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With over 12 million American adults maintaining a blog, over 15 million active blogs, and an estimated Internet audience of 188.9 million, the popularity of blogs is undeniable. Bloggers clearly command a large, worldwide audience and their potential for reaching millions of people has not gone unnoticed. Companies have recognized the opportunities for marketing their products through the blogosphere. Increasingly, they are approaching bloggers and users to assist their marketing efforts by placing positive reviews of products on their blogs. One survey suggests as many as 4 out of 5 bloggers surveyed post reviews of brands and products. Although asking people to review their products is perfectly legal conduct, it remains unregulated. More importantly, companies are not currently required to disclose whether they compensated a reviewer. It is this element of the blogging-marketing dynamic that the Federal Trade Commission (FTC) finds troubling and wishes to change.
The FTC plans to issue guidelines that would allow it to regulate blogging conduct. Under the new guidelines, the agency would have the authority to penalize bloggers and the companies that compensate them where false claims are made, or where a conflict of interest is not divulged. Amazon, for example, would need to disclose that it paid its blogger affiliates between 4% and 15% of the revenue from a transaction generated by one of its affiliates.
Although current FTC rules ban deceptive and unfair business practices, bloggers are not specifically addressed. Rick Cleland, assistant director in the FTC’s advertising division, considers the term “marketers” to encompass bloggers who review products while being compensated, and owners of blogs with affiliate sites that link to products mentioned. Accordingly, the rules should be adjusted to include them so as to protect consumers.
Naturally, this news is both beneficial and detrimental to the blogging community. On the one hand, it creates more work for the bloggers from a technical standpoint. Requiring disclosure of compensation might, however, actually foster a sense of trust between the blogger and business world. Moreover, it has the potential to promote transparency that is good for the consumer and completely within the mission of the FTC.
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