The Federal Trade Commission has decided to set up a fine up to $11,000 on bloggers who are paid to write reviews, but not disclosing it.
The FTC has reconsidered its Guides Concerning the Use of Endorsements and Testimonials in Advertising, for the first time in 29 years. This requires for the blogger who makes an endorsement to disclose the material with the seller. Fines is up to $11,000.
So now bloggers has to disclose payments and freebies they get from companies for reviewing a product.
These new rules and large fines should bring some bloggers and marketers into line. And I think sites like ReviewMe is probably going down – Just to much work.
Details from FTC’s announcement:
“The revised Guides also add new examples to illustrate the long standing principle that “material connections” (sometimes payments or free products) between advertisers and endorsers – connections that consumers would not expect – must be disclosed. These examples address what constitutes an endorsement when the message is conveyed by bloggers or other “word-of-mouth” marketers. The revised Guides specify that while decisions will be reached on a case-by-case basis, the post of a blogger who receives cash or in-kind payment to review a product is considered an endorsement.”
The rules takes effect 1st of December.
I would wish politicians were equally required to tell each time they voted as requested by the lobbyists who pay numerous “bonuses”, free trips and other perks to get their businesses promoted.
But it’s true: two wrongs don’t make a right. Furthermore, people deserve to know when a review is paid for/sponsored.
But politicians aren’t anyway nearly as careful when it’s money in their baskets… 
I think this is great news. There isn’t enough honesty in the world. Maybe we’ll start seeing some ‘real’ reviews now. 
So people that get paid to review or get free products just disclose at the end of the reivew ‘I received such and such product as a freebie as well as $xxx to write this review’ ?
Although I do think clarity and openness is important. Business people do this all the time in the offline world and they don’t have to disclose anything. Anyway, I don’t think this will effect everyone, only people who are members of paid-to-review sites but now this will just force publishers and advertisers to talk to each other more directly and the FTC can’t stop that.
The thing that confuses me (at least in Canada, anyway) is people who are shocked by things like this. You’re supposed to declare all income. People find new ways of making income and feel that they don’t have to declare it. My accounting teacher in college gave us a good way of deciding whether or not we should be declaring a revenue with this simple question: “Did money go into your bank account as a result of your transaction?” If you made money from a business move, you claim it.
The real problem is all these make-money-yourself-online blogging and internet marketing jobs popping up and people aren’t treating them like real businesses. Get your spreadsheets open, my friends.
That’s what I get for commenting on a post when I first wake up. I was under the impression that the post was about disclosing payment received for reviews financially, not ethically disclosing that you were paid to review.
I do agree that it should be mentioned if a review is paid. You can still persuade with a paid review so long as you actually believe in the product. If you don’t, then you probably shouldn’t be reviewing it anyway.
It’s a great idea, but how does something like this get enforced?
There are so many blogs and review sites out there. You even hear of companies openly paying bloggers to endorse their products.
I wish the FTC luck!
Hello, I'm Mikkel Juhl, young blogger. I started blogging in 2007, let's say that I've been around for a while. I'm 14 years old, I have a passion for email marketing, internet marketing, social media and Twitter!
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