Oct
12
On Disclosure. And Shiny New Things.
If you haven’t heard, the Federal Trade Commission recently issued a rule that says bloggers and social media users could get into Very Big Trouble Indeed if they don’t disclose blah blah blah. I won’t bore you with the (really quite shockingly boring) details. Basically, if I tell you to go out and buy something, I have to tell you if I they paid me off to tell you. Payoffs can include free review copies or nights with hookers or a bottle of Veuve Clicquot.
My totally unsolicited opinion
This is very good news for people like me, Brian Clark, Rae Hoffman and Dave Navarro who have quite happily been disclosing our relationships with the companies we promote for years. We say things like, “You’re goddamn right that’s an affiliate link” or “I get fifty bucks every time you buy one of these babies” or “the nice people at Pretty Underage Girls, Inc were kind enough to send me a free copy”.
Our audiences like us enough that not only will they accept this, they actually go out of their way to purchase stuff because of this. Handy little side bonus of providing cool content to people for years. They’re nice to you.
This is bad news for people who overpromote or try to hide their relationships or for whatever reason don’t have the type of blog where they can say stuff like that.
Will it be inconvenient and cumbersome? Sure, sometimes. But usually, it’s not going to be a big deal.
I think the real tragedy here is that it so clearly targeted bloggers. That’s pretty lame. But whatever.
The Big Flaw
Whenever I come out with a product, I try to remember to give a free copy to all of my friends. Some of them subsequently buy a copy anyway. Some of them buy a copy before I get a chance to send them a free one and then I have to send them refunds. (Sonia Simone, I’m talking to you.) Most of them never even open the file.
But I don’t do it so they’ll say nice shit about me. They were going to do that anyway. I do it because it’s polite. And that’s why pretty much everybody I know does it. Because it’d be rude not to.
But the reason this will have pretty much no bearing on any blog worth reading is this:
The greatest currency on the internet is one they’ll never be able to legislate.
Money and free products are Mickey Mouse bribes compared to the much bigger currency of reciprocity. That’s the real value, and it’s one they can’t legislate. Ha ha.
The IttyBiz Disclosure
You can safely assume I pay for absolutely none of what I review or recommend here. I pay for Mark Silver’s stuff because he’s so nice I don’t have the heart to ask for comps. (He still gave me a free copy of Unveiling the Heart of your Business, though.) I paid for Teaching Sells when it first came out because I wasn’t big enough yet to deserve a free slot. I think I paid for Havi’s Emergency Calming Techniques with some kind of barter.
Other than that, it’s pretty much all comped.
The good news for YOU here is that if IttyBiz A gives me a free ebook and Ittybiz B gives me a free ebook, I have no financial motivation to promote one over the other. Unless there is a startling difference in their affiliate payout structures – and there never is, by the way – I’ll sell 100 of A’s product or 100 of B’s product and it’ll net me pretty much the same amount of money. So I may as well promote the one y’all are going to like better. No reason not to.
You should probably also assume that every link is an affiliate link. Most of them aren’t, but this way you won’t feel all icky inside.
P.S. Your chances of getting a favourable review from me are directly proportional to the amount of Veuve Clicquot you send. I’m okay for hookers right now, but you can never have too much champagne.
P.P.S. You think I’m joking.
Oh! And one more thing!
If you’re reading this in your inbox or RSS reader, you should probably come see the new IttyBiz. It’s pretty fucking hot, if I do say so myself. You can check out the first of our Diamond in the Rough series of $7 classes, the gorgeous new store, and nested comments. I don’t really know what a nested comment is, but I am assured by web designer extraordinaire Naomi Niles that we have them.
Amen to that. Nice place you got here.
Look at me! I’m nesting!
A nested comment is that little “reply ” link right under my comment. Clicking it will “nest” the reply specific to me (or whoever) so that the commentors can carry on a conversation or endless replies don;t get lost.
In short: it makes you look way hotter & smarter & stuff.
Wait, Sonia does that, too? I thought it was just me.
The more challenging thing for me as someone who does reviews and such is finding a way to disclose the affiliate without it being all awkward. Some people talk about hookers and champagne…and others…well, they’re still trying to figure out their style on that front.
I’m actually more curious about how this will affect twitter use, since space on Twitter is a premium.
Now if we could only get politicians to stop making rules they can’t enforce. I think I’ll go whine on the Huffpost about that now.
Can I just latch onto the bit where you said “it so clearly targeted bloggers”? That pisses me off mightily. There are freaking *newscasts* where they’re doing product placement, and it’s not adequately disclosed.
I already disclose anything I get, for the same reason you do. But it bothers me that now I’m being told *I* have to do it, but TV and radio and newspapers aren’t covered the same way.
It’s almost enough to make me want to thumb my nose at the regs, and see how close I can skirt the edge of legality. I won’t, because it’s actually bad for trust and reputation, but for people who want to play that game it’s hard not to see loopholes and exceptions all over. I suspect it’s mostly honest players who will get nailed for slipups, not the people actually abusing their readers’ trust.
PS: Now that you’ve got a new look, could you think about RSS for post comments?
The feed for all comments is here:
http://ittybiz.com/comments/feed/
If you want to keep track on specific posts, there’s the handy “notify me of follow up comments” checkbox at the bottom. But that’s after you leave a comment.
Oooo wait – I went to http://ittybiz.com/on-disclosure-and-shiny-new-things/feed/ and got a comments feed just for this post.
(Man, I love Wordress)
Congrats on the redesign! The old site was not up to par.
Champagne is on the way. All revenue from my affiliate links goes to spoil the hell out of my friend’s daughter. :D
Fantastic post.
What really mystifies me about this whole FTC thing is… who do they think they’re protecting? And from what? Skeevy people who are getting paid to shill for something are still skeevy – no matter whether they put something down at the bottom of their post in 2 pt font or not. (And, since they’re so skeevy, are they really likely to follow this law anyway? And… does the FTC really have enough people to enforce this on the internet of all places?)
Mystifies me.
Also, the redesign rocks my world.
I absolutely love the redesign Naomi. Or should I say, Naomis. :)
Oh, and affiliate links… most of us love that we’re helping bloggers when we buy stuff we’d buy anyways.
Love the new clean look of your website.
As for the reviews, if you review something you already think is great, it’s easy to say you’re an affiliate.
On the other hand – reviewing something you don’t like and including an affiliate link is… just plain dumb!
I think it’s about time someone required disclosure of a reviewer/seller relationship to the product they are reviewing/selling, it’s a good thing.
Oh! BTW – Does the FTC have authority in Toronto now?
Maybe I’ll just move back to Newfoundland.
Like many bloggers, you have misunderstood the most important part of the FTC announcement – the removal of the safe harbor for disclaimers.
The disclosure issue is trivial, but the new guidelines on earnings claims are going to end up biting someone hard. Specially for people like “you, Brian Clark, Rae Hoffman and Dave Navarro.”
I cannot offer legal advice to those outside of Ontario, but I can advise that you get some experienced advice from a franchise/business opportunity attorney.
You might this of use:
http://www.bizop.ca/blog2/due-diligence/testimonials-and-disclaimers.html
Michael, I assume you mean the issue about disclaimers and testimonials that don’t represent the middle of the customer experience? Frank Kern did a good post on it. You’re right, it’s a good one to know about. It affects all advertisers, not just bloggers, as I know you know.
Back to Queen Naomi, I thought the old design was nice, but this one is super deluxe gorgeous.
Also, if I waited for you to remember to send me free stuff, you’d be all out of pixels by the time you did. Not that I’m calling you a gigantic flake or anything.
First, I’ll tell you where you can put your pixels, Miss Flaky McFlaky pants.
Second, what I think is going to be interesting — perhaps simply because I’m a geek — is the very real issue of semantics, and how that’s going to play out with the sleazebag crowd. Things like “typical”.
Is “typical” supposed to be synonymous with average, median, or within the bell curve? For the vast majority of products, the average result is going to be far higher than the median result, skewed dramatically upward by the high achievers. If one person makes $100,000 and nine people make nuthin’, the average is $10,000, but the median is zero.
And are we dealing with literal definition or common usage? “Average” is still VERY misleading if your basic Wal-mart shopper thinks it means “typical”.
Even using a mathematically accurate average is still in spirit a big fat lie, as “average” is usually not remotely close to typical.
Naomi writes: ” what I think is going to be interesting — perhaps simply because I’m a geek — is the very real issue of semantics, and how that’s going to play out with the sleazebag crowd. Things like “typical”.”
Uh, no. You don’t understand the FTC litigation process. The burden of proof will shift to those making claims who don’t collect data.
Sonia;
The FTC picks litigation targets based upon a cost benefit analysis.
They know that certain affiliate marketers will be making claims about how much money you can make using their programs, but put a disclaimer at the end of their pitch.
With the safe harbor provision, the marketer selling a business opportunity, the payment of money for the chance to earn more, who put on a disclaimer increased the cost of litigation for the FTC. The FTC had the burden of proof.
Now, without the safe harbor provision the marketer is going to have the burden of proof. Naomi talks about different meanings of “typical”, but the burden of proof will now shift to the marketer to show a) they have information about what is typical for their consumer, and b) they disclosed it prior to purchase.
For the most part, this will be a slam dunk for the FTC because many marketers don’t even collect data which would allow them to substantiate what the typical consumer experience is.
No data, no testimonials. Testimonials and disclaimer with no date, big fine.
Re Frank Kern;
Sonia, I read and commented on Frank’s observations about the FTC.
But, he clearly doesn’t get it.
Here is one of his affiliate sites:
https://infomillionaire2.com/order.php?affiliate=0#null
Check out his earnings disclaimer.
Fails the test.
Wow. I love the new site design! It looks so much…bigger than the old site.
I also like the comments section. Makes it much easier to see who’s saying what, and I like the reply feature.
Overall, very shiny. :-)
LOVE the new design! Excellent!
I do have affiliate links that I don’t disclose – just because it would totally confuse my readers. When I mention someone’s name on my blog and I want to link to them I often use an affiliate link. But it’s not related to a specific product or program and I’m not promoting anything. So if I wrote Naomi Dunford (hey guys that is an affiliate link) they would say HUH? I THOUGHT IT WAS A LINK TO NAOMI’S SITE? Seems overly complicated to explain the whole structure of affiliates, that although I’m only linking to the blog you may some day buy something and I will maybe or maybe not get a commission, blah blah.
Anyway I am just whining, clearly there is an easy answer which is just to stop making those links affiliate links.
Swell post,
swell-er facelift,
and nice work salutes to the two Naomis and the unsung hero that Jamie must be…
and I think TYPICAL needs to mean “majority” of whatever is being described, because that means that more are “like this” (typical of) as titled. And there’s noting typical about you, dear.
WOW!!!! Love the shiny new thing… Spiffo. :)
“The greatest currency on the internet is one they’ll never be able to legislate.”
Nice. And like so many things in life that are beyond price.
Hats off to design Naomi….and a tip of the Veuve to you Naomi. I’ll cancel the hookers.
Michael,
I don’t mean the semantics of the FTC. I understand what they’re saying. I’m interested in the semantics of sleazebag internet marketers and what they will do to try and sneakily get around the FTC. I’m not saying they’re going to succeed. I’m not saying anything about the burden of proof.
I’m just really looking forward to some of the spammy blogs having a word-choice field day saying X means A and Y means B to try and justify breaking the rules.
What are your thoughts on the Canadian issue? According to Canadian news reports, it’s a US agency that has no jurisdiction over Canadians. Thoughts?
The FTC routinely sues in US Courts and Canadian Courts telemarketers residing in Canada.
In some Canadian cases, the FTC loses. But, the costs of the legal defence is enough to put many marketers out of business.
The FTC, unlike the Canadian Competition Bureau, is aggressive and has significant litigation experience.
Well look who went all Hollywood! You go girl! I love the new sight design. Bright,white,minimalism is what I love.
Hi Naomi
Great site! Looking good. Just a quick question, when you first started, did you use any affiliate links and announced that they were affiliate links? Or did you only incorporate affiliate links when you got bigger?
Thanks heaps.
What a disclosure. :D
This disclosure article give new sight for me according this FTC new rule. FTC new rule win to win solutions for costumers and seller indeed.
Love the shiny new site.
Regarding disclosure, I am NOT a lawyer, but I think the big hurdle is not so much acknowledging affiliate links (easy enough), but the removal of the safe harbor. What is the appropriate measure? The average? The median? And for how long? The past year? Forever? They may need to clarify this some more.
Also, I just checked out the “Diamond in the Rough” course, and while I haven’t heard it, I know Pace and Kyeli are awesome.
Full disclosure: I know them from triiibes, but I received no money, flowers, or chocolate for making this endorsement. ;-)
I haven’t done anything on my site yet regarding disclosure. I’m just waiting for the other shoe to drop so I can work within the specifics.
I’m just hoping that the FTC does actually release another statement before the December 1 deadline.
Naomi + Naomi, the new decor looks great. Love the clean understated look.
I’ve been thinking about having a disclosure page linked on the top bar with all of my affiliate disclosures. Just a static page with a recap of everything I have reviewed or linked with an affiliate link or been comped. That way if anybody ever wonders, they can go look at that page. And maybe they’ll see something else that catches their eye and click through…
Wanted to comment to say thanks everyone for all the nice comments both here and to me directly about the new design. I’m so glad you all like it and find it easier to use!
I never understand why things have to be weird around getting paid for stuff. We all have to eat and if you promote something you like and can get paid for it too, what’s wrong with that? As long as you are honest about it, it’s not like you’re forcing anyone to buy anything.
The hard part is figuring out when this ‘affiliate’ stuff crosses the line into into a giant daisy-chain circle jerk.
Sort of like when Brian Clark began pimping for con artists like Clayton Makepeace. That’s when Seth Godin called him on it. “What kind of tribe are you building here, with dregs like that?”
Personally, and it’s just me, but bloggers always lose a notch of credibility when I see this reciprocal crap on their blogs. It puts a stink on it for me.
Not that you asked.
@Anton;
You need to put a links backing up your assertions that a) Brian was “pimping” for Makepeace, b) Makepeace is a con, and c) Seth Goodin called Brian out on it.
Otherwise, you run the risk of appearing to be ranter.
Or someone who is, um, not familiar with the truth.
Brian’s going to be telling the actual story at Blogworld tomorrow, for those who are curious. Dunno if they’ll stream the talks like they did at Izea. If so, please twitter about how thin and cute I look.
I also have to add a PS because I can’t let anyone think that there’s anything about Clayton Makepeace that’s “dregs.” He had nothing to do with the actual story. I’m not his biggest fan, he’s a little old school for my taste, but he’s 100% the real deal and his product is first rate. I have nothing but admiration and respect for master direct response copywriters like him, even if I take what they do in a pretty different direction.
And also, spreading stories and getting every single material fact wrong does not make you look cool. It makes you look the opposite of cool. Just sayin’.
Many people still believe that affiliate link promotions are overly biased because of the financial incentives for the promoter. “Of course, you recommend it, you are getting paid for it.”
However, biased or not, affiliate links work. Two of the biggest ones the come to mind are Aweber and 37signals. Those services are promoted by everyone, because there is a decent affiliate commission.
On the other hand, I still have to believe that recommendations without a financial incentive are probably more reliable. Indeed, Seth Godin mentioned that he can sell other authors’ books more effectively then he can his own with a blog mention.
A blog needs to have a lot of trust built up with readers to pull off self-serving promotions.
I think that a lot of these promotions are becoming that “giant daisy-chain circle jerk” that Anton Crocek mentions in his comment.
Bug report!
After signing on the Marketing for Geeks the thank-you note is still in old ittybiz style :-)
Just FYI.
Congratulations to Naomi and Naomi on the new site redesign. It’s clean, elegant and still fun, which is a tricky combination to pull off.
Michael, while Frank Kern’s earnings disclaimer may fail the test, it’s also important to observe that there are NO earnings claims of any type on the page you linked, other than a general statement of how much he and Trey have made in the business.
Since there’s no specific suggestion of any financial return to the consumer on the page, and so really nothing to disclaim, I think you could have found a better example of someone you felt was violating the FTC’s rules.
The new site rocks my socks :) Thanks for all the great advice & your unsolicited opinions are always great!
Cheers
I love the new look – so uncluttered and elegant! Very snazzy. As far as disclosure goes, I’m torn. On the one hand, I can see why FTC felt it was necessary; on the other, I can’t imagine that they have the personnel to keep up with all the work, so how can they enforce the regulations consistently? It seems like feel-good legislation to me – they can feel good about having laws on the books, even though those laws aren’t likely to make a material difference.
Disclosure’s not a bad thing. In fact, consumers are getting smart enough (I think) to smell a rat. And the more data available across the net, the smarter they get.
I too, am looking forward to see how the yellow-highlighter brigade (not that all yellow highlighting is bad) handles the average earnings data. It can be very tough to accurately capture, and to that end, I think time will tell how this plays out. Overall, I would hope that the FTC, when assessing fines, looks at the effort the respective person went through to disclose – and if they made a concerted effort to be factual, upfront and transparent, that matters.
Beyond the blogosphere, what’s not as obvious are some of the product placements in Hollywood. And it doesn’t seem like they have to disclose those connections as clearly. Advertising is everywhere – and as companies fight fiercer battles for attention – and wallets – and as print media loses to other venues, we’ll see more and more entertainment tied with product placements and ads.
As many others have said – I, too, love the new design. Very contemporary and original.