Jim Edwards from igottatellya.com recently interviewed Richard Cleland from the FTC and posted both a video webinar and downloadable transcript on his site.

Check it out here.

If you’re concerned at all about how these new rules will affect you, head on over to Jim’s site and watch/listen or download the PDF. This is the best and clearest explanation I’ve heard so far. Jim did a great job with his questions and asked all the questions that would normally concern affiliate marketers, especially those that deal in the internet marketing niche.

He also showed Richard a couple of his sites and asked very specifically whether he would have to change his testimonials and or copy in order to be within the new guidelines. I was surprised at a couple of the answers. I initially thought that Mr. Cleland would say that one of the examples was not acceptable, but he simply said that only some of it was questionable and he would recommend editing it to remove some parts dealing with the “typical results” rule.

Also, I found that Mr. Cleland did not seem to be on any kind of mission to kill internet marketing at all. I believe the FTC is not doing anything but trying to protect consumers from obvious con-artists. This however does bring me back to my rant post in that we shouldn’t have to protect people from the obviously hyped and untrue advertisements. My thinking is that the FTC could probably serve the public better by educating the public on how to spot the scammers.

By shutting down scammers you are in effect giving the people who would be hurt by them a fish. By educating those same people on how to spot the nasty marketers you would be teaching them to fish. In my opinion that’s always a better solution to any problem.

Here’s that ink again.

Check it out here.

Until next time,

Wishing you success in everything you do!

Ken    

OK… I just can’t help it.

I wrote a post about the new FTC Rules and Guidelines from an affiliate marketer’s point of view today. I tried to give my take on it in a professional manner. This turned out to be more difficult than I had anticipated. I couldn’t focus on the task at hand because my mind kept wandering to the real root problem and why these rules had to be created in the first place.

In short, a rant was forming in my mind the whole time and I just couldn’t get rid of it. So after much struggling to finish the first article, here’s what I really wanted to say!

I don’t apologize for being an affiliate marketer. As a matter of fact, I’m proud to be an Affiliate Marketer. It’s a tough business that takes honest work and continuous learning. Anyone that tells you otherwise is lying.

If the FTC is listening, here’s my MO when affiliate marketing.

I don’t promote or review any product I haven’t bought and/or used myself. This isn’t to say that I don’t get freebies from time to time in the form of Joint Venture offers. On occasion, marketers send me a link to their product for free in hopes that I’ll review or promote it. Guess what? Sometimes, if the product is truly has value and can help my readers, I do!

However, 99% of the time I review and/or promote only products that I have bought and USED to generate income. In other words, I do not under any circumstances promote something that I haven’t tried and at least had some success with. What I mean by “some success” is at least getting my purchase price back plus a couple hundred percent for my time.

But this really isn’t even enough for me to start promoting a product or course in Internet Marketing. There has to be true value in the form of online marketing education mixed in there somewhere. In other words, as the old proverb goes, teaching someone to fish instead of giving them a fish.

I market ethically. I only promote products, systems, and courses that I believe in.

The only way to be truly successful in online marketing is to learn continuously. I have purchased thousands of dollars worth of Internet Marketing courses, instructional videos, scripts, and all manner of learning tools regarding IM.

Have I been burnt? Of course. Am I going to “run to mama” and report these unscrupulous marketers to the FTC? No. To me it’s all about taking personal responsibility. But I guess in this day and age personal responsibility is an outdated ideal.

It could be my age… it could be the way I was raised. It could be as simple as getting burned when I was a young boy by the X-Ray glasses and Amazing Sea-Monkeys that I bought from the back of a comic book. I couldn’t wait to run home and look at the amazing cities that my sea-monkeys (brine shrimp) had built while I was at school looking through my magic glasses seeing right through my second grade teacher’s clothes. (Hey, she was gorgeous and only 24!) That’s a disappointing lesson that stuck with me for life.

Back then we didn’t have an easy way to discover whether these products were real or not unless we had a friend who was as stupid as us that had already purchased them. Of course, half the time they wouldn’t admit to buying them and would actually encourage us to buy because they didn’t want to be the only one in the “I’m so Stupid” club.

Now we have the Internet.

The easiest way not to get burnt when deciding to purchase any type of “make money” product or system is to do a little research. How tough is that? Take the product name and add “scam” to it in a Google search and see what you come up with. Hit the marketing forums and see what others (preferably whom have already purchased it) are saying about it. Then do a search on the Author’s name and see if they are respected in the associated community. How tough is that?

In my opinion, anyone who doesn’t do at least a little due diligence is asking for what they get. Anyone who believes that they can get rich by pushing a button should know better. The fact that we have to police the Internet and protect people from their own stupidity is appalling to me. Do we, as a society, truly believe that most people are so stupid that they can’t even protect themselves from obviously hyped advertising? Are we, as taxpayers, required to protect lazy people from themselves?

Maybe this isn’t as much about protecting consumers as it is about generating revenue. Sure this is a cynical view, but it definitely wouldn’t be the first time rules were put into place with this, if not direct, certainly indirect goal.

So what are these new rules going to accomplish? Now, as affiliate marketers we are required to disclose that we make money if the person buys from our links. Also, if we display testimonials, we have to also include what typical results are.

I’ll tell you right now what typical results are for any Internet Marketing product. Over 90% of the people that buy a product or system for making money on the Internet will do absolutely nothing with it. They won’t even read it! 4-5% of the people buying the same exact product will make their money back and then some. 1-2% will take the system, work it as instructed, add some of their own ideas and experience, and make a fortune!

Nothing is stopping those 90+% from doing the same thing as the 1-2% except for laziness, lack of self discipline, lack of confidence, or lack of time. (There are obviously other reasons but these are the main roadblocks.) Should the advertiser be fined because of these reasons? Or should the purchaser take responsibility for their purchase and deal with it?

Here is some new sales copy that adheres to the new FTC guidelines for your promotions… feel free to incorporate it into your sales pages.

Please place this disclaimer under each of your testimonials that show excellent results:
The testimonial above was submitted by a person that can follow directions, is not an idiot, has a work ethic, is a self-motivator, is not lazy, has self-confidence, and because of these traits will no doubt succeed beyond your wildest dreams. You on the other hand, will probably not do anything and expect everything. You probably won’t make a cent because you are lazy and worthless like 95% of everyone else that purchases this product. Good luck!

Then watch the sales roll in!!!

Seriously though, take a look at my other (more professional) post for some tips that may actually help you stay in compliance and still be able to market effectively.

I’m sorry if this post seems harsh towards Internet Marketing newbies. I do remember how hard it was to learn all the things I needed to learn to get started. I remember how long it took me to learn these things. Fact is, I would not be where I am today without each and every lesson I learned along the way. I still learn something every day. I don’t see how anyone can protect anyone else from learning the hard way if that’s the path they choose. I know no one can protect me from learning things the hard way… I just won’t have it!

In summary, and keeping with the rant theme, these new rules will only keep the honest marketers honest. The unethical marketers will just get sneakier and still make a bundle. Just like the email spammers. As a matter of fact, they may make a whole lot more revenue than the rest of us since they won’t include disclosures and typical results in their pages, blogs, and advertisements. This will, in effect, make our sales copy look unexciting, even undesirable, by comparison.

Woo hoo! Score another victory for the unethical marketers at the expense of the ethical marketers. Nice job FTC!

Now my disclaimer… do I really believe everything I wrote above? Yes and no. There is much truth in things I said but I tend to always look for the silver lining in each cloud. This whole “FTC New Guidelines” issue, I believe, has been blown way out of proportion. Sure they are cracking down, but in many cases this is a good thing. All one has to do is to run across a fake blog or two when doing real research to see that this is a good idea.

I’m sure Google thinks it’s a good idea as well. After all they only want to give their searchers a good experience. Help Google do that and Google will help you. The Internet Marketing “make money on the Internet” niche already has a shady reputation due to wild claims and questionable “proof of earnings”. Be honest with people and you will be rewarded long term. And isn’t that why were doing this to begin with?

Thanks for reading my rant. However, lest you think I’m a totally negative person, please read my other (more professional) post concerning these new FTC rules. I do outline how I am going to adhere to the new rules while, hopefully, having as little impact on my businesses as possible. Here’s the link: Click Here

To our continuing success!

If you haven’t heard, the Federal Trade Commission (FTC) has made some major changes to rules governing what has to be disclosed in Blogs, websites, and Social Media.

For the ones who have a lot of time on their hands, these new guidelines are published at http://www.ftc.gov/opa/2009/10/endortest.shtm. I have read the entire guideline and here is my take.

First: let’s get the formalities out of the way. I am not a lawyer, never have been, never have wanted to be. But I’ve dealt with lawyers and the law and how it pertains to business on several levels. I’m no spring chicken and have been in business for a long long time. So, please read this post and then use your own judgment as to whether you should consult a business attorney to review your site(s).

Ok… let’s go!

Believe it or not, some people actually make money blogging and posting on Twitter, Facebook, Myspace, and other social media sites! Are you kidding me???? For Real????

On top of that, some people even get paid to post reviews. These methods of payment come in the form of free products, memberships to other sites, or even cold hard cash! Gee, sounds a lot like affiliate marketing doesn’t it?

This “problem” has been brought to the attention of the FTC. In order to protect the masses, that are evidently too stupid to figure out for themselves if the poster is making money from the post, they have decided to fine posters up to $11,000 per occurrence for non-disclosure.

Now I realize that there are unscrupulous bloggers and advertisers out there that blatantly prey on unsuspecting readers by hyping a product in order to get their click-through using the affiliate link they supply. On top of that, there is a whole sub-industry built upon “cloaking” affiliate links so the reader doesn’t even know that it is an affiliate link. Oh the horrors!!!!

But can we actually protect consumers, who won’t do the most basics of research when purchasing something, from themselves? Moreover, should we? Sorry, but this whole thing just rubs me the wrong way. To see my rant on the subject go here: My FTC Rant

However this post isn’t about ranting. It’s purpose is to inform and hopefully give you a couple ideas on how to modify (or not) your blog posts and sales pages to conform to the new FTC rules.

After reading the entire guideline document I have come up with what I feel are the two most important points that could affect us as Internet Marketers.

By the way, it doesn’t matter what niche you are in, these rules apply equally to people posting about dog training, weight loss, Internet Marketing, or penis enlargement.

Point #1: If you use results based testimonials to promote a product, it doesn’t matter if it’s your product or someone else’s (affiliate products), you have to include typical results as well.

Point #2: If you have any kind of relationship with someone who’s product you are endorsing or promoting, you need to disclose that relationship. For instance, someone sends you a pack of diet pills and you use them and lose weight. Then you post a blog about it telling everyone you lost weight using these pills. You are required to let everyone know that these pills were sent to you for free. Not only that, but to be safe you may want to mention that this was only your result, and that others may or may not get the same results. This is regardless of whether you are promoting the pills with affiliate links or even if you do not supply a link to the product’s site.

While these two points are spelled out pretty well, other parts of the rules are very vague. The FTC realizes this and to deal with it they specify that the rules will be enforced on a “case-by-case” basis. Which is just another way of saying, “we don’t even know what we don’t want to see in advertising, but we’ll know it when we see it”.

In other words, we won’t know how strictly any of the rules are enforced until the FTC begins to enforce them sometime after December 1, 2009.

How the FTC Rules Affect Testimonials

It used to be that you could display a disclaimer somewhere on the page saying something like “Results shown here are not typical”. This was usually hidden somewhere towards the bottom of the page along with all the other stuff people never read. Not anymore.

The rules state, “advertisements that feature a consumer and convey his or her experience with a product or service as typical when that is not the case will be required to clearly disclose the results that consumers can generally expect”.

Now using their own wording, you can choose to pick this apart and justify your posting of such testimonials by saying that the testimonial was not intended to be a typical result. You could also try to get by with the same type of disclosures we’ve been using all along (small type at the bottom of the page) changing the wording to include what you believe are “typical” results.

What are “typical” results? Well, to take making money types of offers, the typical results are that people will buy the product and do absolutely nothing with it and thus, won’t make a cent. So just put this statement into your existing disclaimer and hope for the best? I mean people don’t read them anyway so how much will it hurt?

I personally don’t think this would pass muster in that the past guidelines wording was specifically changed to include the wording “required to clearly disclose”, which tells me they want it in a font and place that won’t be overlooked. I would imagine that to adhere to the rules it would have to be placed directly over, under, or beside the testimonial in prominent font. What do you suppose that would do for sales? It’s certainly not the way I was taught to enhance the sales copy!

So in effect this means you should not use results based testimonials at all.

However, other testimonials seem to be fine. Ones that say they love the product or that they think you are the greatest thing since sliced bread. These types of testimonials don’t have near the impact that the results based ones do, but at least it doesn’t appear they will get you into trouble.

There is more. Concerning the other (disclosure) point and how it applies to testimonials, there are also some considerations. Say a friend of yours (JV partner perhaps) writes a testimonial for you. Do you have to disclose this relationship? In the strictest interpretation, I would say yes. Would you get into trouble if you didn’t? Maybe not, but then again, is it worth the chance?

While the rules concerning testimonials can be taken as a death knell for using results based promotional tools (including revenue screen-shots) there is a bright side. You no longer have to concentrate so hard on acquiring quality testimonials. As with all of Internet Marketing, and those resourceful people who choose it as a profession, we will overcome and eventually come up with other sales tools that will work equally as well.

How the FTC Rules Affect Affiliate Marketers

Even though there seems to be an uproar among affiliate marketers concerning these rules right now, the bright side is that affiliate marketers seem to have the least amount of changes to remain in compliance. The rules basically say that you have to disclose that you get paid when the reader purchases though your link.

Since this is one of those “gray areas” in the rules, you may be able to get by with changing your standard disclaimer and adding something like, “Links in reviews, articles, and posts on this site are affiliate links. This means I get paid a commission when you buy after clicking on one of these links”.

On the other hand, some people have interpreted the rules to mean every affiliate link must be disclosed. If you’re the conservative type, you may want an explicit disclosure on each link. Something like, “I will get a small commission if you purchase though this link”. Personally I think this is overkill and would rather move all my affiliate links out of the post’s text and into obvious display ads bordering the post.

Either way, we don’t yet know if one, or either, of these approaches will hold up until the FTC releases information solidifying their position on affiliate links. As I said, this is still somewhat of a “gray area”.

One thing worth mentioning, if you use the product developer’s sales material in your promotions, do take note of anything that may run up against the FTC new rules. If it’s posted on your site you could very well be responsible for the infractions.

Another “gray area” is that of email marketing. While it’s not explicitly spelled out in the rules, it very well may be one of those things that fall under the “case-by-case basis” umbrella. I would say if emails have any results based testimonials and/or affiliate links directly pointing to a sales page, deal with them the same way you would if it were posted to your site.

One more thing, do you offer eBook “freebies” filled with affiliate links? It’s up to you, but at the least I would add a disclaimer to the last page of each one letting people know that you get paid when they purchase through the links in the book. To be absolutely safe you may want to add a disclaimer to each link or maybe just a little (aff) after the link with a definition at the end would do the trick.

How the New FTC Rules Affect Product Developers

Product owners/developers are probably going to be affected the most.

Here’s what you should do at a minimum…

Change your affiliate marketing material, including email templates, solo ad templates, banner ads, and any other related material to get rid of any results based claims. Let your affiliates know of the changes and encourage them to use the new material.

Where typical/average results can not be accurately shown, you need to get rid of any and all results based testimonials on sales pages.

Go into your actual products and remove any user contributed results. This may be a bit much but it’s better to be safe than sorry. If you do include your own results in your sales pages or products be sure to show ALL your results from ALL the campaigns in which you used the product.

If you gave away any free “preview copies” of the product to people and they then wrote you a testimonial, disclose this information on your sales page.

Summed up…. when in doubt, DISCLOSE. At least you’ll have a leg to stand on if you do come under the gun of the FTC during a witch hunt.

Or you can just ignore all those Internet Marketing manuals that tell you how to cloak your links, make up results, bribe for testimonials, and become an ethical Internet Marketer. It isn’t that hard, I’ve been doing it for 6 years!

Some good news…. according to some blogs I’ve read quoting an FTC spokesperson (in other words, do your own research:) ), they have stated that there will be a “three strikes” policy. First, you get a “take down” notice. (Probably a nice email) Then upon non-compliance you’ll get a cease and desist order. (Probably a not so nice email and maybe a nasty piece of paper) Then if you’re really stubborn, they’ll hit you with a fine. And that will be “up to” $11,000.

So don’t quit your business, have a heart attack, or stress out. Don’t believe all the doomsday prophets that are saying we are all going to go under the guillotine. The FTC has big fish to fry and are, I’m sure, more concerned with flogs (fake blogs) and corporations sponsoring regular blogs. Services like Pay-Per-Post already has a disclosure requirement.

I’m not saying you should ignore the rules because you’re a small time operator, I’m just saying do the best you can to comply with your existing posts and from Dec. 1st into the future make sure your posts and ads comply with the new rules. The FTC has also stated that they will respond and investigate complaints. This could affect you no matter how large or small you are.

If you are a “big dog”, I would highly recommend getting in touch with your attorney and letting them guide you through this vague maze as the bigger marketers are more likely to come under the scrutiny of the FTC. For us littler folk and the hobbyist bloggers who can’t necessarily hire an attorney every time a new rule is put into place, let’s just do the best we can do, be honest in our dealings with customers and potential customers, and hope for the best!

There is no doubt Internet Marketing advertising will change as a result of these new rules. But it doesn’t have to be for the worse. Ethical Internet Marketers may actually have an easier time getting their products to the market once the unethical marketers with their advertising tricks have been dealt with.

For the my personal rant on the rules go here: My FTC Rant – you may get a kick out of it.

To our continued success!

Update: Nov 5th, 2009
When I wrote this I set a tickler to remind me to have another look at this subject after all the hoopla ran its course. Well its been a month since the announcement and here’s some encouraging news.

Ed Champion talked with Richard Cleland with the FTC and posted his conversation here:
/http://www.edrants.com/interview-with-the-ftcs-richard-cleland/

Caroline McCarthy with CNET also talked with Mr. Cleland and posted the results of that conversation here:
http://news.cnet.com/8301-13577_3-10368064-36.html

So what am I going to do now that I have this additional information? Well I guess I’ll just keep doing things the same exact way I was before until I hear from the FTC that I’m in non-compliance. But hey… I’m just a little guy trying to eek out a living so I doubt I’ll ever hear from them anyway!