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Affiliate Marketers May Get Amazon in Trouble with FTC

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Affiliate Marketers May Get Amazon in Trouble

Public Citizen called on the US Federal Trade Commission (FTC) to investigate Amazon for what it calls an “apparent failure” to ensure members of its affiliates marketing program disclose they receive commissions on sales generated, specifically related to Prime Day endorsements.

According to the organization’s press release on Citizen.org, “Although Amazon instructs associates to disclose online their relationship to Amazon, this instruction is often not prominent on the associates’ website, and it appears to be frequently and routinely flouted.”

Public Citizen called the practice “disguised advertising,” and its president Robert Weissman stated in the press release, “When people see a recommendation for an Amazon Prime Day ‘best buy,’ they have a right to know if the person or company making that recommendation is getting a cut on the sales it is generating – but all too often that information is not disclosed.”

In its complaint, Public Citizen says it compiled a collection of Amazon Prime Day recommendations and attached the list to its letter, “including 15 web-published articles that include no disclosure, four web-published articles that contain non-prominent disclosures, and 53 Instagram postings that include no disclosure and 22 with inadequate disclosures.”

In reporting on the complaint, Business Insider said an Amazon spokesperson told it that any associates who don’t follow its guidelines are subject to action and could see their accounts closed. “The spokesperson also said that Amazon monitors associates to ensure that the rules are being met,” Business Insider reported.

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The full complaint is published on the Public Citizen website.

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Ina Steiner
Ina Steiner
Ina Steiner is co-founder and Editor of EcommerceBytes and has been reporting on ecommerce since 1999. She's a widely cited authority on marketplace selling and is author of "Turn eBay Data Into Dollars" (McGraw-Hill 2006). Her blog was featured in the book, "Blogging Heroes" (Wiley 2008). Follow her on Twitter at @ecommercebytes and send news tips to ina@ecommercebytes.com.

4 thoughts on “Affiliate Marketers May Get Amazon in Trouble with FTC”

  1. I’m taking a stab at selling for affiliates via my Shopify site and I’ve never heard of this requirement. I list affiliate products on my site just like I do my own, so it’s not like I’m going out of my way to push a product with glowing reviews. It’s just an item for sale. So, do I need to worry about mentioning that it comes from Amazon in the listing?

    I will be doing blog articles featuring items soon, so I guess I’ll have to make sure I put some sort of disclaimer in there? I can see it being required in this respect because I am going beyond a listing title and description to sell someone else’s product.

    I’m wondering if I have to put a notice on every page that features an Amazon product (listing and/or blog article?) or if I can just put it in one place, like on my About page, policies or…? Also, when Public Citizen refers to “non-prominent disclosures”, what all are they referring to? As a writer, I typically cite any sources at the very end, which is what is required, but would it be considered non-prominent for a disclosure?

    1. P.S. — I should mention that my first blog post announcing the grand opening does mention that the site is “a one-stop shop for a wide variety of quality items from a variety of quality vendors of handmade, new and vintage.” I also plan to add more to my About page, including a mention about where I source most of the products. That was my plan before reading about this, so I’m just wondering if that’s sufficient.

      1. P.S.S. — I finally had a chance to check out the full letter and see that he is referring to disclosures at the end of a long page. I believe he referred to it as a “small disclosure”, but I wouldn’t say two full lines in normal sized, italicized text is small. If a reader got to the end of the article, they certainly saw that disclosure.

        So, what if they don’t get to the end before clicking to buy? Just like most shoppers don’t read even short product descriptions before buying? At what point does the consumer become responsible for doing their own research when it’s right there on the page?

        I know I’ve dealt with my fair share of deceptive practices where they don’t disclose vital information anywhere on the page. If it were on the page, I would have seen it because I was actually looking for any “fine print”. Although, these situations involved being signed up for some monthly service that I had no idea I was being signed up for by simply buying something.

        So I do know that much about the law, but I’m certainly not doing any of that. It was never my intention to hide what type of service I’m offering. I’m just trying to figure out to what extent I need to advertise how I’m making money. I’ve scoured the FTC site looking for specific information, but their wording is so vague (pertinent parts copied below).

        I’ve been thinking a lot about this since seeing this article because, while I’m not new to affiliate marketing, it has been a long time since I last considered and researched this endeavor. So, I’m just reminded that I should freshen up my research as things have the potential to change in a “new” industry (eCommerce, in general).

        So, while I might be thinking out loud, I am genuinely trying to work through what I’m required by law to do. The letter covers some specifics that the following does not cover. I have gone through the entire page at the source link and do not see anything specific about what is required. They keep talking about receiving eligibility information, but that doesn’t apply to me. So, am I missing something?

        (f) Concise—(1) In general. The term “concise” means a reasonably brief expression or statement.

        (k) Solicitation—(1) In general. The term “solicitation” means the marketing of a product or service initiated by a person to a particular consumer that is—

        (i) Based on eligibility information communicated to that person by its affiliate as described in this part; and

        (ii) Intended to encourage the consumer to purchase or obtain such product or service.

        (2) Exclusion of marketing directed at the general public. A solicitation does not include marketing communications that are directed at the general public. For example, television, general circulation magazine, and billboard advertisements do not constitute solicitations, even if those communications are intended to encourage consumers to purchase products and services from the person initiating the communications.

        (3) Examples of solicitations. A solicitation would include, for example, a telemarketing call, direct mail, e-mail, or other form of marketing communication directed to a particular consumer that is based on eligibility information received from an affiliate.

        Source: https://www.ecfr.gov/cgi-bin/text-idx?SID=4fbb0508ca181e7168aa3545dec1b0b1&mc=true&node=pt16.1.680&rgn=div5

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