Policies & Issues

FTC to Crack Down on Sponsored Internet Posts

Policies & IssuesAug 11, 2016

FTC to Crack Down on Sponsored Internet Posts

The Federal Trade Commission will be tougher on paid endorsements and how they are disclosed, according to one recent report. 


New York--Paid content is hardly something new, yet with the increasing influence of the digital world, a different set of issues has come to light.

As celebrities and “influencers” take to social media channels and Internet platforms in larger and larger numbers to best reach their audiences and fans, the lines between getting paid to post content and giving proper disclosure are blurring.

But the Federal Trade Commission has noticed and now is trying to crack down on sponsored posts, according to a Bloomberg report.

The latest includes an FTC complaint filed against Warner Bros. Home Entertainment, which charges that the entertainment company deceived consumers during a marketing campaign for its video game Middle Earth: Shadow of Mordor by failing to adequately disclose that it had paid online influencers to post positive videos online and didn’t tell influencers to include sponsorship disclosures clearly and conspicuously on the videos.

In addition to prohibiting the company from misrepresenting the paid video reviews as coming from impartial players, the FTC also specified the minimum steps that Warner Bros. must take to ensure it’s complying with the final order, including educating influencers on sponsorship disclosures, monitoring videos for compliance, and terminating or withholding payment when they see non-compliance.

The FTC did not respond to a request for comment from National Jeweler by press time but the Bloomberg report indicates that social media in particular seems to be a bit of a gray area when it comes to paid content and disclosure.

The FTC says it’s OK if #ad is at the beginning of a post, but not #sp and #spon, hashtags indicating a “sponsored” post.

“If consumers don’t read the words, then there is no effective disclosure,” Michael Ostheimer, a deputy in the FTC’s ad practices division, is quoted as having told Bloomberg. “If you have seven other hashtags at the end of a tweet and it’s mixed up with all these other things, it’s easy for consumers to skip over that. The real test is, did consumers read it and comprehend it?”

Earlier this year, the commission also brought a complaint against Lord & Taylor, charging that it “deceived consumers by paying for native advertisements,” including a seemingly objective article in Nylon magazine and on its Instagram that weren’t disclosed as paid content.

Lord & Taylor also allegedly paid fashion influencers to post a dress on Instagram, without disclosing that it had paid
them or given them the dress for free. Any compensation, including free products, must be disclosed, the FTC says.

Cecilia Gardner of the Jewelers Vigilance Committee said that though they don’t see too many paid sponsorships from jewelers that are not clearly labeled as ads online, any that did still would be subject to the same scrutiny as other advertisers.

“Jewelers should be aware of the rules governing online advertisements--it should be clear that ads are paid and not unsponsored testimonials,” she said.

In a 2014 column on National Jeweler addressing similar issues, the JVC’s Sara Yood said, “Consumers are savvy, so it is important to be transparent. This advertising should not be about tricking the consumer, but clearly providing the source of the content of the advertising.”

The JVC website also specifies that “a misrepresentation is material if it is likely to affect consumer’s choices or conduct regarding an advertised product or the advertising for the product.”

When it comes to social media, the FTC says if a post is “part of a sponsored campaign or you’re being compensated … then a disclosure is appropriate.”

While there is no special wording for how to do this, “the point is to give readers the essential information.” A simple disclosure, such as “Company X gave me this product to try …” would do. Or starting a Tweet with “Ad:” or “#ad” also would be effective.

Guidance on digital endorsements and testimonials as well as additional questions regarding social media and endorsements can be found on the FTC’s website.
Brecken Branstratoris the senior editor, gemstones at National Jeweler, covering sourcing, pricing and other developments in the colored stone sector.

The Latest

Image #1_Resized.png
Supplier BulletinAug 28, 2025
Clientbook Is Helping Jewelers Turn Clienteling Challenges into Wins with Hands-On Training and Coaching

Sponsored by Clientbook

GIA’s new report for lab-grown diamonds
GradingAug 28, 2025
GIA’s New ‘Quality Assessment’ for Lab-Grown Diamonds Is Coming

It will classify lab-grown stones into one of two categories, “premium” or “standard,” in lieu of giving specific color and clarity grades.

Botswana President Duma Boko
SourcingAug 28, 2025
Botswana Declares Public Health Emergency Amid Diamond Sales Slump

President Duma Boko addressed the country’s medical supply chain crisis in a recent televised address.

japac-btyb.png
Brought to you by
Rallying Call for the Jewelry Industry on Tariffs and Other Key Issues

Jewelers of America is leading the charge to protect the industry amidst rising economic threats.

Afton Robertson-Kanne Borsheims
MajorsAug 28, 2025
Borsheims Names New Jewelry Buyer

Former Free People buyer Afton Robertson-Kanne recently joined the retailer.

Weekly QuizAug 22, 2025
This Week’s Quiz
Test your jewelry news knowledge by answering these questions.
Take the Quiz
Sissy’s Log Cabin Back to School and Bling
IndependentsAug 28, 2025
Sissy’s Log Cabin Donates School Supplies to Memphis Students

The jeweler teamed up with two local organizations for its inaugural “Back to School and Bling” event.

Taylor Swift Engaged
EditorsAug 27, 2025
Taylor Swift’s Engagement Ring Is a Fairy Tale for Vintage Diamond Cuts

The singer’s new bling, reportedly a natural old mine-cut diamond, is no paper ring.

rio-article photo-diamond.jpg
Brought to you by
Taking the Moment Head On: How Rio Grande Champions the Present & Future of Fine Jewelry

As a leading global jewelry supplier, Rio Grande is rapidly expanding and developing new solutions to meet the needs of jewelers worldwide.

11,685-carat Imboo emerald
SourcingAug 27, 2025
11,685-Carat Emerald Recovered From Zambia’s Kagem Mine

Dubbed the “Imboo,” or “buffalo,” emerald, the rough gemstone is part of Gemfields’ latest emerald auction, which is taking place now.

Shopping cart
SurveysAug 27, 2025
Consumer Confidence Slips in August Amid Job, Income Worries

Plans for dining out, booking vacations, and buying big-ticket items were down.

Mine + Found Play Collection Prize Bubble Locket, Whistle Pendent, Fortune Dice
CollectionsAug 27, 2025
Mined + Found’s New Collection Gets Playful

The “Play” collection centers on nostalgic toys that have kinetic elements to carry playfulness and wonder into adulthood.

CCWW lifesaver necklace
CollectionsAug 26, 2025
Does Your Jewelry Stack Need a Snack?

Designer Christina Puchi, the creative force behind CCWW Designs, has created charms and pendants based on iconic candies and crackers.

Nick Jonas x Fossil Campaign
WatchesAug 26, 2025
Nick Jonas Gets Nostalgic in New Fossil Campaign

The Jonas Brothers star showed off new timepieces against the backdrop of his favorite spots in his home state of New Jersey.

Wally Hinkamp and Donna Hinkamp Warren
IndependentsAug 26, 2025
Hinkamp Jewelers Celebrates 70 Years

The family-owned jeweler in Fayetteville, North Carolina, is in the hands of the second generation.

Emmanuel Raheb
ColumnistsAug 26, 2025
Back to School, Back to Style: Why August is Prime Time for Self-Gifting

In his latest column, Emmanuel Raheb shares tips for encouraging customers to treat themselves to new jewelry.

London Jewelers Rolex East Hampton Boutique Exterior
WatchesAug 25, 2025
London Jewelers Brings Rolex to Historic Hamptons Home

The new stand-alone Rolex boutique is housed in the former Odd Fellows Hall, a landmark built in 1897.

Madison Keys
CollectionsAug 25, 2025
Tennis Star Madison Keys Has the Perfect Necklace for the US Open

The Brilliant Earth ambassador co-designed a diamond medallion featuring meaningful symbols.

Marie Lichtenberg emerald and diamond locket on the 18-karat gold “Rosa” chain
TrendsAug 25, 2025
Amanda’s Style File: That’s a Wrap

Wrap jewelry is more than just a trend; it’s the perfect motif for the coming season of layering, scarves, and pumpkin spice.

WatchTime New York
WatchesAug 25, 2025
WatchTime NY Show Returns for 10th Anniversary Edition

The three-day watch collector show, coming this October, will feature 44 exhibiting brands, as well as a new dinner experience.

Sriram “Ram” Natarajan
GradingAug 22, 2025
Former Head of GIA India Promoted to Oversee Global Operations

Sriram “Ram” Natarajan is now GIA’s senior vice president of laboratory operations and is based out of the lab’s headquarters in Carlsbad.

Retrouvaí Diamond Vein Bond Collar
CollectionsAug 22, 2025
Piece of the Week: Retrouvaí’s ‘Diamond Vein Bond’ Collar

The one-of-a-kind collar represents the beauty of imperfection and the strength to rebuild.

Kendra Scott
MajorsAug 22, 2025
Kendra Scott Returns as CEO of Her Jewelry Empire

Three C-suite executives, including former CEO Tom Nolan, have resigned as part of what the company describes as a “transition.”

Claire’s storefront
MajorsAug 21, 2025
Claire’s Finds Buyer, Could Save up to 950 Stores

The retailer, which recently filed Chapter 11, inked a deal to sell its North American business and intellectual property.

Target CEO Brian Cornell and COO Michael Fiddelke
MajorsAug 21, 2025
Target Names New CEO as Sales Continue to Lag

Target CEO Brian Cornell will step down in February and be replaced by the company’s chief operating officer, Michael Fiddelke.

Tiffany & Co. Pop Up at U.S. Open
MajorsAug 21, 2025
Tiffany & Co. Pops Up at 2025 US Open

The pop-up will display this year's Tiffany & Co. Singles Championship trophies along with a diamond-encrusted tennis racket and ball.

Bellman’s Jewelers The Truthful Jeweler Alex Bellman
IndependentsAug 20, 2025
Bellman’s Jewelers Opens Second Store After COO's TikTok Takes Off

The New Hampshire-based store has expanded to Boston, propelled by the success of Alex Bellman’s TikTok page, “The Truthful Jeweler.”

Stock image of police cars with lights flashing
CrimeAug 20, 2025
Another CA Jewelry Store Rammed With Car, Robbed

The latest incident happened Monday at a store in Oakland, California, continuing a pattern JSA first warned about last month.

×

This site uses cookies to give you the best online experience. By continuing to use & browse this site, we assume you agree to our Privacy Policy