Internet Marketers Biggest Loser in FTC Ruling
You seen them on Internet websites, on late night tv, in the back and sometime full page ads in magazines. You’ve wished it true but somehow you either used your better judgment or perhaps you’ve bitten the bullet once or twice and got burned and swore you’d never be taken again.
What am I talking about?
Making millions in your pajamas at the kitchen table. What else? I wasn’t talking about the miracle pill to ‘extend’ that certain part. What were you thinking, silly you.
This is a serious ruling… really… and in case you haven’t been bitten I’ll explain why now it will be much harder to get bitten. With the economy the way it is, I’m glad this consumer protection has been extended to catch up to the realities of the 21st century.
For years, I’ve had a passing fancy… mind you a closet wanna-be maybe… or perhaps a student of sales and marketing that analyses and digests all forms of marketing to see if I can pick up a thing or two that might help me in my business or help my clients in theirs. Internet marketing just happens to be something I have a little case knowledge and success at. But certainly not in the way that technology has allowed the con man at the carnival to flourish.
I’ll paint the broad strokes of the methodology of how these marketers claim to make 6 figures a month, like clockwork by only working 4 hours a week.
Here’s what happens.
XYZ Internet marketer produces a product… sometimes with video, sometimes with audio… sometimes in the form of an e-book, or any combination thereof. For illustration sake, let’s say it’s the latest greatest way to ‘slap google’ and get your website to the top of the search engines.
It could be anything imaginable from teaching your parrot to talk, to getting a herd of customers to buy into your ‘secret membership’ where only the brightest and most talented marketers congregate to cuss and discuss and reveal to each other their most treasured secrets of subject xyz.
So what happens next?
After XYZ Internet marketer creates his product he prices it from $49 to several thousand dollars. XYZ marketer announces to several websites and his identified gang of ‘highly successful internet marketers’ that he is about to ‘launch’ this product and that if any other marketer sells a copy of his product, he is entitled to a commission. Sometimes this commission can be as much as 80% of the selling price and usually never anything below a 50% split.
Now the thousands of ‘affiliate marketers’ start sending e-mails to their lists (other people that either are making money from the internet or those that want to), and start talking up how XYZ Internet marketer is going to be selling this new product in the next few weeks.
What happens in these launches is really laughable if it weren’t reality.
These internet marketers start sending emails saying …if you buy from me (the affiliate), XYZ Internet marketers product, I’ll give you a bonus of thousands of dollars of my product (which I sell everyday at ridiculously high prices and little substance to unknowing nit-wits who want to make millions in their pajamas).
The feeding frenzy begins. Can you imagine the tall tales that are being told to sell this product? Mind you most internet marketers haven’t even seen the package, so how can they talk it up?
You see every internet marketer tells you the money is in the list. So they put up a website claiming to be an expert at something. They write a 10 page book report, call it a ‘Special Report’, give it some outrageous value like $77 and give it away free. Of course if you’re interested in receiving this $77 valuable special report for free , you’ll have to leave them your name and email address and they’ll send it to via e-mail. All automated totally without intervention on their part. How cool can that be right?
Thus the ‘list’.
Over time, these internet marketers accumulate thousands of names on their ‘list’. When it comes time to launch or promote a new product, they endorse that product and start sending out e-mails to their list, priming these other wanna be marketers to buy this new product.
You can see how the lure of easy money can tempt even the most saintly of us to possibly perhaps bend or stretch the truth on xyx product. A lot of times when they really don’t even have the product in hand to truly give an honest endorsement or recommendation. (This being one of the catalysts for this new ruling).
I have studied a lot of these internet marketers over the years and I’ve noticed testimonials from the same people pop up on a good percentage of the sales pages of various products. It’s so pathetic in fact, a couple of very famous internet marketers have a testimonial on the sales pages of products that even compete with similar products of their own. After all, the more times they can get their face out there (and link back to their website), the more credibility and possible residual sales they earn for themselves.
There are other reasons that this new ruling has come into effect. There are flogs (fake blogs), where these internet marketers (or even legitimate offline real world companies) put up a site about xyx product and then place fake testimonials on them. Or some companies have even gone so far as to pay an individual(s) to post a testimonial on their site and every where else on the Internet that someone might be so it creates credibility for a product.
The list goes on. The bottom line is a lot of the fake and false testimonials and endorsements are now going to be looked at a lot closer. All you have to do is simply click on the File a Complaint button at the FTC, and over time these con men are going to leave the carnival.
Don’t get me wrong. I’m not saying that all internet marketers are liars and crooks. But most are, or at least tall story tellers. Some internet marketers really provide solid actionable, legitimate how to information.
I can help you with a simple bit of advice to help you sniff out the players from the Monday morning quarterbacks. It’s simply this. The bigger the claim, in most cases, the bigger the fraud.
If your new to internet marketing and want to get some real valuable training… and for free… you couldn’t go wrong by trying the 30 Day Challenge. Each day, for thirty days, Ed Dale, via videos will explain how to get started, what actionable items you need to do for that day. Over the course of thirty days you’ll be grounded in the fundamentals. The information that Ed passes along could also be purchased for thousands of dollars from other sites, but there is no sense in that.
Goto www.thirtdaychallenge.com and get started.
Specifically here is the cut and dry of the ruling:
Under the revised Guides, advertisements that feature a consumer and convey his or her experience with a product or service as typical when that is not the case will be required to clearly disclose the results that consumers can generally expect. In contrast to the 1980 version of the Guides – which allowed advertisers to describe unusual results in a testimonial as long as they included a disclaimer such as “results not typical” – the revised Guides no longer contain this safe harbor.
The revised Guides also add new examples to illustrate the long standing principle that “material connections” (sometimes payments or free products) between advertisers and endorsers – connections that consumers would not expect – must be disclosed. These examples address what constitutes an endorsement when the message is conveyed by bloggers or other “word-of-mouth” marketers. The revised Guides specify that while decisions will be reached on a case-by-case basis, the post of a blogger who receives cash or in-kind payment to review a product is considered an endorsement. Thus, bloggers who make an endorsement must disclose the material connections they share with the seller of the product or service. Likewise, if a company refers in an advertisement to the findings of a research organization that conducted research sponsored by the company, the advertisement must disclose the connection between the advertiser and the research organization. And a paid endorsement – like any other advertisement – is deceptive if it makes false or misleading claims.
For the full text of the press release goto http://ftc.gov/opa/2009/10/endortest.shtm
For the text of the Federal ruling (if you want to learn the specific ruling) click here for the pdf
http://ftc.gov/os/2009/10/091005endorsementguidesfnnotice.pdf
Image courtesy of: Clearly Ambiguous
