The FTC's guidelines for endorsements in social media went into effect on Dec. 1, 2009, and there has already been a handful of high-profile controversies surrounding the use of disclosure in tweets and posts. With questions swirling about what requires disclosure and what constitutes compensation, not to mention fears about fines or bad press, many brands are shying away from social media altogether.
But let's take a deep breath. As an industry, social media is evolving, and we're all trying to find our footing in this new world. However, we shouldn't let fear of the unknown prevent us from taking advantage of the enormous opportunity before us.
Hitting the audience's sweet spot
Sponsored conversations (blogs and tweets) guarantee placement and coverage. They drive initial awareness and create demand. Sponsored tweets and posts can be extremely persuasive, since celebrities and bloggers have already cultivated a relationship and emotional connection with their audiences. A March 2009 report from Forrester Research found that sponsored conversations fit a sweet spot between PR and advertising and will become an integral part of the communication mix for marketers.
So, how can brands take advantage of the benefits of sponsored conversations without falling prey to the pitfalls? For starters, it takes a close understanding of the guidelines, along with a well-defined process and a little common sense.
The revised guidelines specify that social media users must properly disclose any "material connections" they have to a brand or product they write about. Typically, the material connection is pretty cut and dry -- someone receives money, products, gift cards, travel, etc., in exchange for a post or tweet. Other scenarios are murkier, particularly when a paid spokesperson independently raves about their sponsor's products outside their contract. After all, celebrities are people and have their favorite clothing brands, food, beauty products, cars, etc. In most cases, disclosure issues result from harmless mistakes -- without any malicious intent on the part of the spokesperson or sponsor.
However, even an innocent misunderstanding can have significant consequences. And it's safe to assume that the majority of penalties (whether fines from the FTC or public backlash) will fall on the brand, not the blogger or celebrity. Therefore, as a brand, the onus is on you to educate your spokespeople on the new guidelines, as well as have an effective process in place to check compliance.
For the grey areas, it's best to err on the side of transparency -- at least while things are still taking shape in the social media landscape. Specify that celebrities should always disclose their relationship with your company, and make it part of their contract. Of course, when you're dealing with Twitter's sparse 140 characters, this is easier said than done. A simple "#ad" at the end of the tweet works, as well as weaving the relationship into the text, such as: "So excited for my sponsor's new XX. It's coming out next week!!"
As you move forward in sponsored conversations, you should ask yourself (or your agency) these questions: What is your code of ethics and disclosure policy? How do you educate your spokespeople on these policies? How do you monitor compliance? How do you check for proper disclosure?
Perhaps this approach is overly cautious. But, erring on the side of transparency will help prevent any flare-ups that can damage the relationship of trust between the celebrity, fan, and your brand. And if your product and brand are relevant to the spokesperson and their audience, sponsored tweets will be met with true interest and not be dismissed as spam.
At the end of the day, it's important to treat this new media seriously, just like any other initiative within your organization. But as long as the right procedures are in place, there's no reason to avoid or delay your entry into sponsored conversations. After all, these new technologies offer an incredibly scalable and cost-effective way to reach and connect with your audiences.
Ted Murphy is CEO of Izea.
Want to hear the latest from this week's iMedia Brand Summit? Follow the conversation on Twitter #iMediaSummit.
