promotional pros and legal pitfalls of social media ... · social media/online advertising the...

Social Media/Online Advertising

Promotional Pros and Legal Pitfallsof Social Media Campaigns

and Online Advertising

WELCOME TO OUTDOOR UNIVERSITY®


PresenterJim LahrenPrincipalJAL Consulting

http://www.linkedin.com/in/jimlahren

http://www.linkedin.com/in/jimlahren�


Presenter

Matti Neustadt StorieAttorneyStoel Rives, LLP

http://www.linkedin.com/in/mnstorie

Twitter.com/tipitweet

http://www.linkedin.com/in/mnstorie�

http://www.linkedin.com/in/mnstorie�

http://twitter.com/tipitweet�


• Successful and Unsuccessful Uses for Social Media

• Legal Pitfalls In Social Media Marketing• Recommendations

This Session Will Cover


How Did We Get Here?• Moore’s Law

– In 1965 Intel co-founder Gordon E. Moore wrote that the number of components in integrated circuits doubles every two years, and its price cut in half.

• What does this mean for us?– More powerful computers. Think smart phones, think iPad!– More access to technology– More data– Amazing innovation


The Power of Social Media• Web-based and mobile technologies that turn communication

into interactive dialogue• Creation and exchange of user-generated content (consumer-

generated media)• Highly accessible and scalable communication techniques

Blending of technology and social interaction for the co-creation of value.


How do I use Social Media?


Why is Social Media So Important?


What Website Has?:

– 400 million users, 100 million access via mobile device

– 60 million status updates daily– 3 billion photos uploaded monthly– 50% of users log on at least once every day– Average user spends over 55 minutes per day– 1.5 million businesses have a presence


Consumers Interact with Brands

Source: 2010 Cone Consumer New Media Survey


Research – Consumer and Company• Trust.

– Who do consumer’s trust?– Who should they trust?

• To the Web!– 91% of consumers (age 25-34) go online to verify

recommendations before making purchases.– Over three-quarters of all consumers are more likely

to purchase goods when they find additional information online.


Brand Promotion• Many companies are using Facebook and

Twitter to:– Announce promotions early– Offer special pricing, contests

• Consumers use Facebook and Twitter to:– Get referrals and product information.– Check pricing.– Look for discounts.


Example:• Timberland


Social Media Dangers• Negative PR

– Consumer complaints– Company mistakes– Information online is never truly deleted.

• Legal Liability– False Advertising– Consumer Warranty Claims– Misappropriation of Intellectual Property– Criminal Acts


Company Missteps - Misuse of Hashtags

What happened?• Kenneth Cole misappropriated the

hashtag ‘#Cairo’ in order to take advantage of the high volume of twitter searches on Egypt.

• The ‘#’ denotes a hashtag, a convention used to organize thematic conversations in Twitter.

Impact to Kenneth Cole:• Worldwide negative publicity

significantly damaging the brand.


Company Missteps - Poor Customer ServiceWhat happened?• United broke a passenger’s

guitar and refused to reimburse him the $1,200 repair cost.

• He uploaded a music video on YouTube about his experience.

Impact to United Airlines:• Video went viral and now has

over 10 million views.• 10% stock decline, costing

shareholders $180 million.


Company Missteps – Don’t Insult Your CustomersWhat happened?• Company ‘rudely’ told consumers

that they could not use an altered version of the company logo as their profile pic.

• To make matters worse, Nestle publicly responded to individual consumers

Impact to Nestle:• Became a media story on ‘what not

to do in social media’


Legal Pitfalls: Corporate vs. Fan Pages• Corporate Pages

– Ran or controlled by the company.• Fan Pages

– Run by “fans”– No corporate control– Lots of consumer comments.


Legal Pitfalls: Trademarks• Consumer Confusion is the Brand’s

Responsibility• Monitoring “Fan Pages” .• Policing your brand

– Social media policies are necessary to protect the brand.

– Tiffany v. Ebay


User Generated Content (UGC)• Product Reviews

– Sponsored or unsponsored?• UGC is Advertising

– Section 230 of the Communications Decency Act.

• Hosting UGC– DMCA Policy– Copyright Agent registration

• Product Ideas


Legal Pitfalls: Intellectual Property• Trademarks• Publicity and Privacy• Copyrights


Legal Pitfalls: Misappropriation of Intellectual Property

• What do “milk-a-holic” babies, hair extensions, and robots have in common?

• Rights of Publicity Lawsuits


Legal Pitfalls: Rights of Publicity• Intellectual property law protects a

person’s right to control commercial use of his or her name, likeness, or image.

• It does not matter if the image is posted online for other reasons.

• You must have permission!


Legal Pitfalls: Copyright

• Online ≠ “Public Domain”• Copyright protect an “author’s” right to copy,

distribute, display, broadcast, and make derivatives works of their own works.

• A single online posting can violate all of those rights in one click of a mouse.


Legal Pitfalls: Copyright Infringement• Direct Infringement• Inducement

– Contests– Peer-to-Peer applications


Copyright Infringement• Remedies:

– Actual Damages PLUS Profits– Statutory Damages– Attorneys Fees & Costs


Legal Pitfalls:Contests and Sweepstakes• Opportunities on Social Media

− Contests to develop marketing campaigns − Publicity and traffic from random giveaways

• Official Rules− Eligibility− Intellectual property rights− Licenses− Releases from liability


Legal Pitfalls: Criminal Activity• Illegal Lottery or Promotional Giveaway?

– Chance– Consideration– Prize

• Example: “Penny Auctions”• Social Media is Global.


Legal Pitfalls: A Variety of Claims• False Advertising

– Claim Substantiation– FTC Endorsement Guidelines

• Misappropriation of Intellectual Property• Trademark Protection• Consumer Warranty Issues• Criminal matters


Legal Pitfalls: False Advertising• Claim Substantiation• Endorsements

– if an ad features an endorser who’s an employee of the marketer, the ad is misleading unless the connection is made clear.

– Ditto if the endorse received anything “of value” for the endorsement.

• Class Action Risks.


Legal Pitfalls: False Advertising• “Green Claims”

– Enforcement by regulators, competitors and consumers.

• Certifications – sloppy or corrupt organizations can do more harm than good.

• Providing references to the full story– Example: www.prAna.com/npi

• New FTC guidelines on Green Marketing

http://www.prana.com/npi�


Legal Pitfalls:Consumer Warranty Claims

• Consumer Warranty = Factual Statement About a Product.

• Magnusson-Moss Warranty Act applies to “written warranties”.– Web postings are “written”.

• Who has the ability to make these statements?


So What Do I Need do Do?


So What Do I Need do Do?• Create Customer Agreements

– Web Site Terms of Use – Privacy Policy

• Create a Social Media Policy• Implement policies across the company

– Marketing Departments– Executive Management


Social Media Policy: What’s In It?• Corporate Use Policy

– Following people– Understanding your customers– Privacy Issues– Engaging User Generated Content

• Agency Guidelines– SEO Firms– Social Media Agency Disclosures


Social Media Policy: What’s In It?• Employee Use

– Employee Blogs• Brand Management• Authority and Accountability• Accuracy• Lawfulness


Social Media Policy: What’s In It?

• Enforcement Guidelines– Human Resources Policies– The Executive Loudspeaker– Third party compliance


Take Aways• You CAN participate in Social Media. • The key is awareness. Know:

– If you have Social Media Policy.– How you can improve your Social Media

Policy and/or Procedures.– What your highest risks areas are.

• Teamwork and Communication


Questions?

Jim LahrenJAL [email protected]

Matti Neustadt StorieStoel Rives [email protected]


Thank You

promotional pros and legal pitfalls of social media ... · social media/online advertising the...

Documents