Friday, August 7, 2009

Paid Blog Posts: The Need for Total Disclosure But Only Partial Independence

Calling the world of blogs the "blogosphere" makes it sound futuristic, but the truth is that it's more like the Wild West. There are few best practices; no recognized industry organization has the power to set or enforce standards; rules are in flux (with the FTC currently reevaluating their guides); and modern-day brothel owners are eager to tell you how easy it is to buy blog love. ("Hey big boy, hot Playboy bunnies crave to tweet you!")

There is absolutely no doubt whatsoever that the best way to gain attention in Social Media is to earn it honestly with great brands that resonate with an audience, terrific consumer experiences, and customer service that delights. But for marketers who wish to pay for blogger attention, there are controllable factors that can help to protect the brand and diminish the risks.

I decided to revisit the topic of "sponsored conversations" after an interesting week of discussion. Four days ago, I posted a purposely provocative article to my blog entitled, My Paid Blog Post on the Forrester Blog. In it, I pointed out an apparent contradiction between Forrester's guidance on paid blog posts and their own site's rules against paid blog posts. Forrester's Josh Bernoff responded with a fair clarification of their stance in a blog post entitled "To Augie Ray: Thanks for the offer, but we don't take sponsorships." I very much appreciate the insightful, serious, and interesting dialog that has occurred within the comments of my blog and elsewhere, particularly from Josh and his Forrester peers, Jeremiah Owyang and Sean Corcoran.

The experience has caused me to reconsider my opinions of "sponsored conversations." I still believe very strongly that paid blog posts carry enormous risks for brands--legal, ethical, and, most of all, consumer perception--but there also is a place for brands to compensate bloggers for attention in the blogosphere. The problem is that, in lieu of established standards and governing bodies, there is no alternative for marketers except to proceed with care, knowledge, and a great deal of preparation to build meaningful relationships with relevant bloggers. "Sponsored conversations" may be paid media, but smart marketers will treat them more like strategic partnerships than advertising.

To properly explore the benefits and dangers to brands, we first have to recognize that the "sponsorship" in "sponsored conversations" can take a wide variety of forms. On his blog, Jeremiah Owyang identifies eight types of blog compensation. While paying cash to bloggers is easy, it also raises the greatest ethical fears and risks for the brands. But what about free product, junkets, and access? (I've been offered and turned down monetary compensation for coverage on Experience: The Blog, but I haven't hesitated to use those opportunities to gain access to information and insight I can share on my blog; in essence, I've accepted compensation in form of interesting content, opinion, and experience for my readers.)

With no established standards, what can marketers do to ensure their paid blog posts authentically build brands in Social Media? What factors separate blogola (the Social Media version of radio's payola scandal) from the sorts of compensation arrangements that meet with the approval of consumers and the FTC?

I believe there are several factors that marketers must consider when participating in sponsored conversations. We'll explore the first two--which largely pertain to issues of law and ethics--in this blog post. In my following post, I'll suggest several other factors that marketers must consider to protect their brands from risks and harm when paying for coverage on blogs.

The first two important factors for brands are Disclosure and Independence. It's important to note that these are not simple elements that merely are present or not. Both Disclosure and Independence have nuances and complexities that marketers must understand to avoid costly and embarrassing mistakes when compensating bloggers:

Paid Blog Post Disclosure

Not all disclosure is equal. To be effective, disclosure must be clear and conspicuous, detailed, and complete.

Clear and conspicuous: If a blogger is contractually obligated to furnish coverage in exchange for compensation of any kind, this fact must be evident to even the casual reader. Consumers must know when they are being exposed to paid advertising in manner that is instantaneously obvious. A small disclaimer at the end of a long blog post isn't conspicuous--it doesn't inform consumers until after they've dedicated time and attention.

Consumers seeing an advertorial ad in a newspaper know it's an ad with little interpretation and no doubt. These article-like ads are identified as paid media in several visual ways including special fonts, backgrounds, or borders, but mostly by plastering the ad with the word "advertising." For example, here is a blog post about just such an ad that appeared in L.A. Times, and it not only demonstrates how print advertorial ads are set apart from content, but also the risks that come from ads that appear to be editorial, even in established media like newspapers.

What would be the equivalent for blogs? How might paid blog posts be instantaneously identified as such by even a casual blog reader? Perhaps the term "Advertisement" should appear in the blog headline or in a repeated background image. Or, the very first paragraph of a blog post could declare the article is a paid advertisement in letters that are bolded and highlighted. No disclosure standards exist (yet), so it is left to marketers to establish the disclosure rules they feel are essential to protect the brand, ensure consumer acceptance, and adhere to legal and ethical expectations.

Detailed: The second aspect of disclosure is that bloggers must be thorough in revealing the form and amount of compensation. Consumers must know if cash was paid, free product was given, or the blogger received some other form of remuneration. I'd also suggest that the value of this compensation be disclosed to ensure the sort of transparency expected in Social Media and to protect brands from lost trust should consumers subsequently learn of unexpectedly lucrative blogger agreements.

Some may argue that disclosing the value of compensation is more than is necessary since magazines and television networks don't reveal the cost of their ads to consumers. This is true, but the difference with paid blog posts--and it is an important one to both brands and bloggers--is that what is being purchased is not merely advertising but editorial attention. Brands do not need special disclosures when paying for traditional and customary online banner or AdSense advertising on blogs, but when a blogger's words and sentiment may be influenced by compensation, consumers need to know more.

This is one area the FTC is specifically exploring as it considers more thorough rules for sponsored conversations. In their proposed new guides, an example is furnished of a gaming blogger being provided a new game system to review; the FTC states, "the blogger should clearly and conspicuously disclose that he received the gaming system free of charge." While these guides are not yet approved and in place, it is clear that bloggers compensated for posts are going to be expected to disclose far more than is common today.

Complete: To protect their brands, marketers must ensure bloggers reveal any special arrangements between brands and bloggers, not merely when a pay-for-post agreement exists. In the same way newspapers are expected to disclose their interests and potential conflicts when covering a story, bloggers must do the same to protect the credibility of both the blog and the brand.

I call this the "wink wink nudge nudge" rule. It is designed to protect against questionable and risky situations such as when a brand pays a blogger to be "a consultant" without (wink wink nudge nudge) defining any specific quid pro quo on the blog. Or when marketers pay a blogger to furnish content for the brand's site without any agreement (wink wink nudge nudge) for positive coverage on the blogger's own blog. Any time marketers feel a "wink wink nudge nudge" coming on when negotiating deals with bloggers, that's evidence the circumstances may not meet ethical standards or require greater disclosure.

Paid Blog Post Independence

In some ways, disclosure and independence are opposing forces in the battle for consumer trust. For paid blog posts to have authenticity for brands, consumers must feel the blogger is working independent of brand interference, but the moment we disclose the presence of an agreement, consumer trust begins to erode. Nothing marketers or bloggers do will prevent some degree of suspicion that the brand's consideration to the blogger didn't just buy coverage but in fact positive sentiment.

This sounds like a problem of perception, but this is an issue as much of reality as perception. Once we compensate bloggers, how do we know that we haven't swayed their opinions? Let's be honest, what do we marketers really want when we compensate bloggers--mere coverage or positive sentiment such as praise, endorsements, and recommendations? If we compensate a blogger and he or she bashes our brand, will this impact our willingness to pay this person again? Consumers are smart; they know the answers to these questions and don't need any excuses to be suspicious of paid blog arrangements. Any missteps or mistakes will be costly and consumer reaction will be unforgiving, so brands and bloggers must strive to make independence a reality even though it's a battle for consumer perception we cannot completely win.

One irony of paid blog posts is that while consumers, bloggers and Social Media practitioners may demand the complete and total independence of bloggers, the FTC has different ideas. For brands, there can be such a thing as too much independence, because the onus is still on the brand to make sure the compensated blogger's content is accurate. This is paid media, and like all paid media, the FTC expects advertisers to ensure accuracy.

In the proposed rule changes, an example is cited of a skin care products advertiser purchasing editorial coverage via a blog advertising service. In the example, the blogger makes a product claim that is not true, and the FTC notes, "the advertiser is subject to liability for false or unsubstantiated statements made through the blogger’s endorsement." The FTC goes on to suggest:

"In order to limit its potential liability, the advertiser should ensure that the advertising service provides guidance and training to its bloggers concerning the need to ensure that statements they make are truthful and substantiated. The advertiser should also monitor bloggers who are being paid to promote its products and take steps necessary to halt the continued publication of deceptive representations when they are discovered."

This is dangerous ground for marketers. Asking for prior review of bloggers' posts is considered a very troubling practice that undermines the necessary independence of the blogger. Asking for such a review--even in the absence of intent to evaluate and control sentiment--can influence the blogger's words and stated opinions. Conversely, leaving bloggers to their own devices can expose brands to risk. Best practices will develop, but for now it's clear brands must:

  • Set expectations that bloggers will be factual and will validate or ask for confirmation of all statements of fact contained within paid blog posts;
  • Furnish vital brand facts to bloggers so they can write their posts with both independence and knowledge;
  • Monitor the bloggers who are compensated to ensure their accuracy.

Another practice that I believe will develop is that the level of independence afforded to bloggers will be part of the disclosures associated with paid posts. Did the agreement require the mention of a product's new feature? Was there an expectation of positive sentiment? Was the brand given the opportunity to review the blog post before it was published? Or did the brand furnish compensation with no expectation as to content, sentiment, prior review, or anything else other than accuracy?

If brands want to pay for play in Social Media where transparency is king, queen, and prime minister, then the independence afforded bloggers must be as great as legally advisable and disclosed thoroughly.
    Disclosure and Independence are the primary factors that ensure paid blogging is executed in a legal and ethical manner, but there are other attributes that can help or significantly harm a brand's reputation when compensating bloggers. We'll explore these other important factors--which include form of compensation, financial value, and the blog's existing and implicit credibility--in my next blog post on Experience: The Blog.

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