gave blogger Jessica Smith a Flex crossover vehicle for a year, plus a gasoline card, after she wrote a favorable review of the vehicle, calling it “love at first sight…The Flex also proved to make me feel safe and secure while bringing out the exciting and rebellious side of me!’ A Ford spokesman confirmed the arrangement earlier this year.

Bloggers and others who are paid or given freebies to promote products online will be required to offer some sort of written disclosure for readers, the FTC said .The guidelines reaffirm that making false and misleading claims about products in print broadcaster on the Internet violates federal law. They also clarify that advertisers and publishers can be held liable if a sponsored.

If a blogger makes false or misleading statements about a product. Enforcing the guidelines could be difficult, since the agency has limited authority and staff. There are no fines for violating the guidelines, FTC officials say, although bloggers eventually could end up in court if they don’t stop violating the guidelines. The FTC’s decision is likely to be a boon for companies that sell internet advertising and the agencies that advise them, giving them a shot at money that was previously going directly to bloggers.

Sarah Hofstettei; senior vice president of emerging media and client strategy for 360i, a digital-advertising agency, praised the decision for restoring “common sense to a nascent form of marketing.”Ted Murphy, founder of IZEA Inc., a business that connects bloggers and corporations for the purpose of paid “sponsored posts, “said the guidelines could have the most impact on public-relations firms and companies that give bloggers free merchandise.

The FTC regulations target such bloggers as Christine Young of California, who parlayed a personal Web site detailing her experiences home-schooling her six children into a significant commercial enterprise. She is one of the Eleven moms, a cadre of bloggers organized by Wal-Mart Stores Inc., who receive free merchandise from the retailer’s suppliers. Ms. Young said she has toughened her standards and discloses the relationship when she writes about the items.“The brands and companies directly working with bloggers need to be held accountable, “she said. “While sonic companies may choose not to work with us now, I would much rather work with companies that wanted us to be open in the first place.

”The new guidelines “can only assist bloggers” in convincing readers they are trustworthy, said Tricia Haas, the 31-year-old owner of blog site Momdotcom. She said she always discloses receipt of free products from companies, adding that freebies don’t affect her reviews. Ms.Haas noted that she posted a negative review Monday for a cake making machine a company had sent her…

The End:)

 I definitly have lots to say about the above but im sure you are tired of reading by now… Im sure there will be lots more time to discuss and share opinions with the upcoming changes…

About the author

Sara wrote 571 articles on this blog.

I am blogging from San Francisco, CA. I love Makeup, Skincare and Beauty in general. Reality TV and Lifetime movies are my favorites! Want to know more? Click on the About Me tab at the top!! Xoxo! Sara

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12 Comments »

  • Rai says:

    I read that yesterday.
    I have no problem saying I got something from a Company.

    This should be directed at YouTube… too many girls are lying on there pretending they purchased items. That's what it seems to be all about these days on there. Smh!

    [Reply]

  • I know what you mean! Honeslty I am rarely on you tube and if I am there I am looking at tutorials. I honestly have never watched a product review by video. I like reading all the deets! lol.

    Its funny when I read all these things.. I think, who does this apply too?? lol… All the blogs I read.. which are alot… def are honest (from what I believe) in the blogosphere!

    [Reply]

  • This is really just ridiculous to me. Granted, I know that there are some people out there that will give rave reviews just because they received something as gratis. I however, am not one of those. 99% of the products I review, I've purchased. The small amount that I have gotten free, I always give an honest opinion on. It just so happens that I've liked what I've gotten. Plus, I give pros and cons, and ways to go around the cons…like tips on usage. As for website reviews, like when I did one for The Skinny, I didn't receive anything for it and I'm not even getting anything as publicity for my site. I did it because I felt that it was a good concept.

    Plus, most of the time I say I received something, because I did in fact "receive" it, regardless of whether I ordered it or was gifted.

    But…whatever. I hear this isn't in effect until Dec. 1. But I suppose I have no choice but to comply. Ugh.

    I could go on but I'll stop now. lol!

    [Reply]

  • I know what you mean! I feel the same way you do! I understand it from both sides.. I feel like I want to know all the details on if the item is bought… but then.. will I trust the opinion as much even knowing that? I dont know. I think its argument on whats what could go back and forth forever

    I think pros and cons are perfect. Especially because even if the reviewer doesn't like it doesn't mean someone else might… It all goes back to being a smart consumer!

    [Reply]

  • Lydia says:

    How would they know what's real and what's not?
    Do we have to photograph our receipt as well as the product now? So that when we have no receipt they know we've been given the product? Oh come on, this is far beyond ridiculousness.

    Also, I must point out why should I follow rules made by an American commission if I am Italian and the Internet should not be regulated by one nation's rules? Shouldn't they form an international commission before making rules that apply to the WORLD wide web? Mhm…a penny for your thoughts!

    [Reply]

  • rhaindropz says:

    i think there is nothing wrong for a company to give freebies to bloggers..

    also, some blogger helps consumer on info's about any product they have tried and "sharing it is not a crime" they also helps other consumer on what product/item will suit their complexion.. budget and availability of products in anywhere stores

    here in the philippines i haven't seen freebies to try out =( if there were any.. i knew it was in a limited area only =(

    [Reply]

  • I'm new to this site, someone on Now Smell This pointed out your blog as someone who is very honest about disclosing freebies, etc.

    I have very strong feelings about whether or not the blogger received an item from a company or not. I feel it is important to know what was sent and if any printed pr materials were included in the swag/pr package. I worked in the cosmetic industry (for one of the top companies), and I know it's standard practice to send out PR materials and gratis on new launches. I also know the gift of gratis itself increases interest, positive feelings for the company/brand/item and reinforces the desire to create a positive review, even if a blogger is NOT being compensated in any other way. I can't tell you how many cases of gratis I've personally distributed, because the numbers are so high!

    So yes, I think it's vital that your readership is informed of who sent what, the types of additional materials enclosed (ingredients and notes list, marketing materials, etc.), and how often you've received packages from a particular company (for example, if LVMH or Coty has sent you 4 packages in 2009).

    Blog readers tend to be a savvy group, and eventually they'll figure out when they're being pitched a product, even if it's done in the 'benign' manner I described above. I think eventually the relationship between bloggers and companies promoting their products is going to phase out. It'll be interesting to see which bloggers are outed as the restrictions continue.

    [Reply]

  • @ Lydia- oh I am curious how that will work for the non us blogs too! It’s interesting to see what happens with all of this!

    @Rhaindropz- I know what you mean! Thank you!

    @All the pretty things- Thank you for your comment. I am honest about everything I post and I really appreciate that someone pointed that out on the site you mentioned. I understand the debate from both angles and as you said toward the end that people will be outed as requirements are put in place.

    Honestly I feel like with or without the restrictions. We all need to be smart consumers. As a blogger I will continue to do things exactly the same as I do now. I feel like ethically I am already adhering to these guidelines so whatever happens wont affect me much. As a Reader/ Buyer I will continue to read multiple opinions on the product in question before making a decision. But I do feel like quite a few people will be impacted. I am eager to see how it all flows down…

    Thanks again for reading and for you comment:)

    Sara

    [Reply]

  • Anonymous says:

    Super-Duper site! I am loving it!! Will come back again – taking you feeds also, Thanks.

    [Reply]

  • Thank you so much! I really appreciate it!!

    [Reply]

  • Raleigh J. golftobasket.com says:

    I be crazy about the useful tip you offer in your post. I will bookmark your blog and have my kid check up here regularly. I am rather sure they will review a huge of new stuff here than anybody else!

    [Reply]

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    [Reply]

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