Government Issues
When it comes to limits imposed by federal and state regulators, marketers could find they’re facing more obstacles to a fiscal recovery than just getting their mail delivered six days a week. Here’s a quick rundown on some of the initiatives now under consideration.
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Federal Trade Commission: As noted elsewhere on these pages, the FTC is looking at marketers’ practices on targeting ads using data collected over the Web. But the agency isn’t waiting patiently for self-regulation to happen. Just last month it finalized a consent order to force Sears Holdings Management to destroy data collected on users who downloaded tracking software from the company. While not alleging users were harmed by giving up this data — they saw no pop-up ads and in fact were paid to take part — the agency said Sears’ failure to clearly disclose the scope of the collection was actionable.
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The FTC is also writing new tougher guidelines for disclosing when bloggers have been subsidized with cash or free products to write favorable reviews or brand mentions — “blogola,” in new media-speak. Industry groups of advertisers and PR reps are moving on their own best practices to forestall such an outside solution. But the answer may come from Google, which has started downgrading blogs that engage in pay-for-play in its organic search results.
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Food and Drug Administration: By requiring General Mills’ Cheerios to stop touting its benefits in lowering cholesterol and treating heart disease, the FDA has signaled a will to scrutinize the marketing of “nutraceuticals” — foods that promise health benefits from added calcium or folic acid, dairy products with live bacteria cultures and so on — and force them to undergo the application process faced by all drugs coming to market.
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Federal Communications Commission: The FCC is on the verge of writing new, possibly tougher rules about product placements in broadcast TV. Consumer advocates want placements highlighted onscreen the moment they occur; marketers are hoping that disclosure among closing credits will suffice. The tactic has grown prevalent over the years as more viewers zap commercials and with the rise of reality TV. Last year, Nielsen found that “Top Chef,” “American Idol” and “The Apprentice” led the placement pack.
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U.S. Department of Justice: DOJ is currently vetting the proposed ad pact between Yahoo and Microsoft’s Bing search engine for antitrust violations. The decision in that case could determine whether marketers work in a world dominated by one search giant…or two.
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Some activist state governments are cracking down on “astroturfing,” fake blogs and reviews set up to shower sham praise on marketers’ products, an FTC violation. In July New York AG Andrew Cuomo secured a judgment against a chain of cosmetic surgery centers for offering phony consumer reviews on supposedly independent Web sites.
