This summer the Federal Trade Commission amended its disclosure guidelines to give it authority to fine any blogger that accepts gifts without disclosing the relationship to readers. As of yet, the commission hasn’t doled out any fines to violators. Which means that many brands are still carrying on with the practice of rewarding bloggers for posts.
Last month, Ann Taylor LOFT extended an invitation to bloggers to preview the stores new collection in return for gift cards to the LOFT. The trouble is, a few bloggers didn’t accept the offer.
Gawker Media blog Jezebel was invited to come down to inspect the new collection. If they liked what they saw (and posted about it within 24 hours) they’d receive a gift card valued at between $10 and $500. Though Jezebel didn’t accept the invitation, and as they point out, those that did are likely in violation of the FTC’s new rules:
“Almost none of the bloggers who typed write-ups and posted grainy
cell-phone photos disclosed their financial relationship — or lack
thereof, if in fact anyone turned down the cards — with Ann Taylor. A
gift card might not be the most liquid form of currency, but it
certainly has monetary value — and $500 is no small sum.”
In the contest fine print was the following wording:
“Please note all bloggers must post coverage from our event to their
blog within 24 hours in order to be eligible…You will be notified of your gift card
amount by February 2. Gift card amounts will vary from $10 to $500.”
This looks disturbingly like pay-to-play and The LA Times took note, calling the effort attempted bribery.
Gifting bloggers after their coverage runs presents a slightly different predicament for discloser in a blog post than guaranteed payments. At the time of writing the post, the blogger hadn’t actually been compensated for it.
As Ann Taylor LOFT told The LA Times:
“Engaging the blogging community is a new way for us to communicate
product information. We put a premium on the editorial media that
covers our brand and we do not incentivize media for coverage. … It
is not uncommon for LOFT to offer contests,
promotions or special offers in-store and through various online
channels to our clients, similar to other retailers.”
But receiving a free shopping card definitely incentivizes people who like the products to write — adoringly — of a company’s products. However, will this sort of example bring the attention of the FTC? Probably not.
The last time I spoke with an FTC representative, it looked like decisions on the matter would all come down to scale. In January, Len Gordon, the FTC’s Northeast director, said that fines would be handled on a case by case scenario:
“It’s one thing if it’s a packet of soap, another if it’s an automobile. It’s going to depend on the particulars.”
And while Ann Taylor is definitely walking a tight line by offering gift cards depending on such strict rules, this sort of stuff happens all the time in print. Magazines run editorial pages full of products gifted to them by advertisers. It’s impossible to say exactly what brands pay for what placement in magazines, but women’s magazines notoriously give favorable coverage to brands that gift them free stuff (and advertize in their pages).
The main problem for Ann Taylor is that this gift was so well documented. And while this specific case may not result in any FTC fines, if this becomes a popular tactic to entice fickle bloggers to make good on their promise of blog posts, brands shouldn’t be surprised to see the FTC poking around. The group isn’t above making an example of an individual to scare brands off of shady practices when it comes to endorsements. As Gordon put it in January:
“If a consumer wouldn’t understand the endorser is being paid to say
that which they say, that’s something we’re concerned about.”