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Lawyers Brenda Pritchard and Susan Vogt recently released the 5th edition of Advertising and Marketing Law in Canada. Published by LexisNexis Canada in association with ACA, it’s a comprehensive reference tool that will help advertisers and marketers better understand the breadth and complexities of Canadian regulatory law. This excerpt provides tips on how to stay above board with product and consumer reviews.

FACEBOOK AND TWITTER DISCUSSIONS

As advertisers compete voraciously for consumer facetime on their social media pages, the question that invariably comes up is whether the consumer references to third party brands, celebrities, movies or the latest CD release on the advertiser’s branded pages amounts to misappropriation of personality or implied endorsement. While it is consumers who are generating this content, it is often the advertiser who promotes the content with tweets such as “What famous person would you most like to share a cappuccino with at our café”?

In fact, the celebrity named may not like coffee or, worse, may be tied to another famous coffee brand under an exclusive arrangement. Until the law is clarified in this area, advertisers are well advised to exercise care when creating their posts.

1. Implied Endorsement

   Famous actors often tweet about their latest “find”. It is well known that Oprah Winfrey has single-handedly made a brand or book famous by virtue of her implied or even overt endorsement. While at first blush you may have hit “pay dirt” with an unsolicited endorsement, it does not follow that you are allowed to then take that endorsement and use it to promote your brand without the consent of the endorser.

2. Engaging Bloggers or Social Media Influencers

   It is now customary to engage social media influencers (“SMI”) to push consumers towards your social media activation. These bloggers or SMIs will — for a fee — engage their followers in a discussion about your product or contest, and candidly disclose that they have received money or “in kind” to do so under the WOMMA (Word of Mouth Marketing Association) and recent Federal Trade Commission guidelines.

The law becomes increasingly foggy where those SMIs engage in their usual gossip about celebrities on the same website where they endorse your brand. What was formerly protected free speech is now treading into branded advertising. You are well advised as an advertiser to require your bloggers to avoid any reference to third parties or you run the risk that you, as the “deep pocket” advertiser, and not the SMI, will be on the receiving end of a lawsuit.

How do you deal with bloggers, Vloggers, brand ambassadors and Influencers?

Blogging is a burgeoning cottage industry for aspiring writers, small business owners and even stay at home moms and dads. The challenge for the blogger is to monetize their writing by getting paid sponsors, served ads and “brand partners”.

Since research shows that consumers tend to believe testimonials and product endorsements from “real people” more than direct brand sell, the most influential bloggers will find themselves inundated with requests to try new products and more importantly to get their followers to not only try the products but comment favourably about them.

What is clear is that these “arrangements” should be detailed in a written agreement between the advertiser (or its agency) and the Influencers, covering among other things:

1. the respective responsibilities of the parties;
2. arrangements for delivery of samples of products for Influencers and their followers to try or be awarded as prizing;

Word to the wise: Restricted products such as drugs, natural health products, alcohol and tobacco products cannot be given away without consideration.

3. the frequency and number of posts the Influencer is expected to deliver;
4. a Code of Conduct to be followed in terms of both posts and conduct of the Influencer/ambassador at public-facing events;
5. the consideration to be paid to the Influencer and the agreed method of disclosure of that payment (See WOMMA/Cole Hahn discussion below); and
6. any exclusivity arrangements during the term of the agreement to protect against dilution of the Advertiser’s brand during the promotion.

Astroturfing – Faking Grass Roots Support

In an ideal world, the promotion of the advertiser’s brand will be organic.

The Influencers will mention that they tried the product and loved it and their followers will be motivated to try it and share it with their friends, thereby creating grass roots support for the brand which will hopefully go viral.

Astroturfing, according to Wikipedia, is the practice of making a message posted by a sponsor or organization appear as though it originates from and is supported by grass roots participants.

Less scrupulous advertisers would hire employees or independent contractors as Astroturfers to create fake testimonials using software to mask their identity, creating the impression of massive support. Those Astroturfers who use multiple identities to fake support are known as “sockpuppets”. These “sockpuppets” are motivated to create detail behind their various fake personas by being paid for each post that is not taken down by moderators.

Astroturfing is just another method of misleading advertising and, even in countries where specific legislation does not exist to prohibit the practice, there will undoubtedly be broad legislation to prevent it, if detected.

On the point of detection, in Canada, the Competition Bureau has identified the following as signs of possible astroturfing:

• A product or service has suddenly received great reviews.
• The reviewer only recently created a user profile and has been actively providing positive feedback on a handful of products over a short period of time.
• The reviewer’s tone is overly positive.
• A fake review from a competitor may discredit the product while suggesting another.

In response to the prevalence of this new problem the Competition Bureau has also provided consumers with the following list of suggested ways to protect themselves:

• Consult multiple sources in order to determine which reviews are legitimate.
• Search for reviews over a wide range of time.
• Disregard the highest and lowest ratings — see what people in the middle are saying for a more accurate assessment.
• Online reviews should only be one step in researching a product or service and take all feedback online with a grain of salt.

While more prevalent in the U.S., complaints of astroturfing in Canada have been filed with the Competition Bureau, which has indicated that it is aware of, and is “looking into”, the practice.

ACA members: Join Gowlings’ Partner Brian Fraser Nov. 10 for an ACA webinar to have your questions about Advertising and Marketing Law in Canada – 5th Edition answered.