Transparency (or Lack Thereof) on Kohl's Facebook Fan Page

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I am a big fan of Kohl's. In 20 years they've risen from just 66 to more than 1,000 stores. Since the beginning of the decade, their stock has outperformed competitors', increasing 28% to Target's 6% and Wal-Mart's decrease of 28%. And, they've demonstrated a very admirable commitment to our environment, having recently been named by the EPA as the number one purchaser of green power among retailers. Plus, I like their stores and apparel!

So if I "expect great things" from Kohl's, it's only because they themselves have set the bar so high. This is why I was disappointed to learn about the lack of transparency exhibited by one of their marketing executives and an agency exec on Kohl's Facebook Fan page.

Based on his activities in Kohl's Facebook community, Ed Gawronski seems to be a big fan of Kohl's. Two weeks ago he noted, "Less then 4 hours to get a great deal at Kohls.com. I just hit the jackpot and saved 30% on some ASICS sneaks. Cost me almost nothing." And a couple days later he had another scoop for Kohl's Facebook Fans: "make sure to give your email to kohls.com. I think they give you $5 when you give it in. The deals get even better too. I've seen special online promotions every week."

You might think Ed is just a helpful guy and a big supporter of Kohl's, except a visitor to the Facebook page outed Gawronski as a Kohl's marketing executive. In a reply to one of Ed's posts, the anonymous visitor notes, "Interesting. Ed Gawronski is the VP of marketing for Kohl's. http://www.linkedin.com/pub/ed-gawronski/8/b1b/875 Masquerade much?"

Marketing executives certainly have a right to post about their organizations on Social Media sites, but the first rule of Social Media participation is to be completely and totally transparent. This means being honest and disclosing any relationship to the brand. Gawronski, with his chummy recommendation that others furnish their email to Kohl's and his boast about his shoe savings, attempts to pass himself off as a helpful consumer when in fact he is the Vice President of Digital Marketing at Kohls.

Gawronski isn't the only Kohl's stakeholder posting to the Kohl's Facebook wall without full disclosure. In the last two weeks, Marjorie Sklar Corbett has shared a couple of deals on women's apparel and praised Kohl's for an environmental honor, saying "It's so important, I'm glad Kohl's is getting the recognition for all the good they do!" While I can't be sure Marjorie works with Kohl's, she is a Group Director at McCann-Erickson, Kohl's ad agency; at best, the relationship between her employer and Kohl's ought to be revealed.

Social Media is no longer new, and we've seen enough embarrassing transparency mistakes to know better by now. In 2008, a Burger King exec was caught using one of his daughter's online accounts to spread rumors about critical labor advocates. In 2007, Whole Foods' CEO was embarrassed to be found praising his own company and bashing competitors via an anonymous alter ego on finance boards.

There are two primary reasons to be transparent and to completely reveal business or financial relationships when blogging, posting, or tweeting. First, getting caught being anything less than authentic is damaging to the brand. It is embarrassing, reflects poorly on the brand, undermines trust, calls into question the objectivity of others participating within the community, and discourages participation by the very consumers whose involvement, influence, and praise is desired and necessary in our increasingly social world.

But being transparent in Social Media is more than just a good idea--it's also the law. The FTC has always discouraged false or deceptive practices. It's advertising guides have long required that "When there is a connection between the endorser and the seller of the advertised product that might materially affect the weight or credibility of the endorsement, such connection must be fully disclosed."

The FTC is currently considering changes to its guides to demand even more transparency and disclosure in today's more social environment. In a recent MediaPost article, Michael Lasky, senior partner at Davis & Gilbert LLP, suggests, "Agencies and clients, especially those working in the social media space, must understand that the FTC's efforts to address deceptive practices can create liability and exposure."

Gawronski and Sklar Corbett's failure to disclose their relationship to Kohl's isn't likely to result in significant brand or legal harm, but they are failing to live up to consumer and FTC expectations in Social Media. They and other Kohl's employees are certainly welcome to participate in the Facebook discussion, but only with full disclosure about their vested interest in Kohl's success.

This is a lesson everyone must learn throughout the organization, from the top of the marketing career path to entry-level customer service reps and sales associates: Anything less than total transparency in your actions on Facebook, Twitter, or other Social Media communities can result in very serious, costly, and embarrassing consequences. The way employees and stakeholders should learn this is in explicitly stated and written rules of Social Media engagement and not by being outed in embarrassing and public fashion.