How the FTC's New Blogging Rules Have Legalized Advertiser Bribery

Last Updated Apr 29, 2010 1:46 PM EDT

When the FTC introduced new rules requiring that bloggers disclose gifts they receive from advertisers, it looked like it might bring an end to product placement payola. But the FTC's investigation of an Ann Taylor event at which bloggers received gift cards shows that the new rules have simply legalized a way for advertisers to bribe bloggers into giving them favorable coverage.

Ann Taylor held an "exclusive blogger preview" of its summer collection in January, and invited bloggers received a two-step "special gift" if they attended: Any blogger who posted an item about the event would then be entered into a "mystery gift-card drawing." The FTC looked into the event and decided not to take action, according to a letter from FTC associate director Mary Engle.

If you look at what the FTC letter says and how the Ann Taylor blogger promo worked, however, you can see that the apparel chain has apparently created a legal model for bribing bloggers. The FTC said it wasn't bringing action in part because:

It should be noted that LOFT posted a sign at the preview that told bloggers that they should disclose the gifts if they posted comments about the preview. It is not clear, however, how many bloggers actually saw that sign.
All well and good -- the new rules are supposed to promote such disclosures. Bloggers who attended also disclosed the gifts they received. But check out the invitation from Ann Taylor. The photo at right (click to enlarge) contains identical language to that published in this blind item on Fashionista. The invite's small print apparently added:
Please Note: All bloggers must post coverage from our event to their blog within 24 hours in order to be eligible.
To recap: Under the FTC's new rules, if an advertiser puts up a sign it can now legally bribe bloggers and demand coverage within hours, and any liability for the remaining non-disclosure is purely the problem of the blogger. With advertisers now insulated, I'm going to bet that the FTC will not expend too many resources chasing every single blogger in the country to enforce this.

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Image by Flickr user JMRosenfeld, CC.