Business opportunity or “bizopp” offers have been a mainstay of affiliate marketing for years. The good ones offer consumers the ability to make extra money while working from home; the bad ones prey on the financial desperation of unemployed consumers.
The FTC (Federal Trade Commission) has been playing Whac-A-Mole with bad bizopp advertisers for almost as long as the category has existed. As of March 1, 2012, the FTC implemented a revised rule (the “Bizopp Rule”) substantially altering the bizopp landscape and imposing tough new requirements for marketers.
The revised Bizopp Rule is dense and technical but, from an advertising perspective, the upshot of the rule is pretty simple. And it goes right to the heart of what makes bizopp offers convert. If a bizopp marketer makes any claim (express or implied) about how much consumers can earn from an opportunity, the marketer must provide two key disclosures.
First, the marketer must disclose the beginning and ending date of the period when the claimed earnings were achieved. Second, the marketer must disclose the number and percentage of individuals who achieved the claimed earnings within the stated time period.
Additionally, and perhaps most importantly, these disclosures must be made “in immediate conjunction with the claim.” This is not an esoteric concept. No links, no asterisks, no fine print below the fold. The disclosures need to be right there with the claim.
For example, if a marketer claims, “You can make $1,541 every day!” the next line of copy should be something like, “Earnings calculated from January 2012 to March 2012 for 100 participants, representing 10% of all participants.”
I know, I know . . . not the most riveting call to action.
But here’s the really fun part. Although the FTC doesn’t come out and say it, the first item on its agenda after promulgating a shiny new rule is to make an example out of someone who violates the rule. So, if marketers think there’s a “grace period” or that they can plead ignorance, they should think again.
The black helicopters are circling now, and once the FTC finds a target – it’s game over. Just ask the company that recently “settled” with the FTC for a mere $359,000,000. Granted, they were selling bizopp products using a negative-option subscription model with a high monthly price point, but their story is a cautionary tale. Affiliates running bizopp offers need to carefully review all ad copy to ensure they’re in compliance with the revised Bizopp Rule.
Please note that the revised Bizopp Rule has several other important requirements for marketers. The focus here is on the requirements that apply to advertising copy.
For a good bizopp compliance reference, the FTC has provided a simplified summary of the rule at feedfront.com/bizopp.
Slade Cutter owns and operates Cutter Law, P.C. – for more information visit www.sladecutterlaw.com.
Download the entire FeedFront issue 18 here – http://issuu.com/affiliatesummit/docs/feedfront-18
FeedFront issue 18 articles can be found here as well: http://feedfront.com/archives/article00date/2012/4