When Celebrities Carry the Message

By Matthew Schwartz

Social media channels melded with celebrity endorsements present a wealth of opportunities for PR firms to get their clients’ messages out more effectively and grow their audiences.

But careful what you wish for.

The need for speed online could put PR firms in a compromising position when it comes to how they comply with Federal Trade Commission regulations, particularly when they recruit celebrities to carry the message via social channels.

“The FTC has long taken the position that its endorsement and testimonial guidelines, as well as general regulations with respect to false and misleading advertising communications, apply equally in the social media context as they do in traditional marketing communications materials,” said Michael Lasky, co-chair of the Litigation Practice Group & Chair of the Public Relations Law Practice Group at Davis & Gilbert LLP.

ABCs of FTC
Lasky spoke at a recent PRSA Counselors Academy forum about how PR firms can get a better grip on what’s at stake when agencies promote their employer’s or client’s products and services, particularly on social channels, and deploy celebrity endorsements.

Endorsements and testimonials via social channels are de rigueur these days, of course, whether via celebrity tweets or “YouTube celebrities” endorsement videos.

Agency owners and C-level executives have to know the rules of the road online—per the FTC—when they spread the word and push out messaging on behalf of clients (or one of their partners/bloggers does). Here are a few things to keep in mind:

  1. Employees/agents who promote their employer’s or client’s products and services on social media should clearly and conspicuously disclose their relationships.
  2. A blogger/influencer has a duty to disclose whether they received free products or payment from the marketer/brand.
  3. Celebrities have a duty to disclose their relationships with marketers when making endorsements outside the context of traditional ads, such as on talk shows or social channels (Facebook, Twitter).

Source: Davis & Gilbert LLP/FTC

Indeed, if they are not methodical with their social media messaging, firms can be held liable for endorser’s misleading or unsubstantiated comments.

Earlier this year, for example, Truth in Advertising published an expose on the failure of Kim Kardashian and Kylie Jenner to disclose their many paid sponsorship relationships online, including on their Instagram pages, according to Lasky. (The Kardashians and Jenners have subsequently edited many of the posts in question to include the disclosure, #ad.)

“While the FTC has not taken specific action against these individuals yet, this increasing scrutiny by watchdog groups on celebrities’ obligations to disclose and the push to bring these practices to the attention of the FTC may herald an era where regulators are just as focused on influencers, their networks and their agencies as they are on the marketers and brands,” Lasky said. “All parties involved, including maybe the celebrities themselves, will need to stay on top of their obligations to avoid getting into hot water with regulators.”

Social Media Playbook
Sure, the vast majority of brands and organizations now use social media to get their marketing messaging out. However, fewer than a third of businesses have formal social media guidelines in place, according to Lasky, pointing to various studies.

Without formal social media guidelines PR firms may find themselves in an unenviable position the next time they recruit a celebrity to promote a new PR/marketing campaign.

“When in doubt, keep in mind the FTC’s key principles of transparency and monitoring,” Lasky said. He stressed that agency owners must “educate your employees or members of your influencer networks on their responsibilities, including endorsement disclosure obligations and what they can and cannot say about client products.”

This post was originally published on Gould + Partners. You can sign up for their email newsletter, Inside Edge…Business Strategy for PR, Media & Creative Service Agencies, here.