The Federal Trade Commission (FTC) has issued clarification on new rules designed to force more complete disclosure of payments, freebies, endorsements and product review procedures on blogs.
Here is the FTC file (a PDF) for download. Updated – here is a more current link for disclosure guidelines. The rules take effect on 1 December 2009 and involve fines of up to $11,000 for violators. Yes, of course enforcement seems impossible, but the rules are there.
I think this will have an impact on tourism industry press trips/”fam” (familiarization) tours, which some (like UK blogger Darren Cronian) consider not much more than blogger payola.
From a CNN/Money article on the FTC guidelines:
“The test here is, if the relationship were known between the blogger and the advertiser, would that affect the credibility of the endorsement?” [emphasis mine] FTC assistant director of advertising practices Richard Cleland told CNN. “That question has to be determined on a case by case basis. What we have produced is a general guidance that says in certain cases receiving a free product is not any different than being paid directly for an endorsement.”
Is a free press trip/fam tour – with lodging, meals, attraction entry fees and transportation all provided by a DMO (Destination Marketing Organization) – considered “payment in kind” and does going on such a trip and writing positive words about what you experience there a form of paid endorsement?
My personal belief….you bet it is.
Other writers and bloggers disagree vehemently with me, and they say that they can maintain their objectivity on such trips. That’s great; more power to them as long as they disclose. The press trip model works well for a lot of interest groups and I don’t see the market for it going away, although I’m certainly not the first writer to feel uncomfortable about it.
I personally have a harder time with the vaunted objectivity goal, because while it’s easy to write superlatives when you have nice experiences, it is much harder to be critical when your experience is lacking. What ends up happening is that most writers simply don’t write about “the bad stuff,” out of understandable concern and respect for their kind and generous hosts.
The problem is – just like making no decision is, in fact, a decision – it is in those unwritten posts, those criticisms left unsaid, where at least some of the travel truth lies. I addressed such issues in detail in one of this blog’s most highly-trafficked posts: Are blogger fam trips a good idea, or are they Jurassic PR?
I’ve been on three press trips myself: to Williamsburg VA, Hutchinson KS and to Hawaii along with my son. They were well-run tours, I enjoyed myself and I met many marvelous, hard-working tourism professionals. I disclosed my compensation for each trip to the best of my ability, although I probably need to go back and re-check all of my posts (on two different travel blogs) to make sure I was clear, and add a disclaimer if I wasn’t.
Here’s one version of what I put on every post from Hawaii: Just So You Know Disclaimer: The Hawaii Tourism Authority through Cilantro Media is paying my way to Hawaii, and also paying most of my expenses while I am there including lodging. I am contributing to my son’s expenses. The point of the trip is to bring experienced bloggers and communicators to the islands to talk about what we see; my primary focus will be on travel with kids. No one has told me that I cannot post negative information. No one has told me that I must say positive things. I will be as objective as I can possibly be.
After putting a lot of thought into the topic while writing the “Jurrassic PR” post, here’s where I stand right now on press trips:
“For myself; I am willing to consider going on future blogger fam trips, but I won’t seek them out. I will still produce content (print/online articles, blog posts, photos, videos) from the Virginia, Kansas and Hawaii trips, and I will still clearly disclose when my travel was paid for, but I now plan to redouble my efforts to make enough money through my consulting and freelance work so that I can pay for my travel on my own.”
Want to help me in that self-funding endeavor? Go sign up for my social media expertise, along with Becky McCray‘s, on our Tourism Currents membership site. 🙂
I’ve also proposed a blogger ethics panel (Can They Buy Your Voice?) for the South by Southwest Interactive (SXSWi) tech conference in March 2010; we’ll know soon whether it was approved or not. If it is, I predict a lively discussion, which is perfect. The more open discussion, the better.
Meantime, tourism organizations need to take a hard look at how their press trip hospitality is disclosed by the journalists, writers and bloggers that they invite. The days of “wink, wink, nudge, nudge – don’t ask and don’t tell” may soon be over. I’m not so naive as to think that current arrangements won’t persist; I just want disclosure of those arrangements.
Ironically, this means that bloggers now have more stringent disclosure rules than almost any magazine or newspaper I’ve ever read.
Tell me your biases and good deals upfront, and I’ll judge your content worthiness for myself. I’d rather see honest blog posts than pretty magazine words and pictures that came from tourism board hospitality, but no one will confess to it.
“Ironically, this means that bloggers now have more stringent disclosure rules than almost any magazine or newspaper I’ve ever read.”
EXACTLY! I’ve been going on press trips on and off since 1992 when I was on staff at a national magazine (Working Mother). Did we disclose the freebie trips then? No way! Have I disclosed freebie trips (or discounted rates or free attraction admission) in ANY of the print publications I’ve written for since then? Nope. Do I now disclose on my blog – YES. It’s a ridiculous double standard.
Here’s a question I haven’t seen answered anywhere. All the articles say that the “FTC has stopped short” of issuing exact rules on HOW bloggers are supposed to disclose – whether it’s a blanket disclosure policy on a nav bar, or in every single post about a product/destination.
Have any insight?
I didn’t see anything specific in the FTC press release – http://www.ftc.gov/opa/2009/10/endortest.shtm – let me go see what I can find down in the PDF itself.
My disclosures go on every blog post from a sponsored trip, since you never know through which channel someone will arrive at your blog. I also put a disclosure on my Flickr photo sets from press trips, but am at a loss for how to properly disclose on Twitter, on StumbleUpon, on Delicious, on Facebook, etc. That’s one of the things I want to talk about if the SXSWi panel is approved.
For Kara’s question (about what, exactly, is disclosure) Found this after some digging: Disclosure must be “clear and conspicuous” — understandable to the “average consumer.”
For me, at least, a single disclosure policy somewhere on your site may not cut it. I think having it on every related post meets the spirit and intent of the rule.
When the word “payment” starts getting bandied about, you can bet another federal agency will start paying closer attention: the IRS. If Uncle Sam deems what you get as compensation, you’re gonna be liable for taxes on the actual dollars or fair market value of the “in kind” recompense.
Thanks, Kay – I can always trust you to give the eagle-eyed IRS/tax perspective! 🙂
Interesting post, Sheila. As a print and on-line journalist, I’ve mentioned before that it would be wonderful to be paid enough for my articles to not rely on hosted trips. Unfortunately, the on-line travel industry seems to be trending in the opposite direction.
Here’s an example of how I “disclose” on a hosted lodging review,
I think that’s a pretty clear disclosure, and also I appreciate you listing the rack rate of $765/night (not that anyone should ever pay rack rate anywhere – the first words you say are, “Is there a AAA discount?”)
That’s one of the problems with hosted trips….I don’t want to speak for you, but I’ll bet you and I would not stay in such a costly place if it was on our own dime. However, that’s where the tourism bureaus seem to put us on press trips (I know – readers are muttering “Cry me a river!” right about now.)
Those big resorts employ gazillions of people on Kauai and other places, and the tourism folks want them highlighted, not the rental condos, rental houses or small independent places that a budget traveler might use.
Now, let’s say that Sheraton establishes a long-term, contractual relationship with us. We stay for free at their properties, with the proviso that we write about them when we do (always clearly disclosing our contractual relationship.) Sheraton can also run a banner ad on our blog, for the length of the contract.
We know the Sheraton PR people, and we like their properties, so we agree to the contract. Is that more kosher than one-off spins at random luxurious properties, via a tourism bureau, which keeps a rotating list of properties to use for press trip hosting?
My initial thought is, yes, I’m better with such a long-term contractual relationship that supports my travel writing, but I still need to think it through some more. I would still be trading in my freedom to stay wherever I want for the benefit of free lodging when I’m traveling for business.
We’re all still trying to figure out how to make a living working on the Web.
Oooooh. Great discussion all around. To segue a little… one of the things discussed at Type A Mom conference last month (aimed at mom bloggers, not travel writers) was coming up with creative ways to monetize your blog. One sponsor there said he liked it when bloggers came to him w/ “campaigns” — i.e. your Sheraton idea. For a fee, the company gets not only a display ad, but they get X number of posts through the year (you get comped stays), plus X number of Tweets, FB updates, and maybe a giveaway. That, he says, is much more appealing than just dishing out X amount of money for a display ad on a blog.
Now, where waters get murky for me: I’m a trained journalist. I’ve always had a separation between church and state. Always. Who was buying ads did not dictate editorial at any of the publications I worked for (okay, maybe not the local fluff mag or the local parenting mag that succumbed to advertising pressure).
But now that I am a website owner, lines are SUPER blurred. I do not like the idea of anyone paying me for “sponsored content.” For now, at TheVacationGals.com, we don’t do sponsored posts. That said, I happily accept products to review – and comps for travel – which now I disclose (more on TheVacationGals.com than Uptake.com, since we don’t have a policy there — yet). At TVG, we’ve got a luggage sponsor, who will supply us with gear in exchange for reviews. Will we be honest with shortcomings? Absolutely. But we’d never enter into a sponsorship with a brand we are lukewarm about, so likely, reviews will be positive. The company knows that.
In general I think it IS a whole new world of citizen journalism and “brand evangelism,” and we’re all just figuring out together. As magazines fold and newspapers pay the sports editor to write about his summer vacation for the travel section, we freelancers are trying to make money where we can. Writer/advertiser/marketer lines ARE blurring among blog owners.
I agree “clear and conspicuous” does seem to mean on every post. And I am curious how many travel writers declare free/hosted trips on their tax returns. Perhaps not in past, but now maybe in future?! If so, I envision a HECK of a lot fewer freelancers competing for those press trip spots!
Well, I’m not surprised to see some of the smartest women on the web having an intelligent debate on this topic.
As with so many pieces of legislation, I think the intention here is to weed out the “blogs” that are really just advertisements for diet pills, pyramid schemes, and the like. I actually support that intention, but I think this is a crazy way to go about it. Why should we be held to a higher standard than other writers and journalists? Is the best-selling author who received a six-figure advance to travel the world and “find herself” obligated to disclose the details of her deal, too? And you are exactly right — what about newspapers and magazines? The more content they pull from freelancers and syndication, the less control they have over the funding sources for those trips, too.
We are living in interesting times! Personally, I hope I’ve been clear about my own policies and practices here: http://www.gypsysguide.com/2007/10/word-about-advertising.html
And I will be adding a link to this post as well. Thanks for the insightful work!
I’ve been rereading portions of the FTC guidelines, and I’m struck by another disparity. Book reviewers never have to wait for the book to come out before they get a copy. They are sent review copies weeks — even months — in advance to read and choose to review. The same holds true for tech reviewers and all kinds of other journalists in print media. Will they now have to make disclosure, too? And what of the products and books they decline to review? By your line of reasoning, Sheila (which I don’t totally disagree with), their omissions are just as suspect?
Hmmm… more for me to think about tonight. Cheers!
This is a great conversation. My own opinion is that it’s fine to accept comps as long as they are disclosed. As someone who is often on the other side of this (i.e. giving comps to various customers such as meeting planners), we always *hope* for favorable writing or a favorable opinion, but we know we’re not *entitled* to it. I am always saying a prayer that the customer’s experience is good while he/she is in my care.
I don’t think these things need to be mentioned in every post, as the reader might find that intrusive. But I think of magazines like Newsweek, where they always mention if they have some relationship that might affect the writing of the story. Not always compensation–just anything that they think the reader should know. I always say to myself, “Well, they just disclosed that–then I can relax and enjoy the writing, because if they are honest about disclosing it, I can trust what they’ve written.”
Hi Angela and Carla (and thanks to Kara for more good ideas,)
I really appreciate your thoughtful comments. Most of us of course want to do the right thing, and if we’re ahead of mainstream media in this area….well, it wouldn’t be the first time!
Good point on the tax implications, Kara – that’s exactly what brought Kay Bell (@taxtweet) here to comment.
There is no free lunch.
Sheila: I certainly agree with your basic premise about disclosure–let the reader decide. HOWEVER….
I’m glad that Angela chimed in about books. I discuss books on A Traveler’s Library and always mention when they are supplied by the publisher. But talking about travel that is comped brings up an issue that nobody has mentioned. Since I freelance for magazines that still have the “don’t ask, don’t tell” policy, if I disclose in the blog on travel, then I will not be able to write about that destination for the magazine. The end result of that would be that I would not talk about trips on my blog (since nobody is paying me for that) in hopes that I could place a story in a print publication. This is an extreme example of the problem caused by the difference between blog and print journalism enforcement.
And how about if I go somewhere with an assignment which is paying the freight (not the expenses separately). Otherwise I would not be there. So if I write about the same destination on the blog, do I have to say “I was there because X publication paid me for an article.”
British papers have handled it more sensibly for a long time. They just say “The author of this piece had a complimentary stay at the hotel” or some such. Here, NYT requires that you NEVER have received comps under any circumstances.
And, Sheila, you mention that the tourism offices put us up at classy digs and therefore the budget places don’t get covered. Turn that around. Actually, we could probably afford the budget places ourselves, so that is not a problem. If the 5 Stars were not comped they would never get covered.
I’m a little late to the conversation, i’ve meaning to get back to this. it’s an important one. From a PR perspective, I wanted to chime in.
It does seem the FTC is being very selective, and in doing so, opening a can of worms. As an example, if I were to send a bottle of my clients’ wine to Gary Vaynerchuck to be reviewed on his wine library podcast, I run the risk of him ripping my clients’ wine, or raving about it. It’s a matter of being confident in your product. and being ok if someone out there doesn’t like it. BTW, sometimes he buys the wine himself, sometimes it is sent to him. I’ve not noticed any consistency in his disclosure on the matter, and that’s because he is not regulated.
Having said that, I know when I invite a travel writer to my destination, i run a similar risk. The trip isn’t going to go perfectly, and the writer can choose to share the negative or not. I’ve never placed restrictions in my invitation. (I’m sort of contradicting myself from a comment I posted on @nerdseyeview’s blog this summer, but I’m not running for president, so I reserve the right to flip flop)
In a perfect world, I wouldn’t have to comp anything for the visiting writers – this would eliminate your dilemma, and it would certainly help our revenue! : ) but we know that doesn’t work for your business model. How can you, the writers, possibly make a living if you had to pay for all the travel?
I see the comp more as a way of cooperation, than a bribe. I’m sure not all destinations would share my opinion. However, as a traveler and reader, when I’m reading someone’s blog about another destination, i of course want to know its not tainted due to comped travel.
Thanks for bringing this up again, Sheila. Nerve! Touched! I always cackle when I see a staff writer’s “ethics” disclosure stating that they don’t accept freebies–as if being a paid staff writer with an expense account, which was probably billed at a discounted press rate, makes their review more useful or the experience they received less polished than the lone wolf writer trying to compete online and on their own dime.
Also, what is the deal with disclosing stays on press rates? Are we also supposed to disclose that, “While last week’s review was based on a completely free stay and is therefore 100% untrustworthy, this week’s was paid 45% out of my pocket and is a therefore a corresponding 45% unbiased”? Or is paying a significantly discounted rate still considered to inspire as unbiased a review as paying the rack rate?
And why is it just “blogs” under attack, and not websites in general? Hmmm… and why isn’t anyone discussing what really matters–writing useful, engaging reviews that will actually help the readers?
I noticed the link to BlogwithIntegrity.com at the top of the post. In the interest of full disclosure, I am one of the co-founders of the Blog with Integrity pledge, and have been studying, writing and talking about the FTC guidelines for a few months now.
The issue at hand isn’t whether bloggers can be objective if they are compensated, hosted or provided with free product. Or that writers in traditional media are somehow more objective or ethical.
It’s whether the average consumer — the reasonable person — will understand that the reviewer may have been compensated and if that knowledge would change the consumer’s perception of the review or story. The FTC believes that the reasonable person would not expect personal bloggers to be compensated and knowledge of the relationship might affect perception of the review. Hence the need for disclosure.
It does not believe that similar disclosure is required in mainstream media. The document states that the FTC believes that knowledge of who paid for the product would not change the reader’s perception of the review, but the FTC stand could change its stand if it learned of a material relationship between writer and company. Why doesn’t it believe the disclosure is required? It’s not explicitly stated but I think it is because the reader ALREADY assumes that the journalist got the review product or trip for free, in one way or another. Either funded by the publication or as a comp. Mainstream media also has pretty strict review policies to protect themselves from abuses and maintain the wall between editorial and advertising. We implicitly rely on them when we read the daily paper or our favorite magazine.
I posted part one of my updated take on the guidelines yesterday and plan to post a pretty detailed analysis over the weekend.
I presume that if you pay less than fair market value (which doesn’t mean rack rate — if they could fill the room at rack rate, they wouldn’t have offered it to a writer at a “media rate”, now would they?) then the difference between fair market value and what you paid will be considered a gift by both the FTC and the IRS.
The FTC hasn’t given much guidance on the new rules, but the logical place to look for precedent as to how they might be interpreted would be the longstanding disclosure rules for
financial journalists. It’s perfectly legal and considered ethical to own a stock you recommend — even if you write for the New York Times — but you have to disclose it in anything including articles, radio appearances, conference presentations, etc.
I’d much rather see the rules framed in terms of disclosures than prohibitions on what can be published. And I think the larger effect will be on disclosure of affiliate links to recommended hotels, tours, cruises, etc., rather than on disclosure of sponsored or subsidized travel.
There’s more discussion in my blog:
And my own (new) “Disclosures and Disclaimers” page is at:
One of Sheila Scarborough’s paragraphs caught my eye:
“Now, let’s say that Sheraton establishes a long-term, contractual relationship with us. We stay for free at their properties, with the proviso that we write about them when we do (always clearly disclosing our contractual relationship.) Sheraton can also run a banner ad on our blog, for the length of the contract.”
That’s EXACTLY the kind of thing the FTC is targeting, I’d guess: Paid advertorial, as opposed to editorial coverage that may or may not have been influenced by the fact that the writer was traveling on an expense account (his or her own, or someone else’s). For one thing, the evidence is clear: If the writer is being paid to cover the topic, the coverage is likely to be viewed as an “endorsement”. Second, the government can regulate advertising (including advertorial, presumably) but–under the First Amendment–can’t regulate a free press.
Thanks for the continued thoughtful comments by Vera Marie, Lisa, Shelly, Susan, Edward and Durant – your analyses really add to the discussion and I appreciate them very much.
Pay-my-own-way anonymity looks better and better to me; awaiting my winning lottery ticket to support it. 🙂
OR, toss it in and agree that I’m an advertorial copywriter, with commensurate pay. Oh, wait, that takes away my “authentic blogger’s voice” that all the marketers are after.
As a blogger about to participate in a fam trip in three weeks, I’d like to ask if FTC rules only apply to bloggers based in the US? I live in Dubai, United Arab Emirates.
I’m no expert in the FTC but its focus is on US trade issues and false advertising by US companies. Most reputable bloggers worldwide have always disclosed freebies, and you’ve been around for awhile, so just keep doing your transparency thing and you should be fine.