Saturday, 10 October 2009

The New FTC guidelines for bloggers and internet marketers

The Federal Trade Commission (FTC) is the American consumer protection body which has federal authority to police anticompetitive behaviour and to protect consumers. It was originally formed in 1914 to take down the robber-barons that dominated US commerce, and since then has branched off to regulate other aspects of modern commerce.

Now they are looking at the internet. In particular they are worried about the dubious claims being made for products that are sold with the consumer expecting a certain result - e.g. the make money scams which start "I was bankrupt and two months later I was a millionaire" type thing. Consumers are vulnerable to this sort of thing because they want to make money online fast. As I explained in my post on how long it takes to make money online, there is nothing quick or easy about internet marketing. But a lot of people have been tricked into buying courses that claim it is.

Now the FTC has stepped in with some new guidelines. In the past they allowed testimonials from people claiming all sorts of things, as long as there was a disclaimer saying "Results not typical". Now they are only allowing typical results to be claimed in online testimonials. So if you are claiming that everyone using your course becomes a millionaire in two months, you had better be able to prove this is typical or end up getting sued by the FTC with a fine up to $11,000.

Some marketers might think they can get round this by simply not having any testimonials at all. But they now want you to disclose within your text the results that the typical consumer might expect. So if the typical consumer won't make any money at all from your product, or won't lose weight etc etc, then you have to say that! As Frank Kern points out in his blog post about the FTC decision, this is going to take a lot of competition out of the market. Which is good for the legitimate internet marketers.

And what of internet marketers outside the USA? In my personal opinion, I think this ruling affects them too. The net is global - which means that some of the people reading your material and buying from your site are from countries not your own. If you have potential American customers, you are affected. So comply with the ruling, don't try to trick your customers, keep everything abovge board and legit, and you won't go far wrong. Don't be tempted to take short-cuts, it's just not worth it.

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