As I’ve blogged about previously, the Federal Trade Commission takes a dim view of contests that encourage consumers to post a message in social media as a means of entering a contest. Its reasoning is that consumers aren’t necessarily endorsing a product or service because the genuinely like it, but rather just as a means to win a prize. That is a “material connection” between the consumer and advertiser that ought to be disclosed within the post itself, according to the FTC.
Now the National Advertising Division (the self-regulatory forum of the BBB) has weighed in, agreeing with the FTC’s position. The Scotts Company emailed consumers, encouraging them to post a review for a chance to win a $25 gift card. But the company did not advise consumers to disclose the fact that they were writing these reviews as part of a contest. Scotts rectified the problem by attempting to tag all reviews submitted through the contest, and by changing its policies going forward. But the NAD took the opportunity to express its deep concern with the entire concept of these contests, because they undermine the reliability of all customer reviews and can be difficult to identify.
Neither the FTC nor the NAD has given clear direction on exactly how customers should disclose the existence of the contest–especially in space-constricted fora like Twitter–and my advice to my own clients has varied depending on the circumstances. Lately, though, I’ve noticed several posts containing the hashtag “#contest.“ It remains to be seen whether that passes muster with the Powers That Be, but it seems to convey the necessary message in a succinct manner.