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."

Comments

Astroturfing

[duerra]

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.

About Time

[Slipgrid]

60 Minutes covered this about two years ago. It's a good segment if you can find the video.

Re:How low can they go?

[Possibly Malignant]

"if X says this and X is a nice guy, then X must be true"

There's a syntax error in your formula.

The Sony Strain...

[__aaclcg7560]

Does this mean that Sony will get a marketing flu shot?

Ha, I'm immune

[StikyPad]

since a) I don't talk to anybody, and b) even if I did, I wouldn't trust what they said.

Sigh.

OT: Community redemption.

[Spaceman40]

[Is] [Slashdot] trying to [redeem] itself after being conned into an instance of viral marketing?

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.

Re:How low can they go?

[troll -1]

Free speech is free speech. Just be happy they aren't transmitting commercials into your dreams (yet).

This is considered commercia speech and doesn't have the same First Amendment protections as other speech.

Re:How low can they go?

[dgatwood]

Precisely. The word you're looking for is "dramatizations". And you are required by law to disclose when this occurs.

I cite 45 FR 3872, section 255.2:

(b) Advertisements presenting endorsements by what are represented, directly or by implication, to be ``actual consumers'' should utilize actual consumers, in both the audio and video or clearly and conspicuously disclose that the persons in such advertisements are not actual consumers of the advertised product.

And section 255.5

When there exists a connection between the endorser and the seller of the advertised product which might materially affect the weight or credibility of the endorsement (i.e., the connection is not reasonably expected by the audience) such connection must be fully disclosed.

Now, admittedly, this is from an FTC guide and not directly from the relevant body of law. You'd have to ask somebody more familiar with the details of advertising law to tell you which specific sections of code and/or relevant case law that these opinions are derived from. That said, the FTC is well within their rights to investigate this and prosecute any ad agency proven to use guerilla marketing tactics. They are clearly examples of false advertising, and are thus NOT ethical and NOT legal.