Advertising Industry Self-Regulation Overview

Transcription

1 Advertising Industry Self-Regulation Overview C. Lee Peeler President, Advertising Self Regulation Council EVP, Council of Better Business Bureaus Peter C. Marinello Director, Electronic Retailing Self-Regulation Program VP, Council of Better Business Bureaus Presented to the Electronic Retailing Association Government Affairs Fly-in May 8, 2012

2 Advertising Self-Regulation Programs NAD 1971: Developed in response to consumers concerns about truth and accuracy in advertising. CARU 1974: Chartered to assure that advertisers would take special care in addressing advertising messages to a vulnerable audience. ERSP 2004: Developed at the request of ERA to promote truthful and substantiated direct-response marketing claims and monitor industry outliers. Initiative 2006: Formed to address broad public concern over advertising and childhood obesity. NAD/CRN 2007: Created in cooperation with the Council for Responsible Nutrition to expand NAD s review of dietary-supplement advertising and rein in outrageous claims. Online Interest-Based Advertising Accountability Program 2011: Developed in cooperation with the Digital Advertising Alliance to ensure industry compliance with the Self-Regulatory Principles for Online Behavioral Advertising (Principles).

3 A Better Mousetrap Independent: Administered by a respected third party Council of Better Business Bureaus. Transparent: The outcome of every case is publicly reported. Accountable: Companies that refuse to comply are publicly identified and referred to the appropriate government agency.

4 BBB System 116 local Bureaus Business Ratings Complaint Resolution

5 BBB System

6 ERSP Goals & Procedures Improve/restore consumer confidence in electronic retailing Provide a quick and efficient mechanism for reviewing direct response advertising campaigns Demonstrate to the regulatory agencies, the direct response industry s commitment to strong self-regulation and compliance with legal requirements

7 Issues & Claims Reviewed by ERSP Testimonials/Endorsements Before-and-After Depictions Weight Loss Health and Safety Establishment Claims Disclosures Social Media Puffery Demonstrations The World s Fastest Weight- Loss Solution The #1 Doctor Recommended Joint Supplement Within 7 days, my acne completely disappeared. Lose 287% the weight compared to placebo The Clinically Proven Weight Loss Supplement!

8 ERSP Process Advertising comes to the attention of ERSP through its monitoring of the marketplace and consumer and competitive challenges. Process Opening letter Marketer s reply ERSP reply Marketer s response Final decision Press release

9 ERSP by the Numbers 7 years (founded in 2004) 280 cases closed 10 pending Annual Live Shopping Review Average days to close: 65 business days Challenges: 79 Government Referrals: 15 Compliance Rate: 95%

10 FTC Support for ERSP An investigation sufficient to support an FTC advertising case requires substantial government and company resources and can take many months to complete. By contrast, the average time for an ERSP review is 60 days. This provides real benefits for consumers The fact that I can point to successful programs like the ERA s adds greatly to the credibility of our message that current concerns about advertising and marketing should be addressed on a self-regulatory basis. Deborah Platt Majoras, Chairman, FTC When other organizations ask me about how they could make self-regulation work for their industry, I refer them to the Electronic Retailing Self-Regulation Program to use as a model. Rich Cleland, Assistant Director, FTC s Division of Advertising Practices The carrot of ERSP self-regulation should be obvious quick evaluation of potentially problematic ad claims, a level playing field among competitors and increased consumer confidence in the industry s ability to police itself. What s the stick? It s an ERSP referral to the FTC Lesley Fair, FTC Bureau of Consumer Protection

11 ERSP Supporters Knowing that ERA has these things in place gives the legitimate players in the business peace of mind. And having programs like ERSP not only keeps our industry clean, but also keeps consumer confidence up. - Jeff Meltzer, CEO, Meltzer Media Productions If ERA supports (ERSP) by having members believe in it, and understand that it makes us stronger and actually increases response on TV, then ERA has done its job well. - Jon Congdon, Beachbody President and Co-founder

12 This case came to the attention of the FTC as a referral from the Electronic Retailing Self-Regulation Program. Non-Compliance? Non-Participation? FTC Bans Colon-Cleanse Marketer from Infomercials

13 ERSP Case Reports ERSP decisions are available that the ASRC Archives: Press releases can be found at

14 Online behavioral advertising ( OBA ) is the collection of data about a consumer s online visits to different Web sites (browsing history) to predict the consumer s interests and to deliver advertising targeted to the consumer s interests. It is also called targeted advertising or interest-based advertising OBA does not include: What is Online Behavioral Advertising? The activities of First Parties on their own Web sites or the Web sites of their affiliates (example: Amazon ad saying based on your purchase history or Amazon, you may also like this. ) Contextual advertising (i.e., advertising based on the content of the Web page being visited, a consumer s current visit to a Web page, or a search query)

15 Self-Regulatory Principles for Online Behavioral Advertising Released July 2009 Education Transparency Consumer Control Data Security Material Changes to Existing OBA Policies and Practices Sensitive Data Accountability

16 The Advertising Option Icon and accompanying language should be displayed in or near online advertisements or on Web pages where data is collected and used for behavioral advertising. It gives consumers a quick way to recognize a targeted ad and make a choice. The Icon indicates adherence to the Principles. Ad Choices Interest-Based Ads Why Did I Get This Ad? Transparency Principle Advertising Option Icon By clicking on the Icon, consumers will be able to link to: a clear disclosure statement regarding the company s OBA data collection and use practices an easy-to-use opt-out mechanism

17 New Principles Go Into Effect in 2013 Multi-Site Data (MSD) Limitations on the collection of MSD Restriction on the use of MSD for eligibility purposes Special provisions for sensitive data Accountability requirement

18 And Now a Word from the FTC!

19 Lois Greisman Associate Director for Marketing Practices Spam Telemarketing Internet Fraud Business Opportunities And Much More!