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Monday, October 7, 2013

Advertising and Promotions on Social Media

The cover article in this month's Practical Law The Journal, Transactions & Business (October 2013) is definitely worth a read for corporations and other businesses using social media to advertise or promote their business and activities.  The author of the article titled "Advertising and Promotions in Social Media" is Gonzalo E. Mon, a lawyer practicing in the area of advertising law. 
The article acknowledges the benefits of social media marketing, including reaching a larger audience more quickly and at a lower cost than traditional advertising.  The bulk of the article, however, cautions companies advertising their goods and services or running a marketing promotion about the risks and potential liability associated with advertising and marketing in social media.  These risks include legal issues relating to advertising claims and disclosures, endorsements and testimonials, and contests and sweepstakes, among others. 
The article states two basic principles of advertising law:
  1. Advertisers must have a reasonable basis to substantiate the claims they make in their ads.
  2. If disclosures are required to prevent a misleading ad, they must appear in a clear and conspicuous manner.
The article includes a number of tips for social media promotions, including the following:
"Planning Promotions in Social Media
When planning a promotion in social media, companies should:
  • Ensure compliance with contest or sweepstake laws, as applicable
  • Ensure compliance with any rules established by the platform on which the promotion will run
  • Think through the potential legal and other issues and take steps to guard against them.
  • Consider the Risks and benefits of turning over some control to customers
  • Enter into contracts with any third parties that may be assisting the company with any aspects of the promotion" (Gonzalo E. Mon, "Advertising and Promotions in Social Media," p. 50)
The most valuable tip provided in this article is that companies must remember that laws governing ads and promotions apply equally to social media advertising as the laws apply to other platforms.

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