The Pollack PR Marketing Group Blog

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Posts Tagged FTC

A Pulitzer Prize Not Won, A Credit Report Crackdown And An Airline Baggage Tax

Written by Noemi Pollack on April 15, 2010.

In recent news, there were updates on three of my blog topics of the last six months that caused me to have three “feel-good” moments.  And so, I thought I would share them, in descending order, with the most recent one first.

On April 8, 2010, writing in my blog headlined,The Added Costs Of Flying,” I took exception with Spirit Airlines’ plan to start charging passengers for carry-on bags at a $45 per clip. I argued that it would certainly send a better message to the flying public for airlines to have the courage to simply raise their air ticket prices (notwithstanding price war games), rather than have a barrage of fees for once-free amenities that would total a ticket price hike anyway — but without the “smoke and mirrors.”  I voiced concern that this might spur on other airlines to follow suit.

SpiritAir_lr

The update: According to an AP article reported by Harry R. Weber, “Six Democratic senators want to hit U.S. airlines with a tax if they charge passengers for their carry-on bags.” The senators hoped that this move would deter other airlines from following Spirit Airlines’ lead. We need to wait as to whether or not this gains traction to win support in Congress, but how wonderful is it for senators to take a stand on behalf of consumers?

On March 11, 2010, I debated in my blog headlined, A Furious Debate Heats Up As The National Enquirer Reaches For The Gold,” the worthiness of The National Enquirer as a candidate for a Pulitzer Prize, even though it actually qualified for that prestigious prize for having been the first to “out” the John Edwards story all the way through his denials of the affair and of fathering a child out of wedlock.

The update: Happily its entry did not win which, in my opinion, left the prestigious and legendary journalism, untainted.  But history was made anyway, and in a positive way, with the win of a cartoonist for SFGate.com, the online arm of the San Francisco Chronicle, and an investigative journalist at ProPublica who won Pulitzer Prizes for their work.  Although there was a previous wining online entry, Politifact, a database project of the St. Petersburg Times in Florida, this is the first time any online-only publication has won an award for editorial content.

Last November 4, 2009, I wrote in my blog headlined, The Federal Trade Commission (FTC) Is On The Prowl Again, that the FTC was not amused that credit rating companies were using the mandated free credit reports as a lure for charging a monthly service fee that alert subscribers to important changes in their credit status.  Apparently “free” was not actually free.  Still, although the FTC, at that time, countered with warnings as well as ads about their warnings, they did little else to prevent consumers from getting “bilked” by would-be free sites.

The update: According to a Sacramento Bee report, “To crack down on misleading advertising, the Federal Trade Commission is requiring companies offering “free credit reports” to state clearly that there’s only one authorized site to get them: AnnualCreditReport.com. The new rules, a mostly overlooked piece of last year’s massive credit-card reform bill, are aimed at deceptive radio, TV and online ads that hook consumers with catchy jingles and promises of “free” credit reports.

Good change is in the air…

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The Federal Trade Commission (FTC) Is On The Prowl Again

Written by Noemi Pollack on November 4, 2009.

federal-trade-commission-ftc-logo_jpgA few months ago, (blog of June 11), I wrote about the FTC that was then swarming around Mommy bloggers who were paid by companies, either with free products or fees, and mostly “behind the scenes,” influencing buying decisions.  This time around they are peering into credit rating companies that use the mandated free credit reports as a lure for charging a monthly service fee that alert subscribers to important changes in their credit status.

Apparently consumers have an insatiable appetite for knowing what other people know about them and, as such, have fallen into one of those schemes that counts on them not paying attention to the costs that are billed to them monthly, as they keep on checking their own credit rating.

Even though the FTC has said that a yearly free credit rating can be had through a government-mandated site, or by going to freecreditreport.com (owned by Experian and mandated by the FTC to be free, annually), companies like Experian, among others, are fending off the Feds with TV ads that push their own point – that financial misfortune can be averted if consumers track their credit status on freecreditreport.com.

According to an article in the NY Times on November 3, “the FTC is not amused.”

Surprisingly, the FTC countered with its own TV ad, featuring a trio remarkably similar to the gang in Experian’s commercials, singing a warning about not being misled and getting entangled in their web.

Isn’t there a ‘little law lying around somewhere’, that the FTC could easily enforce? Is that all the muscle they have?

Anyway it gets worse…

Apparently the FTC overlooked the real culprit, the credit monitoring services that are “a rapidly expanding niche approaching $1 billion in sales for which millions of people have signed up, often unwittingly.”  It seems that these companies have managed to convince the consumer that these services can be useful for identity theft victims, for example, who want e-mail alerts about new accounts that thieves might have opened in their name.”

No question about it that both the credit rating/monitoring companies are preying on confusion and/or paranoia and profiting from it.  As to why the FTC is tackling such a minor player in the larger scheme of things, it is because Congress recently passed a credit card reform law and attached a measure that directs the FTC to press sites like freecreditreport.com to provide more prominent disclosures.

What is not clear is why the FTC is resorting to a copycat measure in using paid TV ads as a communication tool.  It would behoove them to search out other formats and unleash an aggressive public information and education campaign such as tapping the editorial media, building an informational micro site and interacting with social media network groups, and more.

It’s their responsibility — and the public has a right to expect more…

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Mommy Bloggers Beware. Daddy Bloggers Are Moving In…

Written by Noemi Pollack on August 31, 2009.

OK, sharing is in.  Daddies are inching onto Mommy territory and marketers want a piece of the growing category of Daddy bloggers.  These are the same marketers who have mined Mommy bloggers to the “nines,” sending them product after product for them to write about, hoping to influence their large followers, some with hundreds of thousands of followers, into trying or better yet, “experiencing” the products, clearly for the purpose of purchase.  (Not much different from the pre-Internet old fashioned word of mouth tool as in “somebody told me about this product and I think it is great, you should try it,” but this time around, reaching thousands, rather than a neighbor or two.)

Enter Daddies, who in large part have allowed the phenomenon of the powerful Mommy bloggers to take place, simply by ignoring them and “letting them do their own social thing.” It took a while, but Daddies have started to recognize what their clever counterparts have known for the last few years — that as soon as they write about their kids, others write about their kids and, in a flash, a whole social network blossoms and they become influencers.

According to SmartBrief.com, Sony Electronics is jumping on this wagon with their new DigiDad project, giving Daddy bloggers new “respect” or, if you prefer, attention.  As such, Sony Electronics is teaming up with influential Daddy bloggers over the next three months, loaning them products like BRAVIA televisions, Blu-ray players, Cyber-shots, Alpha DSLR cameras, Handycam camcorders, VAIO notebook computers and Reader e-books and then asking them to use the products to do projects, like recording conversations with their parents or videotaping a family outing.  And of course, then write about the “experience.”

Clearly Sony is trying to parallel the success of Mommy bloggers, which grew faster than every other category on the Web except politics, according to comScore, an Internet traffic measurement company.  Although Sony emphasizes that the products it is sending Daddy bloggers are on loan, not gifts, and bloggers are not being pressured to write positive reviews, Daddies may now be stepping into the same minefields their Mommy counterparts did.  They may very well feel the looming shadow of the Federal Trade Commission (which I wrote about in my blog of June 11, titled The FTC Steps In Lightly) behind their back.  The FTC is toying with requiring certain types of disclosure and, as it moves in that direction, readers’ trust in bloggers’ opinions as unbiased, may begin to waiver.

Look, Dads have always gotten the short shrift when it comes to know-how or leading the charge of parenting, and I am glad that by raising the bar on Daddy bloggers, it will, at the very least, level the field.

The only thing that I still don’t get is the ongoing stereotyping – electronics for Dad, household goods for Mom.  In this “flatter” world, wouldn’t it be great to just move on…

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The Federal Trade Commission (FTC) Steps In, Lightly…

Written by Noemi Pollack on June 11, 2009.

It’s not news that large groups of bloggers influence buying decisions and that companies, in taking note, are sending free products to bloggers who have large followings with the hopes that they will either review the product itself or include it in their conversations with their followers.

Not really unlike the traditional route of sending a product to a journalist for review, with the exception being that journalists are ethically required to remain objective while bloggers, who may want to keep the flow of free products coming, might not always be.  The issue gets even murkier when companies, realizing that this is an inexpensive form of direct advertising, really a ‘goldmine’ for them, actually pay certain bloggers to write these reviews.

No wonder the FTC is taking note and planning to implement “self-regulation” policies for bloggers and other social media influencers, as detailed in a report co-written by Gunther Sonnenfeld of ThinkState and Emily Levin, a corporate attorney specializing in IP and eCommerce initiatives, “Why Brands Should Rethink Partnerships With Bloggers.”

And just in time, for problems abound…

One such example is that bloggers can make claims or have opinions about products that are not in line with the companies’ specs about a product.  This is worrisome, especially in the case of healthcare products.  The FTC position is that both advertiser and blogger are responsible for blogger’s false or unsubstantiated statements as well as the failure to disclose clearly that he/she is being paid for services – whether with free products or fees.

Another example cited in the report is that of a college student who has a reputation as a video game expert and maintains a personal blog where he posts entries about his gaming experiences and offer opinions about video game hardware and software.  As such it behooves the manufacturer of a newly released video game system to send the student a free copy of the system and ask the student to write about it on his blog.  The student tests the new gaming system and writes a favorable review.  Not much of a surprise here.   The FTC guideline states that the blogger should conspicuously disclose that he received the gaming system free of charge.

Look, advertisers can’t really play watchdog over conversations or disclosures, but it is their responsibility to monitor, as well as course-correct messaging and/or respective content positioning, to steer clear of the viral spread of misinformation about their products.  Moreover, reviews from paid bloggers cannot, and should not, be promoted as objective opinions.

And if a watchful eye from the FTC will help keep the boundaries between objective and subjective reviews well defined, I am all for it.  It may also engender a type of social responsibility that could spread throughout the blogging community at large…

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