Foundry Law Group Blog

Advertisements and Social Media – A Dangerous Mixture If You Don’t Know Some Basic Rules

By Megan Wargacki:

Globally, 46% of online consumers use social media when making a purchase decision.[1] So, if your business isn’t advertising on social media, it probably should be…but you must know what you are doing because the FTC has rules about online advertising.

Thankfully, in March 2013, the FTC published a guide for businesses advertising products and services online called “.com Disclosures: How to Make Effective Disclosures in Digital Advertising.” This guide provides advice from FTC staff about making clear and conspicuous online disclosures so businesses can comply with FTC laws.  The guide also provides examples and explanations of many FTC rules and regulations.

This post will cover some of the important things your business should consider when advertising on social media sites.

Disclosures that are required to prevent an advertisement from being unfair, deceptive or otherwise illegal must be presented “clearly” and “conspicuously.” Whether a disclosure meets this standard is measured subjectively, from the standpoint of the consumer. Does the consumer actually perceive and understand the disclosure within the context of the entire ad and are the claims the consumer takes from the ad truthful and substantiated? Thus, in placing their advertisements, businesses should adopt the perspective of a reasonable consumer.

Under the new FTC guidelines, advertisers are required to place disclosures on all devices that consumers may use to view an ad. If the disclosure can’t be made clearly and conspicuously on the device, the FTC recommends that advertisers not display the ad on that device.

In addition, the disclosure should be as close as possible to the ad, without requiring the consumer to scroll. Specifically, disclosures about a product’s cost, or health and safety issues must be listed on the same page as the ad and cannot be included as a hyperlink.

As the advertiser, it is your responsibility to ensure your message is truthful and not deceptive, so you must draw attention to your disclosure because consumers may not be looking for it.  To be effective, the disclosure must be noticed and understood to be connected to the advertisement that it modifies. If the disclosure is buried in the fine print somewhere on another screen, where the consumer may not find it, the disclosure does not meet the clear and conspicuous standard.

Although the standard for a clear and conspicuous disclosure is subjective, if your business follows these guidelines, then its social media ads should be clear and conspicuous:

  • The disclosure must be very close to the claim it’s disclosing.
  • Draw attention to the disclosure and make it unavoidable to view.
  • When possible, avoid having to scroll to see the disclosure.
  • If using hyperlinks for disclosures, they must be obvious, labeled appropriately, go directly to the disclosure upon click-through, repeated in long ads and monitored for effectiveness.
  • If using disclosures in audio or video messages, ensure they are presented in adequate volume and cadence and, for video messages, appear for sufficient duration.
  • The disclosure must be made in a language or languages appropriate to the consuming audience.
  • In space constrained ads, (such as Tweets, Pins, etc.) the disclosure must still be obvious and clearly stated.
  • The disclosure is needed before the decision to buy is made, that is, before the consumer adds a product to a cart.
  • The claim needing the disclosure must actually be disclosed.

Fortunately, most of these guidelines are met simply by including the word “Ad” at the start of a post on Twitter, Facebook, Google+, Instagram, LinkedIn, Tumblr, Pinterest, etc.

Keep in mind, if a disclosure is necessary but it is not possible to make it in a clear and conspicuous manner, then the ad should either be modified so that the disclosure is not necessary, the ad should not be published on the device/platform that does not allow for clear and conspicuous disclosure, or the ad should not be published at all.


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