To disclose or not to disclose? The growing importance of affiliate disclaimers

As the influencer market burgeons and becomes more mainstream, so it finds itself subject to additional scrutiny.

This has manifested itself in a recent letter by the Federal Trade Commission (FTC) in the US that reminds publishers about their requirement to explicitly state to their audience the existence of a commercial relationship, specifically when using Instagram.

The letter states that “if there is a “material connection” between an endorser and the marketer of a product – in other words, a connection that might affect the weight or credibility that consumers give the endorsement – that connection should be clearly and conspicuously disclosed…. material connections could consist of a business or family relationship, monetary payment, or the provision of free products to the endorser. The Endorsement Guides apply to marketers and endorsers. FTC staff guidance makes clear that marketers should advise endorsers of their disclosure responsibilities.”

In making explicit reference to ‘influencers’ the FTC also makes it known it is familiar with the latest trends in content marketing and brand relationships.

This advice from the FTC is the latest in a growing body of announcements from individual countries’ regulatory bodies alerting the digital industries to their obligation to be transparent with consumers so they are aware of how content could be skewed or designed based on receiving a financial reward for doing so.

While many influencers and affiliates will go to great lengths to ensure the advice and coverage they offer to brands and their products is based on their actual endorsement, rather than swayed by network payments or freebies, being clear will ultimately build trust with consumers.

In April this year the Advertising Standards’ Agency (ASA) in the UK issued some further guidance in conjunction with the Code of Advertising Practice (CAP) about affiliate marketing. This isn’t the first time the body that regulates advertising has shown an interest in our channel. In fact a few years back a group of affiliate networks (including Awin) met the regulator to explain how the affiliate model works, so it was clear at the time this was something the networks needed to be vigilant about.

In the updated advice, ASA and CAP issue a handy infographic and then go into detail about various affiliate models and how they might choose to offer on-site disclaimers.

This point is particularly important as the varied nature of affiliate marketing means that there are a huge range of media which requires different solutions. Consider a tweet’s 140 character limit, what sort of disclosure should an affiliate using Twitter offer? The CAP guide actually offers specific direction, stating “on Twitter, as space is limited, labelling the content with “Ad” or similar is likely to be the clearest way of identifying it as advertising.”

As websites offer significantly more space to experiment with disclosure solutions, the guide offers this: “although not a requirement of the Code, affiliate marketers may choose to explain the nature of the relationship between themselves and the company by stating that they receive a small share of sales through the inclusion of links, promotional codes etc.”

On this latter point, this was something that Awin decided to assist affiliates with four years ago, with the launch of our paid advertising, one page website: Paid for Advertising.

The tone of the content is conversational and aimed at explaining, in simple terms, how content may have a commercial relationship attached to it. The focus is on the value exchange that the Internet trades on in order to facilitate so much free content.

While the site probably needs an overhaul, the intent is clear. Some affiliates choose to link to it; in this example an Awin affiliate has done so just below the fold of their ‘About’ page.

The future of disclosure will probably be more formal and increasingly universal.

If you operate in a market where this has yet to register as an issue, then it’s highly likely it will do at some point. It is for industry to work collaboratively to agree standards and roll out solutions so that affiliates adopt the same approach wherever they are.

Ultimately this will breed familiarity with consumers and in doing so raise the overall standards and visibility of the affiliate channel.