Antitrust Law Daily Wrap Up, ADVERTISING NEWS: Updated FTC Online Advertising Guidance Addresses Changes to Digital Advertising, (Mar 13, 2013)

By Tobias J. Gillett, J.D., LLM.

The FTC has issued new guidance to assist online advertisers in making disclosures that would comply with the law and avoid deceiving consumers. The guidance, known as “Dot Com Disclosures,” updates guidance released in 2000 to reflect changes to the marketplace such as the increased use of mobile devices and the rise of social media marketing.

The new guidance, like the 2000 guidance, stresses that the same consumer protection laws apply to online advertising as apply to advertising in all other mediums, and that the FTC’s “role in protecting consumers from unfair or deceptive acts or practices encompasses advertising, marketing, and sales online, as well as the same activities in print, television, telephone, and radio.” Included with the Disclosures are sample advertisements that illustrate the principles outlined in the document.

To comply with the FTC’s rules, advertisers must include disclosures in their advertisements whenever the absence of a disclosure would render an advertisement misleading. These disclosures must be presented “clearly and conspicuously,” which in the online environment requires ensuring that it remains clear and conspicuous on whatever devices and platforms the consumer employs to view the advertising. Advertisers must ensure disclosures are placed on a website where consumers are likely to see them. If an advertisement necessitates a disclosure, and the disclosure cannot be made “clearly and conspicuously” on a particular platform, the advertiser should not use that platform.

In determining whether a disclosure is sufficiently clear and conspicuous, “advertisers should consider its placement in the ad and its proximity to the relevant claim.” Those advertisers may also wish to consider “the prominence of the disclosure; whether it is unavoidable; whether other parts of the ad distract attention from the disclosure; whether the disclosure needs to be repeated at different places on a website; whether disclosures in audio messages are presented in an adequate volume and cadence; whether visual disclosures appear for a sufficient duration; and whether the language of the disclosure is understandable to the intended audience.” The FTC noted that “[a]lthough the 2000 guidelines defined proximity as ‘near, and when possible, on the same screen,’ and stated that advertisers should ‘draw attention to’ disclosures, the new guidance says disclosures should be ‘as close as possible’ to the relevant claim.”

The guidance also states that disclosures, such as cost information or certain health and safety claims, “that are an integral part of a claim or inseparable from it should not be communicated through a hyperlink.” If an advertiser does use a hyperlink for a particular disclosure, the hyperlink “should be clearly labeled to communicate the specific nature of the information to which it leads.” In evaluating a hyperlinked disclosure, an advertiser should consider “the labeling or description of the hyperlink; consistency in the use of hyperlink styles; the placement and prominence of the hyperlink on the webpage or screen; and the handling of the disclosure on the click-through page or screen.” Online advertisers should also ensure that the hyperlinks function adequately on different platforms and devices.

Advertisers should also consider the technological limitations of different browsers and devices, such as space constraints on mobile devices and the ability of devices and browsers to display certain content. Advertisers should avoid using pop-ups for disclosures, since those are frequently blocked, and consumers often ignore them even when they are not blocked.

Disclosures should also be displayed prominently, and size, colors, and graphics may aid in drawing attention to them. Advertisers should ensure that other elements of the advertising do not distract from the disclosures. Advertisers may need to repeat some disclosures throughout an online advertisement, to ensure that consumers that only read part of an online presentation do not miss them, and that certain disclosures appear together with claims that require qualification. Multimedia messages must incorporate disclosures in an appropriate manner, with audio disclosures accompanying audio messages and written disclosures accompanying written messages. The disclosures must appear for a sufficient duration, and employ understandable language.

The FTC began its revision of the Dot Com Disclosures in May 2011. In preparing the new guidance, the FTC held three public comment periods, and hosted a day-long public workshop in May 2012.

News: Advertising ConsumerProtection FederalTradeCommissionNews