By Daniel Warner
Over the past year, Amazon’s Fulfillment program (a.k.a., “Fulfillment by Amazon” or “FBA”) has exploded by a whopping 65 percent. That’s a whole lot of new e-commerce businesses, and a fresh hunting ground through which the Federal Trade Commission can prowl.
To wit, we’ve compiled this introductory legal guide to online marketing. Is it exhaustive? No. But it’s a solid starting point for anyone interested in regulations and guidelines that affect the FBA niche.
Don’t Lie
It’s pretty straightforward: don’t lie to consumers. If you do, the FTC will Barry Allen its way to your doorstep—in a flash. The crux of the matter is it’s against the law to lie to consumers. It’s also unlawful to exaggerate claims or misrepresent studies. And in FTC Land, lies of omission are lies. Period.
Skeptical of the FTC’s actual power? Click here to read about a current crackdown in the dietary supplement niche. The FTC investigated over 100 manufacturers and marketers, primarily for misrepresenting studies and using language that broke the truth barrier.
Disclose
Disclose, disclose, disclose! To avoid unwanted attention from the Federal Trade Commission, use proper disclosures in your agreements and marketing material. If you depict atypical results, say so—in clear, concise findable type—directly next to, below or on top of the image or statement.
Don’t quote fake studies. Don’t exaggerate findings. If you compensate someone for tweeting, Facebooking, Instagramming or otherwise promoting something on social media, make sure that person’s post includes a #sponsor, #paid or #ad hashtag. (Yes, you’re responsible for *affiliates* promotional actions.)
Don’t be tricky. The FTC lives for catching and fining rule breakers–it’s the agency’s raison d’être. And FTC penalties are nothing to ctrl-alt-delete at. Believe it or not, the agency can fine you and confiscate luxury goods. In some cases, it’s even authorized to repossess houses and items listed under family members’ names. That Rolex you bought your father last year? The FTC may be able to snatch it.
Familiarize Yourself With the Dot Com Disclosures
What’s the best advice a Fulfillment by Amazon lawyer can give to aspiring online marketers? Read the Dot Com Disclosures!
Fact: Reading the Dot Com Disclosures is about as interesting as other people’s vacation pictures. (The only difference? You don’t have to *oooh-and-ahhh* at the Dot Com Disclosures.) So, if you’re not a “technical writing fan-boy or -girl,” read this summary on the FTC website. If the summary is too boring to stomach, then spend a couple of hundred bucks on an online marketing attorney who will audit your campaign and save you the numbing hassle of plodding through the FTC’s guidelines.
Commonly Asked Online Marketing Law Questions (& Answers)
Is it okay to use fake testimonials? Essentially, fake testimonials amount to lying. As discussed above, lying is a marketing no-no, a fine-inviting faux pas. Many people chance it, but those people are playing with fire. If you land in the FTC’s crosshairs, agents have every right to ask for testimonial proof—and agents can spot fake proof as easily as gold diggers can spot a lonely, 90-year-old millionaire.
What happens if the FTC catches you posting fake testimonials? Most likely, you’ll be saddled with a hefty fine and forced to sign a “mea culpa” statement, in which you swear to never-never-ever engage in deceptive marketing ever again.
Is it okay to use fake news sites? It’s not kosher to use fake testimonials and the same goes for fake news sites. The FTC loves to bust businesses that use fake news sites. They hunt for them and demand payment upon capture. Back in the Wild West days of the Internet, fake news sites were perfectly legal—and oh so common. That’s no longer the case. Use them and risk serious financial hardship, courtesy of the FTC.
Can I legally buy reviews off of sites like FIVERR? Sure, you can legally BUY reviews, but once you use them, you’re breaking the law. The FTC has made it clear, under no uncertain terms, that paying money—or in some way compensating people to write reviews–is trickery that won’t be tolerated.
Can I have friends and family leave glowing reviews on my Amazon product pages? You have a brilliant idea: “I’ll just get my friends and family to post positive reviews on my products. After all, they’ve used my product and love it. It’s not like they’d by lying.” Guess what? It’s not that simple.
In reality, the FTC isn’t fond of “friends and family” reviews. Now, of course, it can’t stop your relations from weighing in on your product—that would be unconstitutional. However, if agents really wanted to, they could make an argument for “deceptive marketing.” So, what’s the solution? Simply have your friends and family disclose that information when leaving an online review of one of your products.
Moreover, Amazon.com seems to forbid undisclosed “Friends and Family” reviews in its terms of service. So, again, if your buddies do leave reviews, make sure they add disclosures to their posts.
Can I leave bad reviews on a competitor’s pages if I truly think they’re offering sub-par products? All’s fair in love and marketing, right? So, posting a terrible review of a competing product is just part of the game, right? Wrong. Doing so could force you into the FTC’s doghouse, where paying huge fines is the only way out. More than that, your competitor could successfully sue you for defamation or trade libel.
Can I send DMCA takedown notices to competitors who are stealing my marketing content? Is someone scraping your content? Ripping off your promotional articles or videos? If yes, you can send a DMCA takedown notice. Be aware, though, that rules do apply. Speak with an attorney about the specifics of your situation, and then he or she can point you in the best direction.
What’s the deal with stock images; can I use them in promotional materials? Here’s a good rule of thumb regarding stock photos: if you buy it, you can almost certainly use it online; if you yank it off Google Images, there’s a reasonable chance you’re infringing on a copyright.
Always check if someone owns an image and if they require compensation for their work. Sometimes, artists and photographers only require credit. Plus, in today’s age, many images are released under various creative commons, meaning anyone can use them for editorial purposes (with proper credit), but not commercial ones. In other words, you can use it on a website to accompany an article, but you can make products, which feature the artwork, for retail distribution (i.e., t-shirts, mugs, etc.).
What are the rules regarding text message marketing? The same laws that apply to telephone telemarketing apply to text message telemarketing. If you want to text message customers, get permission first. The FTC has—and will continue to—track down and fine people who text message SPAM. Moreover, if you send promotional text messages to consumers, include a hashtag disclosure like #ad or #sponsored or #paid. (Same goes for any social media promotions.)
Make Friends With an Online Marketing Lawyer
In today’s marketing-first world, it’s good to have a friend who knows a thing—or fifty—about online promotions and the Fulfillment by Amazon program. One small mistake can lead to an account suspension and halt your income flow. So, start by working with an FBA lawyer; the small amount it costs to correctly establish an e-commerce venture may safeguard your profits in the long term.
The post Does Your Business Use Fulfillment by Amazon (FBA)? Read Our Introductory Legal Guide appeared first on AllBusiness.com
The post Does Your Business Use Fulfillment by Amazon (FBA)? Read Our Introductory Legal Guide appeared first on AllBusiness.com.
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