In an age of fashion rule breakers and style disrupters, now is the time for legal controls to liberate the consumer. As social media and blogging become increasingly important marketing tools for consumer-facing companies, the Federal Trade Commission (FTC)—tasked with preventing and eliminating fraud, deception, and unfair business practices—has heightened its focus on marketing behaviors conducted by companies through social media, blogging, and native advertising campaigns.
On Feb. 10, 2017, the Federal Bar Association’s Fashion Law Seminar panel “Earning Followers: Influence Marketing, False Advertising and the Federal Trade Commission” will examine social media marketing and endorsements. Companies pour marketing dollars into social media testimonials, paying everyone from Oscar winners to fashion influencers in order to reach customers. The 4th Annual Fashion Law Seminar in New York City will explore the latest FTC cases and best practices as well as new guidelines that call for clear labeling when digital media messages mimic editorial content. Take advantage of early bird rates and sign up today at www.fedbar.org/fashionlaw17.
Photosharing platforms like Instagram change the way retailers sell products and reach consumers. As such, it can be difficult to discern between organic commentary as opposed to paid sponsorship and reviews. We live in a material world, thus recognizing best practices for brands to disclose relationships with influencers that shape social media and blog content is key.
A cautionary tale: Cole Haan endorsed a Pinterest promotion in which users were encouraged to share images of their favorite Cole Haan shoes with the hashtag #WanderingSole for a chance to win $1,000. Arguably, the promotion failed to meet FTC guidelines, as it was unclear to consumers that the pins were incentivized. The FTC sent Cole Haan a formal warning, because people who have been financially compensated by a brand should disclose themselves as paid endorsers.
Similarly, a Lord & Taylor Instagram campaign to tap fashion bloggers to promote a dress may have violated FTC disclosure rules. In the case of the luxury department store, some influencers marked their posts pushing a paisley frock as sponsored content, while others did not, causing confusion among shoppers. The FTC estimated that the bloggers and fashion influencers’ posts quickly reached 11.4 million individual Instagram users, resulting in the dress selling out. Lord & Taylor eventually settled charges lodged by the FTC.
U.S. law requires a certain level of transparency in advertising, which means ads cannot be deceptive, false, or misleading, and failing to disclose a post or a tweet as sponsored or paid for by the brand can be considered deceptive marketing. The FTC states: “If there’s a connection between an endorser and the marketer that consumers would not expect and it would affect how consumers evaluate the endorsement that connection should be disclosed…The same is usually true if the endorser has been paid or given something of value to tout the product.”
Social media can blur the line between whether a speaker is exhibiting an expression of one’s own personal views, or is shepherding a paid endorsement. Vejay G. Lalla (Davis & Gilbert LLP), Laura Brett (Assistant Director, National Advertising Division, Council of Better Business Bureaus), and Ann Schofield Baker (Perkins Coie LLP) will provide valuable legal insight into these and other tech topics at the 2017 Fashion Law Seminar. Register today!
Stacy Slotnick, Esq. holds a J.D., cum laude, from Touro Law Center and a B.A., summa cum laude, from the University of Massachusetts Amherst. She performs a broad range of duties as an entertainment lawyer, including drafting and negotiating contracts; addressing and litigating trademark, copyright, patent, and other IP issues; and directing the strategy and implementation of public relations, blogging, and social media campaigns.