FTC To Investigate 'Viral Marketing' Practices
mcflaherty writes "The Federal Trade Commission has stated that it is going to investigate the use of 'Viral Marketing' by corporations. This is the type of advertising that seeks to start a word of mouth campaign for the product via consumers themselves. Previously, consumers themselves set the buzz. But lately advertisement firms are stepping up to the plate themselves, seeding the market with buzz that looks independent of the company, but is in fact funded by them. The crew at Penny Arcade contend that corporate generated buzz is not Viral Marketing, and perhaps Guerrilla Marketing would be a more apt term. Either way, it appears to be a profitable advertising model."
Either way, it appears to be a profitable advertising model.
Of course it is, it exploits people's inherent trust for their friends' judgement: "if X says this and X is a nice guy, then X must be true". Only if X is paid by a corporation to spew out nice stuff about some product, it basically wrecks that basic principle of human communication.
"A door is what a dog is perpetually on the wrong side of" - Ogden Nash
It already has a name. It's called Astroturfing.
Now we need to come up with a term for what will eventually prove to be its opposite. Corporate sabotage that seeks to inspire negative propoganda for another company. If Sony hadn't been repeatedly shooting themselves in the foot with a sawed-off 12 gauge lately and inspiring all their own negative publicity, I'd almost suspect that of their vomit-inducing attempt at creating buzz for the PSP.
A community-oriented lyrics site
Investiage: an investigation employing the triage method.
Oh, say does that Star-Spangled Banner entwine / The myrtle of Venus with Bacchus's vine?
60 Minutes covered this about two years ago. It's a good segment if you can find the video.
IS slashdot trying to redeam itself after being conned into an instance of viral marketing?!
See particularly this portion of the comments/story...
Why are they investigating? Is it illegal, or is the FTC overfunded?
If they want to investigate deceptive advertising that has cost Americans billions of dollars, then I would prefer that they investigate the Iraq war.
Intron: the portion of DNA which expresses nothing useful.
Whoopee! The advertisers found out what the kids like and decided to use that to try and get more eye balls.
How about just dealing with it when the compaines lie and that whole false advertising thing?
Do people really think places like youtube and myspace were created for the community to use? No, they were created so they could get bought out by the big corporations and those corporations could put advertisments up.
Oh, and having a link in your signature to something you are trying to hock and replying to this article that this should have been looked into a long time ago... yeah, kinda hypocritcal.
I think that in the future the way we (slashdot/digg/bloggers) marketed the Wii will be a textbook sample of how viral marketing is done.
That sure is purdy brown chrome. Reminiscint of a certain release of Ubuntu, IIRC.
Thank you teh feds for taking care of this problem. spam is not so good.
moo.
I mean, how else are people going to be programmed to buy overpriced, useless crap? Won't you please help a hard-working advertising executive (who has enriched our culture with priceless works of art like this) afford his third Mercedes?
Insisting on "correct" English is like saying that there is only one, definitive recipe for chili.
Some companies have taken this a step further and are attempting to manipulate the customers themselves into giving good reviews. They are using a technique of improving the quality of their product, causing any sane customer to be unable to respond negatively. These coercive practices must end!
Does this mean that Sony will get a marketing flu shot?
One such example was when Virgin attempted to get Internet humour website B3ta.com to come up with something for their "say yes" campaign. Virgin got rather offended in fact over what was being produced and pulled out. It did however generate a storm of publicity (The Inq. wasn't the only site to report this cock-up), so it was successful in some respects.
throw new NoSignatureException();
My only question is, how is this any different from regular advertising. Because of freedom of speech, all's fair in love and advertising.
Take for instance the Michael J. Fox political ad. It was extremely pointed and misleading, but there was no problem running it on television, you're paying your "friends" in the media world to publish something in circulation, what's the difference in paying some private individual, who now thanks to the internet has a wide range of available free speech options, to do the same.
Do you trust everything you read on the internet? Why or why not? Same thing goes toward every advertisement or piece of advice that you get from someone. I don't TRULY know if product A works better than product B, but because I'm friends with the creator of product A I'll tell everyone how great it is if they ask. If I was getting paid, I would tell people even more vehemently.
Advertisers are in the business of making things look better than they really are, to create some sort of value in the minds of consumers without directly saying "value" (which is a no-no). And if I spend my company's ad dollars on getting either my employees or others to do peer-to-peer advertising as it were, again how is that different from spending it on radio/television/newspaper/magazine/internet. What about game reviews in magazine, do you think the company has a vested interest in how they are seen? Are they going to continue to advertise with a magazine that continues to give them bad reviews? Or are the reviews in the magazine lop-sided so as to encourage ad-revenue?
The last thing we need is more interference, it is in direct opposition of freedom. If you can be bought, why do you care? You can't make people play nice, it's still a choice =).
-You have been modded appropriately-
> Either way, it appears to be a profitable advertising model.
So is putting crack cocaine in your cola drink.
Which brings us neatly onto cigarette sales.
I've read many a customer review in my day and I swear that the NewEgg reviews for the Zune look fake. Do they have a method to verify that the reviewers even own the product?
Penny arcade linked the Sony viral site wrong. They had a_psp when the real site is my_psp.
http://www.alliwantforchristmasismypsp.com/
since a) I don't talk to anybody, and b) even if I did, I wouldn't trust what they said.
Sigh.
https://www.eff.org/https-everywhere
I've been wrong when I thought all advertising was viral?
I was 15 hours short of a marketing degree when I realized i wasn't qualified, I have a conscience!
Professional Politicians are not the solution, they ARE the problem.
For Christ's sake, this has been the way the world has worked for thousands of years. (Remember the story about John the Baptist starting the buzz about the "one who comes after"?)
"Consumers" have NEVER "set the buzz." If you think otherwise, I'd like to meet you, because there's a good chance you'll be buying whatever I'm pitching in 3-6 months. (And you'll think it was your idea too.)
I think a lot of viral marketing is based on the idea that there's no such thing as negative publicity. Judging by most people's reactions when they find out about such ploys, there really isn't. Someone always apologizes for the marketer, or talks about how clever the campaign was, or simply refuses to believe that the marketer is doing anything unethical. As someone pointed out, there *is* something unethical about these campaigns; they abuse the trust we place in someone for appearing to be independent from the organization, thus enabling them the ability to give what appears to be an unbiased review.
The only negative publicity we can deservedly give these hype-sters is non-publicity. Don't go nuts when a fraud or hoax is exposed; simply ignore it. You'll probably forget all about it in another week.
mandelbr0t
"Please describe the scientific nature of the 'whammy'" - Agent Scully
Viral as i've always played it is using something like...
... you get the idea...
Come to my business..
We take a photo of you enjoying yourself.. (with your permission)
We make the photo available to you online...
We allow you to send the photo to your friends (or rather links to the photo)..
A business "planting buzz" is just that.. it's a gorilla technique but if it's paid for, it's paid for, and that isn't speech it is commercial speech.. I would like those two to be treated the same but the law doesn't see it that way..
Commercial speech that is misleading is usually called fraud.. The particular fraud would seem with "good buzz" to be aimed at lowering the transaction cost, the risk that some new product or service sucks... sucking in consumers to making purchases based on false endorcements and recommendations..
Hell, I don't even know what my point is in posting... I guess I just wish that more people would question these things and take a stand against them, because that is the only way they'll go away. But most people just don't seem to care.
My beliefs do not require that you agree with them.
...And let me tell you guys: This new program from the FTC is excellent. Don't listen to what those Capitalism(TM) and Free Speech(TM) fanboi's tell you.
"By the time they had diminished from 50 to 8, the other dwarves began to suspect 'Hungry.'" -Gary Larson
No. Let me remind you how our system works:
1. Person finds something they think is cool.
2. Person submits link and story to Slashdot.
3. Slashdot editors do a quick read to see if it's not blatantly inaccurate or uninteresting.
4. Editors put the story up.
5. Readers check the story out.
5. a. At least one reader looks into (or already knows) the background of the article.
5. b. At least one reader looks into (or already knows about) the subject of the article.
5. c. At least one reader looks into (or has already speculated about) the ramifications of the article.
6. We discuss.
That's the point: the community decision for the article you linked was that it was a guerilla campaign. When I read that article, I didn't realize it was such, I assumed the same as the editors. Fortunately, there's a large community here, several of which commented that not all was as it seemed, and I was enlightened.
Yay for community discussion. Articles aren't generally statements that the community makes, they're statements that the community responds to. That's why us old timers (and I'm a young'un, at that) are still here.
I [may] disapprove of what you say, but I will defend to the death your right to say it.
Yeah. Look for updates to this over on TechCrunch - here.
Simpy
I'm shocked, shocked I tell you to find that deceptive advertising is going on. I mean it's not like they, as in the ubiquitious they, think people are malleable, easily led astray, brainwashed, etc, etc.
De Beers has the longest running viral marketing campaign in history. It started in the 1880's and is still going strong today.
"You'll get nothing, and you'll like it!"
Okay, start 'fessing up to it - about half of you are M$ shills, aren't you?
This might go beyond merely corporations. Affiliates may also be required to disclose the fact that they're paid for their links.
Or, more specifically, the affiliate networks & companies involved may be forced to require affiliates to do, since the networks/companies are the ones who'll be getting the fines.
Read Copyblogger's excellent post on this subject for more details.
I'm a dreamer, the world is my playpen. But hey, I'm a serious person, I can't dream all the time.
I thought viral marketing meant that you use your product to advertise your product. For example, Yahoo mail always has a link at the bottom allowing the recipient to sign up for their own yahoo mail account. If you get a geocities webpage, it will have a link for your website viewers to sign up for a geocities account. In other words, the service provider is using you to advertise their product as you move around in your online world (via email, or websites, avatars, or whatever. It is the electronic equivalent of having an alligator on your golf shirt, or a swoosh on your shoes.
When our name is on the back of your car, we're behind you all the way!
Part of me wants to think this is a good thing. That consumers don't deserve to have products shoved down their throats and be saturated by advertisement all day long. This part of me also thinks that if companies could, they would advertise directly into our dreams ala that one Futarama episode: http://www.futurama-madhouse.com.ar/scripts/1acv06 .shtml
Fry: So you're telling me they broadcast commercials into people's dreams?
Leela: Of course.
Fry: But, how is that possible?
Farnsworth: It's very simple. The ad gets into your brain just like this liquid gets into this egg. [He holds up an egg and injects it with liquid. The egg explodes, covering him and Leela in yolk.] Although, in reality, it's not liquid, but gamma radiation.
Fry: That's awful. It's like brainwashing.
Allthough the other part of me thinks that you get what you deserve. If you aren't smart enough to make your own purchasing decisions and are easily swayed by ANY marketing, be it on the Television, Radio, directly in your brian, or some hobo on the subway telling you how bad ass the new PSP is; then as a fool, you deserve to be parted with your money.
What's with all the negative reactions? Are all the shills coming out, worried that they'll have to get a real job instead of being paid to post on slashdot, or what?
Deceptive advertising is deceptive advertising no matter what medium carries it. The government is right to crack down on this kind of fraudulant business practice, because it damages the free market by denying people the ability to make informed decisions regarding their economic activity. Remember, the free market works on the principle that individuals know best (certainly better than government) how to allocate their resources, and that these individual choices will, in aggregate, result in a more efficient distribution of resources/wealth than any command economy. This breaks down if deceptive marketing tactics prevent individuals from knowing best. A corporate command economy is no better than a government command economy.
My devil's advocate reaction to this is, "not necessarily." If company X didn't have to spend a billion dollars to counteract company Y's $900 million advertising budget, they could use that money to help save consumers dollars. Or they could put it into R&D and engineering to actually make a better product instead of just telling us it's a better product.
Also, I (and a lot of other people) are more than willing to pay a premium for ad-less products. Does anyone remember the days way back when most cable channels didn't have ads? Now you have to pay the cable company for channels with ads, and the channels that don't have ads are very expensive. (Yet notice how they still have a lot of subscribers for that premium.)
I myself don't watch ads on television at all. Every show I want to watch, I either get via iTunes download for $2 a pop (or a season subscription), or by less scrupulous means that I don't want to go into if it's not available by any other means (wink, wink). I have a few small web sites I run for personal reasons, and I buy the hosting space at a reasonable non-free price so that I don't have to subject my visitors to a barrage of ads. I run Firefox with AdBlock so that I can avoid as many ads as possible while browsing the Internet.
I still run across ads now and then, as they're unavoidable in society. The point, though, is that I still spend plenty my share of disposable income, companies still make plenty of money off of me, but they have to do it by actually having products of decent quality that I want or need, not by yelling in both my ears constantly.
In other words, there is another way.
Personally, I think the best advertising any company can have is virtually free. It's from friends who have products and tell me about them. It's from reputable website reviews that describe up-and-coming technology and products. It's from companies' own websites that provide as much real information about products I'm interested in as I need to make an informed decision. All of these things are dirt cheap compared to the billions that companies spend on radio, television and web ads that I never see or hear. Go figure.
Amen.
you can find that comment here:
http://yro.slashdot.org/comments.pl?sid=211606&cid =17228420
suppose a lot of people start passing that around by email and in blog posts and it "goes viral" - will I get in trouble?
I'm a grown-up. I don't need the Federal government to protect me from viral advertising.
For my entire life, I've been exposed to celebrity endorsements, and the only effect has been to fine tune my bullshit filter.
Please refund the portion of my taxes that is going to paying these guys salaries.
We have created a system that institutionalizes lies and deception and has created universal suspicion. The public relations industry, and thats what this story is really about, reaches into EVERY aspect of our lives. One of its fundamental tenets is that good pr is totally invisible. If the mark knows he is being fed pr sh1t, his defenses go up. It is truly an insidious profession. Anyone remember the Hill & Knowlton Kuwaiti/Iraqi war effort? If not, they invented the story about the iraqi soldiers removing premature babies from incubators and leaving them to die on the cold floor. They even had people testify before congress. It was the single most emotional reson that swung public opinion behind the war. Yet no one went to jail because of it. Then there is pr news stories that are broadcast as news stories, etc etc.
To see how a jounalist dissects a pr movement, you might want to check out the excellent book: Secrets and Lies: The Anatomy of an Anti-Environmental PR Campaign. It is quite sobering.
I'll leave you with a quote from Orwell: "In a time of universal deception, telling the truth is a revolutionary act." And we are currently drowing in bullsh1t.A model for understanding how and why memes propagate across the Internet. I originally intended this as a supplement to my Meme Miner tool, to validate its predictions, but it's coming in handy for other reasons.
y =updated_ideospheric_sampling_model
http://www.realmeme.com/roller/page/realmeme?entr
Because when Microsoft, who funds SCO, makes shady deals followed by spurious claims engages in viral marketing, it's OK.
But when Sony, who delivers Linux on their console does it, it's BAD.
Yeah must be Wednesday again.
Don't think of it as a flame---it's more like an argument that does 3d6 fire damage
What a splendid pie,
Pizza-pizza pie,
Every minute, every second,
Buy, buy, buy, buy buy.
What a splendid pie,
Pizza-pizza pie,
Every minute, every second,
Buy, buy, buy, buy buy.
Pepperoni and green peppers,
Mushrooms olive, chives,
Pepperoni and green peppers,
Mushrooms olive, chives.
Need therapy, therapy,
Advertising causes need,
Therapy, therapy,
Advertising causes need,
Therapy, therapy,
Advertising causes,
Therapy, therapy,
Advertising causes,
Therapy, therapy.
Advertising causes...
Therapy, therapy
Advertising causes,
Well advertising's got you on the run,
Need therapy, therapy advertising causes,
Well advertising's got you on the run,
Need therapy, therapy advertising causes,
Well advertising's got you on the run,
Advertising's got you on the run,
Advertising's got you on the run,
Advertising's got you on the run.
I couldn't have said this better myself.
I hate this whole free speech arguement being brought in. It's a business producing commercial speech it should be regulated as such!
Well said!
Oops, how did this get here?
09 F9 11 02 9D 74 E3 5B D8 41 56 C5 63 56 88 C0
Critical Thinking, in my experience, is often written off as Cynicism by people who don't understand see the importance in thinking for themselves. These people are either in denial about their reality, or are honestly lacking the skills needed to examine it.
I find it hard to understand how anybody watching could miss the (usually obvious) manipulation tactics used in the media every day. People seem to have a very high tolerance for being manipulated and lied to.
The most recent ad that's got my goat is a TV commercial for some subsidiary of Virgin Group. It very explicitly depicts evil men in suits being overpowered the beauty of nature, a colourful fish reversing the flow of toxic waste, plants and animals growing. It uses happy music and bright colours and is very obviously trying to say "we're really sticking it to the man!"
This isn't technically a lie, but come on! It irritates me that it's socially acceptable to be so completely dishonest. It irritates me further that so many people can't see what's going on.
Such blatant dishonesty and trickery as is used in all forms of advertising seems to undermine the entire idea of communication in the first place. Instead of encouraging cooperation, it creates an us-against-them situation where the them (the public at large) don't even know they've got to be on guard.
and thanks for insulting my intelligence with your fake blog. Can I please have that kick in the
balls now?
This new term will catch on like... like a... a bacterial infection.
In the literal sense, corporations do not speak. People who work for them do.
Let's say I work for a studio that is producing a new movie. If I go out on a movie forum and say "Have you heard about this movie that's coming up? It's going to be pretty cool!!!", that could be considered viral marketing.
So, what if it's true, and I really believe it? Even if it's not, you can't prove that it's false or misleading. An opinion, by definition, is subjective.
Also, where do you draw the line? I'm a software engineer. Am I not allowed to say good things about my company's products when I'm making the rounds at Christmas parties? Do I have to preface it every time with, "FYI: I'm an employee of X company, and my opinions my be influenced by that."
And, if it was mandatory to identify yourself, that's very difficult to enforce. Online, it's easy to be relatively anonymous. And, if I'm talking about my product and I don't properly identify myself, what are you going to do, throw me in jail? Fine me? What is a fitting punishment for the crime of stating an opinion in the improper way?
I can see your point that it can be misleading and untruthful. However, regulating it is impractical and unfeasible, not to mention clearly contrary to the first amendment (I don't think your comparison to insider trading laws really holds water).
It is each of our jobs as an internet citizen to determine what information on the web is good, and what is total crap. That's the way it's always been, and I genuinely hope it remains that way so that we don't start down the slippery slope toward internet censorship.
I [may] disapprove of what you say, but I will defend to the death your right to say it.
Leela: "Didn't you have ads in the 20th century?"
Fry: "Well sure, but not in our dreams! Only on tv and radio...and in
magazines...and movies. And at ball games, on buses, and milk cartons,
and t-shirts, and bananas, and written on the sky. But not in dreams!
No sirree."
-- Futurama
Well, at least viral marketing can be killed instantly by the negative karma that comes about when the blatant lies of this being an 'enthusiast's user opinion' are uncovered.
Viral marketing does not require astroturfing. A company can legitimately engage in viral marketing by being supportive of actual users and fans.
This is a non-issue. People will buy or not buy what they like, and all the astroturfing in the world can't polish a turd.
-jcr
The only title of honor that a tyrant can grant is "Enemy of the State."
These sort of ads are making me cynical. I sent the following email to a mate of mine:
http://www.1up.com/do/my1Up?publicUserId=5809893
Does a chick this hot really have a blog on a games site or is this some bullshit viral marketing ploy.
To which he replied:
NO SHIT, this is quite funny that you send me this today! quinn just showed me this girls photos on a dating stie yesterday and said that no one ever gets a reply from her. Shes probably dead and so lost all rights to her images, well thats a bit dark. Man she's hot other wise.....might send into her add lol
IANAL but isn't it illegal intentionally mislead people with advertising?
You can't take the sky from me...
Am I the only one amused by the fact that /.ers posted an article about the FTC investigating viral marketing on the same day we posted an apparently bogus story that turned out to probably be a viral marketing ploy?
The first principle is that you must not fool yourself - and you are the easiest person to fool. -Richard Feynman
One thing I hate is marketing directed at children... technically speaking, a child cannot legally enter into a contract. But they can beg their parents for a product. If children truly can't make informed decisions, an assertion I agree with, then it logically follows that advertising to such persons should be 100% illegal.
In other Federal trade commissioning news the FTC is going to investiagitate its relevance to Funeral Homes: FTC Tests Funeral Homes for Compliance With Funeral Rule; New Brochure Explains Consumer Rights Under Federal Law note, new brochure has been published. As a person who, in my years of experience has put together something on the order of a brochure, I know that it is a non-trivial amount of work, so if you or someone you love is planning on a funeral, I suggest you pick up this informative booklet.
On the note of viral marketing the following stream of consciousness riff; I'm a Pepper, less filling, where's the beef, <psp graff>, ok go!, my street team (currently putting stickers on your local gray metal municipal boxes), this video (marketing my current 'hood as a nice place for a monday drive), suburban blend, {yahoo cool site of the day, justin's links from the underground, memepool, metafilter, fark, digg, del.icio.us, reddit} oh it's six o'clock a decade later... I guess it's time to go home again.
beedoop.
Viral marketing is quite often an attempt to encourage users to pass on your marketing material without any financial inducement.
c ks-down-on-word-of-mouth-advertising/ s closure-now-required-by-law/
As soon as there is an additional incentive, it becomes much more like affiliate marketing.
Some incentives might be included that are not financial, such as unlocking access if you get 3 friends to sign up.
The biggest problem with the FTC statement is with Affiliate marketing, especially where a marketer is offering a recommendation regarding a specific product, with the ability to link directly through to that product with a CPA or affiliate link.
On stuff like this you listen to lawyers, and consult with them if you are in any kind of internet business.
Here are some references to what 2 lawyers have written about this.
http://www.copywritersblog.com/2006/12/13/ftc-cra
http://www.copyblogger.com/affiliate-marketing-di
This affects Amazon, Google, Ebay, Clickbank, Commission Junction, Linkshare and a host of other billion dollar companies that allow affiliates to link directly through to a particular product or service with a recommendation.
Disclosure: I practice disclosure on my blogs and use affiliate links recommending products, and have an interest with this as I just launched a disclosure policy plugin for Wordpress. It is available free of charge and is GPLed
http://andybeard.eu http://disclosurepolicy.com
"In advertising there is no such thing as a lie, there is only expedient exaggeration."
Roger O Thornhill (played by Cary Grant) in "North by Northwest".
Hey guys, I'm finding reading this story really easy on the bright, crisp screen on my new white Apple MacBook laptop (with a whopping 2Gb of fast RAM that was simple for me to install, without voiding my warranty). Anyway, thanks for an interesting read, and now I'm off to surf some internets while downloading excellent tracks from iTunes thanks to my Apple MacBook's excellent multitasking capabilities.
Cress, cress, lovely lovely cress
You, as well as a couple of other commenters here on /., seem to be confused about the what viral marketing is.
/.er, but the Halo ARG wasn't viral marketing because there was no deception.
ilovebees was not viral marketing. Why ? Because every player was fully aware it was a promotional game for Halo 2, right from the start.
The site was linked from a Halo 2 trailer, for crying out loud ! There was no doubt whatsoever regarding the origin and the purpose of the site : every person who took part in the game knew it was part of a Microsoft/Bungie marketing campaign for an upcoming game. I'll grant you that it wasn't explicitely said, but the origin of the link and the setting of the game were enough to clear any lingering doubt for anyone with half a brain.
On the other hand, viral marketing is, for example, someone praising (or badmouthing) a product while pretending s/he is an everyday Jane/Joe expressing her/his own opinion (while s/he is actually an actor part of a marketing ploy). This is so widely hated because the very foundation of viral marketing is deception : advertising trying to pass off as the genuine opinion of an independent consumer. That's low as shit.
Trust me when I say I dislike MSFT as much as the next
Now that I gave you the tools to identify viral marketing, let me say this as an aside :
It kind of pains me to admit it because I can't stand the Xbox Halo games, but ilovebees was brilliant and a very good example of how good an ARG can be (although it wasn't very effective as advertising, because I still loathe Halo). ARG amateurs had a really good reason to take part in this game, even if it was advertising. MSFT gained something, but the players did too.
alliwantforxmasismypsp, on the other hand, is so dumb it's insulting. It's shit. It's only good at arousing curiosity, and time spent checking it out is wasted because it doesn't offer anything. It's eating away your time and it's a net loss because you have nothing to gain in exchange for your participation in the ad campaign (unwitting participation, remember, that's precisely why it's viral marketing, wolf in sheep's clothing).
There are ads in TV shows and movies. There are ads in every retail store. I see ads on buses, storefronts, people's clothing, and in every house I've visited.
I'm repulsed by this parasitic ubiquitous curse, but I don't delude myself that I'm ad-free just because I skip ads and use filterset G.
Man, you really need that seminar!
Yeah. I had had a couple more points to make in that last post (like how he has NO place to judge you because he knows next to NOTHING about you), but could literally feel my blood pressure sky-rocketing, so I cut short. I'm out.