Tricia Zorn, Digital Project Manager at Marden-Kane, gives us this week’s article on the latest challenge in running a social media promotion: FTC involvement.

Last month the Federal Trade Commission made an example out of Cole Haan when, in a public letter sent to Cole Haan’s counsel, the FTC expressed concerns over their Pinterest contest not adequately disclosing the connection between the entrant and the sponsor .  The contest rules asked entrants to  create a board on Pinterest and pin five shoe images from Cole Haan and five images of their “Favorite place to wander” with the hashtag #wanderingsole. Entries would then be judged based on creativity and one entrant would be awarded the grand prize of a $1,000 shopping spree.

Only problem was that the promotion violated Section 5 of the Federal Trade Commission Act which saw the hashtag as being “deceptive.”  The FTC determined that the opportunity to win the $1,000 prize constituted a material connection between the contestant and the brand and therefore, legally required disclosures.  Simply asking participants to just use the hashtag #wanderingsole did not adequately communicate that this was a contest entry with a financial incentive between the participant and the sponsor, Cole Haan.

The FTC later decided not to pursue any legal action against Cole Haan because they had not previously publicly addressed that this type of entry into a contest could be considered a form of material connection or whether a “pin” on Pinterest may constitute an endorsement.  However, now that they have it we all need to be more conscious about including the required disclosures in our social media promotions.

While the FTC probably doesn’t plan on going after every social media contest it’s still a good idea to make sure your follow the rules.  Here are a couple tips to avoid a call from the FTC.

1. Work closely with your legal team.  Make sure you and your team are familiar with the specific guidelines associated with social media platform your promotion is running on as well as the FTC’s so that your promotion and official rules are compliant.
2. Be transparent…very, very, very transparent.  No matter what social network you are on you need to make sure that participants know that they are entering a promotion.  This can be done by simply adding “promo”, “sweeps” or “contest” to the end of your hashtag.  For example, if your brand is running a #SummerTime promotion just change it to #SummerTimeSweeps.
3.  Require links to legal disclosures. Consider requiring links to your legal disclosures in any social posts that constitute an entry. For instance, you might want to set up a special tiny URL that links to the Full Official Rules and ask entrants to include that URL in order for the entry to be considered. No link included, no entry.

If you have questions, contact us and we can discuss a plan for your sweepstakes or contest.

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