When researching the latest marketing campaign strategies, don’t make the mistake of overlooking the strict legalities in place when it comes to advertising. While many common mistakes will simply result in a flag or ad takedown, other mistakes can cost you thousands in penalties. Violations can even cost you to lose your professional licenses when applicable.
Fortunately, education regarding these laws is readily available and not all may necessarily apply to your business. Below, we’ll tackle some of the most important regulations that you should be aware of and follow before creating your next digital marketing campaign.
The CAN-SPAM Act defines the FTC’s obligation regarding electronic messaging as follows: “defining the relevant criteria to facilitate the determination of the primary purpose of an electronic mail message.”
In other words, the FTC mandates that all businesses must clearly disclose the purpose of any emails to consumers and be explicit in their messaging in the headline, subject, and body of any content. The business must also provide the recipient with a legitimate method to opt out of any marketing and honor those requests appropriately.
The easiest way to ensure that your business never violates this act is to always be completely direct and truthful when it comes to any email marketing campaigns you employ. You need to express to the consumer somewhere in the email that this is an advertisement, provide only accurate details regarding the products or services advertised, and disclose any information that the consumer should know. This includes the domain address of the sender and the physical location of the business.
If you are ever unsure if your email messaging falls under this, consider the intent of the email. If it is being sent to inform the consumer of a promotion, a special deal, or any of your products or services that could result in a business transaction, the email is commercial. Therefore, you must fully comply with all regulations.
If the email is transactional, such as an order confirmation message or receipt, then your email is not necessarily classified as commercial. Nevertheless, all information found within must be accurate and explicitly educate the customer with accurate data.
You can follow the link above to the Federal Trade Commission’s website to review every protocol in detail to ensure that your messaging is not in violation of this act. Failure to comply with all regulations can result in a fine of $43,792.
Though CAN-SPAM is specific to the United States, most countries around the globe feature their own version of email marketing and consumer privacy laws. If you are outside of the country, be sure to research the mandates as set by your government.
COPPA is an act enforced by the Federal Trade Commission that regulates data collection for advertising from individuals under the age of thirteen. While this particular act applies only to the United States, countries worldwide feature similar privacy protection laws. However, the age will vary depending on your country.
The most common way that businesses deal with the COPPA act is by asking users to disclose their age whenever creating an account with them online. Users younger than the age of thirteen are generally not allowed to create an account. Others may not do this as they believe that their products or services are not marketed to younger persons.
However, taking the latter approach can potentially be risky as you are entirely subject to the ruling of the FTC. The Act targets businesses that actively promote material directed at individuals under the age of thirteen. This idea is ambiguous as to what can be defined as “directed.” It also can apply to businesses that generally target wide audiences as opposed to strictly targeting adults. You can review an extensive list of definitions regarding this act from the government here.
If you so much as suspect that your business must comply with COPPA, be sure to do the following:
COPPA also applies to businesses located in other countries that target United States users.
Truth in Advertising is a series of laws set by the Federal Trade Commission to protect consumers from false or harmful information in commercial advertising. Any business found guilty of perpetrating fraud is subject to asset seizing and freezing, serious financial penalties, and/or a federal lawsuit that can result in significant jail time. You can learn more specific details from the FTC here.
Examples of areas examined closely by Truth in Advertising include:
The FTC has also found it necessary to inform users of unlawful conduct in regards to global events such as the COVID-19 pandemic. Effectively, it is the business’s complete obligation to present strictly factual information to consumers regarding any advertisement, purchase, or interaction otherwise.
While these policies are broad and cover a lot of territories, the rule of complying is simple: do not lie to or mislead your customers under any circumstances. While it may not necessarily be your obligation to educate customers about certain matters, you can never promote or advertise a product or service without supporting factual and scientific evidence even if you, yourself, choose to believe otherwise.
The Truth in Healthcare Marketing Act of 2017 exists to protect consumers from any marketing or business practices that misrepresent a person’s legitimate medicinal expertise. In other words, an individual or business may not sell products or services under the guise of being a medical professional if they do not possess the appropriate training, qualifications, and licenses.
This marketing regulation should generally only apply to healthcare providers that solicit medical services. If you are a healthcare specialist or otherwise run a medical clinic that offers health and wellness services, you must disclose the necessary qualifications as determined by your state.
The Act also mandates that healthcare providers cannot promote or sell medical practices or products that are not fully supported by medical and scientific evidence. Failure to adhere to this policy could result in major penalties including a permanent suspension of medical licenses to practice.
While the healthcare provider themself will almost certainly be well-educated regarding federal and state policies for healthcare and patient privacy, your average marketer may not be up to speed. If you are providing marketing services for a healthcare professional, be sure to educate yourself regarding healthcare policies and privacy acts. Be sure to work with your client to ensure that you fully disclose qualifications and studies when necessary in any marketing materials.
Areas concerning environmental marketing terms fall under the Truth in Advertising rules mentioned above. The Green Guides are rules provided by the FTC to guide brands on how to properly define and utilize terms for their products or services that concern the environment. You can find details from the FTC here.
These guides cover a vast amount of terminology, so you will need to review these guides for yourself before making any types of claims. You will also want to double-check any terminology you wish to use to ensure that your version of the definition complies with the definitions determined by the FTC.
As with most advertising regulations, simply avoid making any unsubstantiated claims about the environmental-friendliness of your products or services. You should research terms or phrases such as “recyclable,” “renewable,” “non-toxic,” or “free-of” before including them in your marketing.
This section entails another subset of laws that regulate how businesses can utilize data that they collect from their customers. This applies to transactional information, data regarding finances and debts, personal browsing data and security, and COPPA, which was discussed previously above. You can learn more about the FTC’s approach to protecting consumer privacy here.
Where it can get tricky is that these laws will apply to your business if you do any type of business with people that live in a location. That means, for example, that a United States business that interacts with European customers must still comply with European law regarding consumer privacy. An example of this includes the General Data Protection Regulations which dictates how much data you can save from consumers, while also complying with requests to erase it.
It should go without saying, but you cannot use just any content you find on the internet to advertise or promote your business. All content including images, videos, or text is considered the private property of the owner unless otherwise dictated for public use. For this reason, you are likely already using or looking into royalty-free websites for your images, videos, or audio.
However, many businesses commonly overlook the fine print when downloading content from these sites for use. In many circumstances, the content may only be available for use for editorial or informational purposes. The issue arises due to confusion over phrases such as “creative commons” and “public domain.”
Public domain content applies to any content that no longer has copyright or was created by the U.S. government for public use. You may utilize public domain content for any purpose including commercial use.
Creative commons websites will generally feature a variety of content that can either be free to use, free to use but with restrictions, or copyrighted. The first is similar to the public domain. The second will depend on the restrictions put into effect by the owner and may prevent you from using it in marketing. The last point fully excludes you from using it unless you gain permission from the owner either through mutual benefit or by paying for a license to use it.
A common digital marketing strategy is to build relationships with influencers that can endorse and help sell your products or services. However, the FTC has mandated that businesses and influencers must disclose their relationship with one another for consumer knowledge. You can find full guidelines from the FTC on how to approach this here.
To quickly summarize the guidelines, any influencer you compensate for promoting your product must visibly disclose their status as a sponsored influencer. You can quickly satisfy this requirement by tagging a product or service post with “#Ad”. You can also say things like “Sponsored by” or “product provided by…” when creating your promotional content.
Influencers must then follow the same marketing regulations described by the FTC as you would yourself. In this sense, the influencer is seen as an extension of the business and you will be liable for any violations of any policies put into effect for consumer protection. This includes making unsubstantiated claims about the benefits of a product or providing false information about what the product or service actually provides. They also cannot be an influencer for a product they have not used themselves, but this can be a little more difficult to prove in some situations.
If you attempt to work with influencers for marketing purposes, it is your responsibility to educate them and ensure they comply with all of the rules. Failure to comply with these rules will result in penalties against your business. As a general rule, influencers will be keen to behave responsibly as their reputation depends upon positive relationships with brands online.
Last, but not least, all consumers must be afforded the right to post their honest reviews of your brand. This means that you cannot unlawfully prevent someone from leaving a review about your business on a directory, social website, or other platforms. While you can and should select positive reviews for your website or advertisements, you cannot penalize a consumer or impose a contract that prevents them from providing a review.
If a user does happen to leave a negative review that you find harmful or dishonest, you must follow the rules set out by the platform. You can choose to engage in honest interaction by replying to the post and addressing criticisms in a public manner. If the user is unwilling to delete their review, you can write to support and discuss the issue directly. Try to provide proof of any false claims and ask to have the review removed. If your claim is legitimate, the support team may be able to remove the negative review of your business.
You can learn more about the exact details concerning the Consumer Review Fairness act here.
While managing your marketing campaign strategy is no task, do not allow your brand to inadvertently break any laws regarding fair and ethical advertising. Even accidental violations can result in hefty financial penalties. Bigger violations could have even larger ramifications that alter your ability to do business forever.
This document is by no means a comprehensive list but should serve as a starting point to bring awareness to how heavily regulated the advertising industry is. Start by considering your business industry and the audience you directly market to and begin your research regarding the policies and regulations that apply to your brand.
In all cases, make every effort to demonstrate honest and ethical practices and a commitment to good faith concerning consumer interactions.