While a slew of social media channels have existed for years, many brands still consistently struggle with the balance of effective engagement and traditional push strategies. One popular option for many are sponsored contests and promotions as they allow some level of “control” on platforms that really remain a wild west environment for brands as consumers can easily create a discussion in a very public manner. However, the control offered by promotions that felt like a safer bet for brands changed recently with the first public warning (in the form of a Closing Letter) of a brand by the Federal Trade Commission (FTC) to Cole Haan regarding a Pinterest promotion requiring users to pin images of its products to enter a contest.
The issue for the brand in this case, and for all brands across any social network or site online, is disclosure and transparency of the connection between an activity and the incentivized nature of that action. Would a Pinterest user potentially create a board of fashionable shoes they liked? Absolutely. If the reason for the board, though, is a chance to win a prize, then they are essentially advertising to followers on behalf of the brand. Based on FTC guidance within its .com disclosures material, social media pins or posts are equivalent to providing an endorsement of the products. The use of a hashtag as part of the contest was also required and some might argue that was enough to identify that it was a promotion but it didn’t clearly indicate the potential financial connection so it failed in that sense of the disclosure. So while the brand was not (in my opinion) trying to deceive or trick users, it did not meet the true standard of the disclosure guidelines.
There are many cases all over the web where brands and bloggers (who are also supposed to disclose any relationships, payments, or incentives that influence their content) are in violation of either the FTC guidance or particular social network contest rules. The level of enforcement required to track each and every branded contest would be daunting and this notification should not push companies away from social engagement with key customers. However, this first formal warning should serve as notice that the management of appropriate disclosure needs to be a priority in planning promotional efforts for brands within the social media space.
When establishing an online contest, brands can protect themselves by:
Reviewing the specific promotion guidelines for the network under consideration. Each social network has slightly different requirements around contests and brand promotion but all are easily accessible and should be a first step in the planning process.
Considering the pathway of the participant. Not every participant in a contest will have the full detail provided to them in full as many may hear of the promotion from friends or online networks. The clearer a promotion can be, in name and participation requirements, the easier it is to limit the chance of missed disclosure. Seek opportunity to embed the terms/rules in multiple elements of the promotion.
Monitoring other campaigns and tools that clarify disclosures. Beyond following the FTC guidelines (linked above) and the social network rules, evaluate other tools like CMP.LY that can assist with communicating disclosure needs.
Brands can and should continue to innovate and seek new ways to connect in an online world. This recent activity should not limit or scare companies but rather provide clarity to establish a level playing field that helps brands and participants connect more valuably online.