If you haven’t already seen the FTC’s Guides Concerning the Use of Endorsements and Testimonials in Advertising, there’s a lot to read through (81 pages, to be precise!) so it’s with great thanks that I point you to Andy Sernovitz’s excellent analysis of the regulations. Andy is the CEO of the Social Media Business Council and the word of mouth marketing company Gaspedal.

A couple of items stood out to me:

1) Social media posts are considered sponsored advertising messages and are regulated by the FTC if they meet certain conditions.

When deciding if a post should be considered an advertising message (an “endorsement”), the FTC will look at whether the writer:

• is compensated (cash or in-kind) by the marketer or a third party
• has an ongoing relationship with the marketer
• participates in a word of mouth marketing program that provides products to review publicly
• receives similar products or services regularly, or expects to in the future

Think about that in terms of you customer reference program.  Do you have a points system in place which enables references to ‘trade in ‘ those points for services, training, tickets for customer events, etc.? Was the same individual who posted a blog entry about your product yesterday (see point 2) below)  part of a case study on that same product 6 months ago? Did they receive points or a ‘thank you’ gift for being part of the case study?   Is this clear to everyone reading the case study and the blog entry?

2) Claiming that “bloggers can write whatever they want” is not a protection: The FTC specifically rejected this argument: “An advertiser’s lack of control over the specific statement made via these new forms of consumer-generated media would not automatically disqualify that statement from being deemed an endorsement.”

So is the aforementioned blog entry considered an endorsement, and thus subject to the rules an regulations laid out in the guidelines? Maybe, dependent on what the individual writes. The FTC says that when “…the connection is not reasonably expected by the audience, such connection must be fully disclosed.”

As I thought about these guidelines further in relation to Customer References I believe the biggest impact will be a tightening (as if things are not challenging enough already!) by B2B customers in what they’re willing to do or feel able to do in terms of reference activities. For certain it means that Customer Reference teams need to be even more diligent in staying abreast of the blogging, twittering, facebooking, etc. that participants in their customer reference program are doing.

What are your thoughts?