Affiliate marketing is one of the most cost-effective techniques for monetizing web site traffic and driving sales. Unfortunately, it has a reputation for high risk. While the industry is unlikely to ever be risk-free, it is possible to manage risk by: (1) understanding how techniques like behavioral and contextual targeting affect consumers, affiliates and merchants, (2) understanding the legal and regulatory environment, (3) understating risks involved with prospective marketing partners, (4) using and maintaining proper contracts that allocate risk and provide appropriate indemnifications, and (5) keeping informed about the changes in technology, marketing practices and the regulatory environment. Attendees will learn how to identify these issues and develop policies and procedures to keep informed about the current technology, marketing strategies and regulatory compliance.
Topics covered include:
Behavioral/Contextual Advertising
Regulatory/Industry Compliance : FTC Guides & Enforcement Actions
CAN-SPAM compliance
IP Law: Rules governing use of others™ Trademarks/Keywords, Right of Publicity/Endorsement Issues.
Identifying, protecting against, and disputing accusations of Click-Fraud
5. • 42.9% of publishers say they use 2 - 5 websites
• U.S. Affiliate Marketing spend will reach $4.1B in 2014
(Forrester Research)
• 62% of U.S. online buyers use social networking sites Only
2% of U.S. online buyers have purchased through social
networking sites. (Forrester Research)
• Click fraud reached 12.7% in Q2 2009 – down from 13.8%
or Q1 2009 and from the 16.2% rate reported for Q2
2008. (Click Forensics)
Game Changing Numbers
13. a. Protect your Brand & IP Rights
b. Protect Against Fraud
Contracts: Merchants
14. Keep informed about changes in technology, marketing
practices & regulations. As Affiliate Marketing becomes
more pervasive, state legislatures, federal agencies trade
groups are reacting.
Compliance
15. State, Federal & Case law, as well as industry
guidelines and terms and conditions
• FTC Act and FTC rules
• CAN SPAM
• State and federal privacy laws
• Traditional advertising, promotions and consumer protection laws
• Industry guidelines
• Terms and conditions for social media platforms
Compliance
16. Review Program Contracts
• Guidelines for Keywords/Trademarks/Copyrighted Content
• CAN SPAM Compliance
• Privacy Issues
• Social Media Guidelines by Platform
“Legal” Audit
17. Links to Important Reources
Performance Marketing Assoc.
http://performancemarketingassociation.com/nexus-tax/affiliate-nexus-tax-the-states
Mobile Marketing Assoc. Affiliate Marketing Committee
http://www.mmaglobal.com/policies/committees/affiliate-marketing
Mobile Privacy
• H.R 210 mobile device tracking tech
Trends
18. Contact Details
David M. Adler
Leavens, Strand, Glover & Adler, LLC
203 North LaSalle Street, Suite 2550
Chicago, Illinois 60601
dadler@lsglegal.com
Main: (312) 488-4170
Direct: (866) 734-2568
Direct Fax: (312) 488-4177
www.lsglegal.com
www.ecommerceattorney.com
adlerlaw.wordpress.com
IndieFilmLaw.wordpress.com
LinkedIn: http://linkedin.com/in/adlerlaw
Twitter: http://twitter.com/#!/adlerlaw
Editor's Notes
New techniques like behavioral and contextual targeting affect consumers, affiliates and merchantsexplosion of social mediaFTC enforcementevolving privacy standards “big data” Do Not Track standardsMobile
Understanding the legal and regulatory environment is KEY to complianceFTC: Advertising/PrivacyState AGsCAN SPAMIndustry Initiatives
Behavioral and contextual targeting affects consumers, affiliates and merchants; + explosion of social media = myriad new interactions/concerns FTC enforcementLegacy Learning Systems (endorsements): $250k + consent orderClick booth (health claims & "fake" news sites) $2MM + consent orderEvolving Privacy Standards = “Big Data” + Do Not Track standardsAlso Mobile + Text Spam
Affiliate Marketing is shrouded in Uncertainty: what laws apply to affiliate marketing programs how to comply with these lawslawsuits have challenged various marketing programs and data collected by marketers. programs are governed by a wide variety of state and federal statutes and case law.This Preso provides an overview of the most popular types of programs as well as promotional text messages and mobile apps – as well as mobile privacy issues.
It’s a Numbers Game – Not about the brandTrafficEmail ListsAdWareKeyword Advertising Click FraudConversionContent
Protect your ContentDevelop unique Landing PagesGet product info from Merchants to create ArticlesAvoid simple IP mistakesKnow rights and limitations to use copyrighted content and trademarksAdvertisingBlogger Guides [handout]Epic marketing case (Browser-history sniffing) = FTC's deceptive practices enforcement had focused on affirmative misstatements (for example, in the Upromise case), Epic case marks continued trend -lack of transparency = inherently deceptive.
FTC: Affiliate Marketing Rule 16 CFR Parts 680 and 698 [Regulation No. 411006] - Implements the affiliate marketing provisions in section 214 of the Fair and Accurate Credit Transactions Act of 2003DMA Online Behavioral Advertising (OBA) Compliance: http://www.dmaresponsibility.org/privacy/oba.shtml
Contractual Provisions:Regulatory ComplianceCAN SPAMCOPPAUse of Third- Party Web SitesOn-Site “Stores” a la Auctiva/eBayRound-tripping“Bad” Traffic
Require Affiliates to identify Sub-AffiliatesRequire Affiliates to generate own contentAsk Customers how they found youProhibit Affiliates from purchasing your brand name for PPC campaignsProhibit Affiliates from incorporating brand names or domain names into theirs (typosquatting)Define Fraud: click-through rates that are much higher than industry averages click programs generating clicks unsubstantiated by site trafficAdvertiser-reported fraudulent leadsmuch higher conversions rates than industry averagesUse of fake redirects, automated software, and/or email abuse
FlogsAstroturfing: corporate or government messaging falsified as coming from the public or a grassroots movement. Fake News Sites: Clickbooth: FTC announced a $2 million settlement with the Clickbooth affiliate network over charges that Clickbooth’s affiliate marketers deceived consumers with “bogus weight loss claims on fake news sites” e.g. online6health.com, channel5healthnews.comSocial Media: Facebook, Inc. v. MaxBounty, Inc.,MaxBounty established a network of affiliates for which it created Facebook pages.