This document discusses how major brands handle demands from the Federal Trade Commission regarding affiliate marketing compliance. It provides an overview of FTC definitions, guidelines, and examples of compliance risks. Major points include that affiliates are seen as an extension of a brand's marketing, endorsements by affiliates need to include a disclosure if compensated, and brands need to proactively teach, create compliance processes, and enforce rules to avoid penalties from the FTC. The document offers examples of proactive actions taken by large brands to ensure affiliate marketing compliance.

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How Big Brands Handle FTC Demands
Julia Pavone

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Outline
• FTC Definitions & Guidelines
• Types of Compliance Risks
– Examples
– BrandVerity Study
• Costs of Non-Compliance
• Real World Examples
• Proactively Taking Control

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Learn to think like the FTC
• Affiliates/Partners are seen as part of a brand’s
marketing channel
• If an affiliate/partner makes claims or discusses an
attribute and receives compensation, need to follow
guidelines

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FTC Guidelines
An advertisement or promotional message shouldn’t
suggest or imply to consumers that it is anything other
than an ad
https://girlwithcurves.com/post/132058612904/feather-blazer-high-waist-jeans

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Disclosures
Disclosures must be clearly and conspicuously stated
for any sponsored content
"Native Advertising: A Guide For Businesses | Federal Trade Commission". Ftc.gov. N.p., 2016. Web. 20 Dec. 2016.
"The FTC’S Endorsement Guides: What People Are Asking | Federal Trade Commission". Ftc.gov. N.p., 2016. Web. 19 Dec. 2016.
".Com Disclosures: How To Make Effective Disclosures In Digital Advertising". Ftc.gov. N.p., 2016. Web. 20 Dec. 2016.

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Lord & Taylor
Exhibit A
Page 5 of 5

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Cole Haan – #wanderingsole

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BrandVerity Study
• Failure is the Norm
– 80% did not include a disclosure
• Better Together
– 79% of posts created through
advertiser and affiliate collaboration
included some form of disclosure
• All Disclosures Not Created
Equal
– Only 21% of disclosures were
adequate
Download Today:
bit.ly/FTCstudy

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Costs of Non-Compliance
• Public Reprimands
– For Brands: Loss of customers
– For Publishers: Loss of business
• FTC Reprimands
– Court Ordered Monitoring
– Fines

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HOW BIG BRANDS ARE STAYING
PROACTIVE

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Example: Large Agency – Online Retail
• Actions Taken: Extreme Proactivity
– Require all affiliate pages to have a proper disclosure on their pages
stating there are paid links
– Not allowing any affiliates into program without disclosure present
• Benefit
– Starting their program out with a requirement, rather than having to go
back later and educate/enforce

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Example: Credit Card Issuer
• Actions Taken: Unique Disclosure
– Each time an affiliate has their card, they have a unique brand specific
advertiser disclosure
• Benefit
– Easy to show that they are being proactive
– Helpful in monitoring since you can look for specific text

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Example: Large Bank
• Actions Taken: Control Traffic Flow
– All referral links leaving publisher site only come from 1 page
– All links for a specific card in any article on a page must only link back
to one page on the site that will link back to the bank
• Benefit
– Able to ensure that every customer sees the disclosure, TOS, etc. if
all traffic goes through one page

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WHAT DO YOU DO NOW?

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Tips For A Compliant Program
Teach
Create a
Process
Enforce

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Tips For A Compliant Program
1. Teach
– Yourself
– Colleagues
– Partners
Teach
Create a
Process
Enforce

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Tips For A Compliant Program
2. Create a process
– Review each affiliate site
– Capture screenshots
– Record remediation actions
– Compile report
Create a
process
EnforceTeach

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Tips For A Compliant Program
3. Enforce
– When an issue is found, contact the affiliate and take action
– Keep a record of the issues to show you have a process for taking action
Enforce
Teach
Create a
process

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Summary
• Affiliates/Partners are seen as part of your marketing
program
• Any endorsements by affiliates/partners need to have a
disclosure if being compensated
• Learn the FTC guidelines for your industry
• Teach others what those guidelines are
• Develop a compliance process
• Enforce the your rules

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Q & A
www.BrandVerity.com