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How to Stay on the Right Side of the FTC When Publishing a Sponsored Video

How to Stay on the Right Side of the FTC When Publishing a Sponsored Video

The #Sponsored session at Advertising Week 2017 promised to shed light on the do’s, don’ts, and grey areas of #sponsored content “from multiple points of view.” And the panel discussion started off strongly.

Mary Orton, the style blogger behind Memorandum and the co-founder of Trove, a mobile style app, talked about how the updated FTC requirements have changed she discloses paid partnerships. Orton said she thought #ad and #sponsored are terms from another era and a different medium. The high profile influencer added that she only works with brands that she actually uses and often creates more content than an agreement calls for because she so passionate about the brand. Now, that promised to be a point of view that coulda been a contender.

Melissa Davis, the EVP of ShopStyle, the world’s most fashionable search engine, added her two cents on how to be successful, creative, and remain authentic while working within the guidelines of the FTC.

Kim Waite, the VP Global Communications at Laura Mercier Cosmetics, disclosed how her brand has shifted traditional marketing and advertising budgets to influencer partnerships and discussed their stance on transparency and best practices.

But, then Ellie Altshuler, an attorney at Nixon Peabody, spoke. Altshuler, who specializes in influencer contracts, is the lead council for Digital Brand Architects. She discussed game-changing rulings and said the lines between influencers and celebrities are now more blurred than ever. Once she weighed in, the other three panelists deferred to her comments as if they were the Highest Paid Person’s Opinion (HiPPO).

So, what had promised to be a lively discussion “from multiple points of view,” turned into asymmetrical conversation with more than one panelist asking at one point or another, “What do you think, Ellie?” Nevertheless, video marketers still need to know if “Sponsored is a dirty word or new normal. So, let me summarize what Altshuler had to say about how to be successful, creative, and remain authentic while working within the guidelines of the FTC.

If you have any influence over influencers, alert them to three developments, including the FTC’s first law enforcement action against individual online influencers for their role in misleading practices. According to the FTC, Trevor Martin and Thomas Cassell – known on their YouTube channels as TmarTn and Syndicate – deceptively endorsed the online gambling site CSGO Lotto without disclosing that they owned the company.

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FTC & Law Enforcement

Here’s the backstory: Counter-Strike: Global Offensive (also known as CS: GO) is an online, multiplayer, first-person shooter game. “Skins” are game collectibles that can be bought, sold, or traded for real money. Skins have another use: They can be used as virtual currency on certain gambling sites, including CSGOLotto.com. On that site, players could challenge others to a one-on-one coin flip, wagering their pooled skins. In 2015, respondent Martin posted a video touting CSGO Lotto:

We found this new site called CSGO Lotto, so I’ll link it down in the description if you guys want to check it out. But we were betting on it today and I won a pot of like $69 or something like that so it was a pretty small pot but it was like the coolest feeling ever. And I ended up like following them on Twitter and stuff and they hit me up. And they’re like talking to me about potentially doing like a skins sponsorship like they’ll give me skins to be able to bet on the site and stuff. And I’ve been like considering doing it.

Martin followed up with more videos on his YouTube channel showing him gambling on the CSGO Lotto site. In addition, he tweeted things like “Made $13k in about 5 minutes on CSGO betting. Absolutely insane” and posted on Instagram “Unreal!! Won two back to back CSGOLotto games today on stream – $13,000 in total winnings.”

Cassell promoted CSGO Lotto in a similar way, posting videos that were viewed more than five million times. In addition, he tweeted a screen shot of himself winning a betting pool worth over $2,100 with the caption “Not a bad way to start the day!” According to another tweet, “I lied . . . I didn’t turn $200 into $4,000 on @CSGOLotto. . . I turned it into $6,000!!!!” Then there’s this one: “Bruh.. i’ve won like $8,000 worth of CS:GO Skins today on @CSGOLotto. I cannot even believe it!”

Well, Bruhs, while we’re on the subject of things we cannot even believe, did either of you like consider clearly disclosing that you like owned the company – a material connection requiring disclosure under FTC law?

The complaint also challenges how the respondents ran their own influencer program for CSGO Lotto. They paid other gamers between $2,500 and $55,000 in cash or skins “to post in their social media circles about their experiences in using” the gambling site. However, the contract made clear that those influencers couldn’t make “statements, claims, or representations . . . that would impair the name, reputation and goodwill” of CSGO Lotto. And post they did on YouTube, Twitch, Twitter, and Facebook – in many instances, touting winnings worth thousands of dollars.

According to the FTC, Cassell, Martin, and CSGOLotto, Inc. falsely claimed that their videos and social media posts – and the videos and posts of the influencers they hired – reflected the independent opinions of impartial users. The complaint also charges that the respondents failed to disclose the material connection they had to the company – and the connection their paid influencers had. The proposed settlement requires Cassell, Martin, and the company to make those disclosures clearly and conspicuously in the future. The FTC is accepting public comments about the settlement until October 10, 2017.

An interesting aside: This isn’t the first time Cassell’s name has appeared in an FTC complaint. In a 2015 settlement with Machinima, the FTC alleged that Cassell pocketed $30,000 for two video reviews of Xbox One that he uploaded to his YouTube channel. Although the FTC didn’t sue him, the complaint in that case alleged, “Nowhere in the videos or in the videos’ descriptions did Cassell disclose that Respondent paid him to create and upload them.”

FTC: Warning Letters

The next development of interest to influencers relates to more than 90 educational letters the FTC sent to influencers and brands in April 2017, reminding them that, if influencers are endorsing a brand and have a “material connection” to the marketer, that relationship must be clearly disclosed, unless the connection is already clear from the context of the endorsement.

21 of the influencers who got the April letter just received a follow-up warning letter, citing specific social media posts the FTC staff is concerned might not be in compliance with the FTC’s Endorsement Guides. But the letters are different this time. The latest round asks the recipients to let the FTC know if they have material connections to the brands in the identified social media posts. If they do, the FTC has asked them to spell out the steps they will be taking to make sure they clearly disclose their material connections to brands and businesses.

Updated Guidance for Influencers and Marketers

The FTC has also just released an updated version of The FTC’s Endorsement Guides: What People are Asking, a staff publication that answers questions about the use of endorsements, including in social media. The principles remain the same, but we’ve answered more than 20 new questions relevant to influencers and marketers on topics like tags in pictures, disclosures in Snapchat and Instagram, the use of hashtags, and disclosure tools built into some platforms. You’ll want to read the updated brochure for details, but here are four “heads up” points for influencers:

  • Clearly disclose when you have a financial or family relationship with a brand. “But everybody knows!” No, they don’t. It’s unwise for influencers to assume that people know all about their business relationships.
  • Don’t assume that using a platform’s disclosure tool is sufficient. Some platforms are starting to offer disclosure tools, but that’s no guarantee they’re an effective way for an influencer to disclose a material connection to a brand. Like so many things on social media, it’s all about context. One key consideration is placement – whether the disclosure attracts viewers’ attention, taking into account where people are likely to look on a particular platform. For example, when paging through a stream of eye-catching photos, a viewer may not spot a disclosure placed above the picture or off to the side. The ultimate responsibility for making clear disclosures is yours. That’s why you want to make sure your disclosures are hard to miss.
  • Avoid ambiguous disclosures like #thanks, #collab, #sp, #spon, or #ambassador. Clarity counts. When disclosing a material connection to a brand, use language that’s clear and unmistakable. It’s unlikely that abbreviations, shorthand, or arcane lingo will communicate the disclosure effectively to consumers. Think of it like football. Unless the quarterback throws the ball and the receiver catches it, it’s an incomplete pass.
  • Don’t rely on a disclosure placed after a CLICK MORE link or in another easy-to-miss location. Consider your own viewing habits on social media. Do you click every CLICK MORE link? We don’t either. When disclosing a brand relationship, the better approach is to hit ‘em right between the eyes. Furthermore, on image-only platforms, superimpose your disclosure over the picture in a clear font that contrasts sharply with the background.

Now, I’m not a lawyer. But, I know enough to recommend that you talk with one about how to be successful, creative, and remain authentic while working within the guidelines of the FTC. That’s right, I would have differed to the HiPPO, too. Hey, there are plenty of other things worth debating.


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When Data Meets Creative: Why Audience Insights are Critical for Video Publishers

When Data Meets Creative: Why Audience Insights are Critical for Video Publishers

One of the largest panels at Advertising Week 2017 tackled one of the classic topics in the advertising, marketing, media, and related creative industries: The strategic symbiosis of data and creative. The panel was moderated by Quynh Mai, Founder of Moving Image & Content. Her panelists included some of the best and the brightest stars in the business, namely:

  • Richard Alan Reid, BuzzFeed’s International Executive Creative Director & Executive Producer.
  • Renee Plato, the SVP of Media Solutions and Innovation at Nielsen.
  • Becky Wang, the CEO of Crossbeat New York.
  • Michelle Klein, Facebook’s Marketing Director for North America.
  • Kristen D’Arcy, who runs digital marketing, social and media for AEO.
  • Maureen Traynor, the Global Director, Creative Solutions at Spotify.

Since I know you’re incredibly busy, let me share the session’s conclusion at the beginning of this column: Successful brands and disruptors are inverting the traditional “top down” approach that was driven by Creative Directors, who ruled the industry for decades. They are also abandoning the siloed organizational structure that has become a barrier to success in the digital age.

Instead, they are becoming better listeners and internalizing their data-driven audience insights across teams. That means they are adopting a data-driven approach to creativity and letting these insights drive the creative process instead of sticking with the old “Mad Men” approach. Instead of retrofitting strategy to support creative, the panel urged attendees to let data and insights lead creative. That was the big takeaway. Get it? Got it? Good. Now, most of you can get back to work.

But, for those of you who want to dig deeper, there were 10 other observations that Mai was surprisingly able to capture and summarize at the end of the session:

  1. Plato: Differentiate yourself.
  2. Wang: Establish your data approach.
  3. Plato: Learn about your audience.
  4. Traynor: Create for your audience.
  5. Reid: Engage with your audience.
  6. Klein: Use your resources to optimize online.
  7. D’Arcy: Use your resources to optimize offline.
  8. Wang: Think about the data in three dimensions.
  9. Traynor: Consider the context.
  10. Reid: Grow with your audience.

And for those of you who are now kicking yourself for missing this session, relax. Watch the video: “Data <3 Creative: A Strategic Symbiosis.” Yes, it is 41:46 long, but watching it will put you about a year ahead of most of your busy competitors, who stopped reading this column after the first 250 words.

Now, for those long-time readers who know that I tend to keep the good stuff on the top shelf or at the end of the column, whichever is hardest to reach, let me share the following strategic insights, critical data, tactical advice, and trends in the digital video marketing business. Hey, if I can be replaced with a video that’s 41:46 long, then I should stop writing now and start talking into my laptop’s webcam.

Audience Insights for Online Video Campaigns

Why is it so hard to get the left-brained data geeks into the same room with the right-brained creative types when digital campaigns are being incubated? Don’t both sides realize that using your whole-brain is more likely to be successful?

Well, the panelists decided that outdated organizational structures and “top down” approaches were to blame. And, it’s true that too many senior executives at ageing agencies still put too many talented people into silos like the “creative services” department or the “research” unit of the “marketing services” department. And then they put these different departments on different floors of tall buildings with slow elevators or even in different buildings in big cities – and are shocked, shocked to find that’s it difficult to get their employees to collaborate.

And too many senior executives at big brands have similar barriers to overcome. They’re still using org charts that are generally modeled after the classic military structure used by Napoleon from 1793 to 1815. Seriously. And marketers use a lot of military terms, including strategies, tactics, campaigns, objectives, officers, divisions, and territories that reflect the thinking of Albert W. Emery, an American advertising agency executive born in 1923, who said, “Marketing is merely a civilized form of warfare in which most battles are won with words, ideas, and disciplined thinking.”

So, it’s not surprising that the best and the brightest stars in 2017 would reach that same conclusion that Pogo, a possum in the classic comic strip by Walt Kelly, reached back in 1953: “We have met the enemy and he is us.” But, will a simple reorg save big brands and aging agencies from a similar fate? Is that the only way to ensure that you get the left-brained data geeks into the same room with the right-brained creative types when digital campaigns are being incubated?

There is an alternative approach that was discussed the day before this session was held. And, unfortunately, none of the rising stars who are familiar with this alternative approach were members on one of the largest panels at Advertising Week.

I’m talking, of course, the moderator and three panelists from the session entitled, “#Sponsored and The Rise of Celebrity Influencers for Subscription & E-Commerce Marketing.”  Ashley Iaconetti, a reality TV personality who first appeared on ABC’s The Bachelor, Paul Desisto, a senior talent agent at Central Entertainment Group, Jolie Jankowitz, the Director of Influencer Marketing for FabFitFun, and Caitlin McLarnon, the Growth Marketing Manager of the US division of HelloFresh would have added a radically different perspective to the session on “Data <3 Creative: A Strategic Symbiosis” – if they could have squeezed an extra chair on the Shutterstock Stage at the Liberty Theatre.

They understand that tens of thousands of social media influencers and video content creators are not only data geeks, but also creative types. And these data-driven influencers and creators already work naturally and effectively in small teams – and generally outperform the traditional approach to producing engaging video content in less time and at a lower cost. All big brands or ageing agencies need to do is figure out:

  • How to identify the right influencers.
  • How to find the right engagement tactics.
  • How to measure the performance of your programs.

Critical Data for Audience Insights 

Is this even possible? Yes, it is. I’ve already written about how Chobani uses sponsored videos to stir up yogurt sales and market share, GE’s sponsored videos electrify B2B and B2C audiences, and Dollar Shave Club’s video campaigns are doing just great.

In addition to these examples, I just looked at Tubular’s DealMaker and saw that 9,994 brands have sponsored 11,100 content partners, who’ve uploaded 49,500 videos in campaigns across 24 industries, 21 genres, and 123 countries in the last 90 days. So, it appears that lots of brands are kicking the tires of this alternative approach.

Tactical advice for Video Marketers and Creators

Even after you identify the right influencers, you still need to find the right engagement tactics. I provided a number of tips and best practices in “Schmooze optimization: What it is and why it expands views, engagements, and earnings on YouTube” as well as in “Schmooze optimization 2: The search for more B2B video success.” Yes, both of these articles were written back in 2013. But, I was either ahead of my time, or (more likely) no electronic-communications superhighway, no matter how vast and sophisticated, will ever replace the art of the schmooze. But, you also need to know how to measure the performance of your programs. Well, you’re in luck. I wrote a three-part series last fall on the:

In other words, long-time readers of Tubular Insights already know how to overcome these hurdles.

Trends in Digital Video Marketing

So, let me close with this honest analysis of these latest trends in the digital video marketing business. Unfortunately, they appear to be remarkably similar to the trends in the advertising business that David Ogilvy wrote about in 1983 in his classic book, Ogilvy on Advertising. Back then, Ogilvy lamented “the cult of creativity” and declared, “When I write an advertisement, I don’t want you to tell me that you find it ‘creative.’ I want you to find it so interesting that by buy the product.” He added that creative types who have a contempt for research “occasionally luck into a successful campaign, but you will run the risk of skidding about on what my brother Francis called ‘the slippery surface of irrelevant brilliance.’”

And my favorite chapter in Ogilvy on Advertising is Chapter 15: “18 miracles of research.” It begins with this warning: “Advertising people who ignore research are as dangerous as generals who ignore decodes of enemy signals.”

So, it’s sad that we still need to discuss the strategic symbiosis of data and creative in 2017. I would have thought that we’d already learned this lesson a long time ago. But it looks like the “Mad Men” era never ended.


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How Luxury Brands Perform Differently When it Comes to Online Video [Report]

How Luxury Brands Perform Differently When it Comes to Online Video [Report]How are luxury brands leveraging video, and what type of video content is working for them? A new study from OMD EMEA and Tubular Labs reveals vital social video insights across select sectors of the luxury industry.

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