Bloggers Beware of Big Brother

Many marketers have been increasing their budgets when it comes to social media and word-of-mouth marketing. In fact, marketers like Ford, Microsoft, and Pepsi spend billions on social media and word-of-mouth marketing. Additionally, PQ Media projects that marketers will spend $3.7 billion on word-of-mouth marketing in 2011. However, using well-known bloggers to boast about a brand or sending products to influencers to spread the good word could be scrutinized by the Federal Trade Commission (FTC) in the near future.

According to an article in Ad Age, the FTC is proposing that word-of-mouth marketers and bloggers, as well as people on social-media sites such as Facebook, be held liable for any false statements they make about a product they're promoting, along with the product's marketer. Roberta Jacobs-Meadway, a partner at Eckert Seamans Cherin & Mellott, a Pittsburgh law firm, said: "The FTC is ... putting out guidelines to make it clear to people who are involved in social media and viral marketing that the same rules apply in this context as they do in the more formal context of paid advertising and infomercials." There are no legal implications for social-media sites such as Facebook or marketer sites such as Amazon, where consumers often post product reviews. However, Ms. Jacobs-Meadway said, paid endorsers who post on those sites can be held liable if they do not identify themselves as such.

It is evident that it has taken awhile for rules and regulations to speed up to the realities that exist in 2009. Rich Cleland, assistant director of the FTC's advertising-practices division, said the commission is updating the guidelines to stay in step with evolving marketing practices. "The commission is attempting to update guidelines that are 30 years old so that they address current marketing techniques," he said, "and in particular to address the issue of whether or not the safe harbor that's currently allowed for 'result not typical'-type disclaimers is still warranted."

But will these rules and regulations be enforced in the near future? It turns out the FTC will review all public comments and concerns before the final vote. Organizations such as the American Association of Advertising Agencies, American Advertising Federation, and Personal Care Products Council have plenty of reservations. In its comment, the 4A's said while it and the American Advertising Federation want to ensure nondeceptive endorsements and testimonials, it "strongly urges the commission to reconsider the proposed, overly stringent amendments that will likely result in advertisers abandoning longstanding legitimate advertising techniques, such as consumer testimonials, and rejecting new media forms, such as blogs and viral marketing."

If the FTC passes the proposed plan, advertisers and agencies will be held responsible to understand the rules and inform their bloggers and promoters that they must comply. But could this actually be a catalyst in bringing a new array of problems that transpires when the government steps in, which may change the face of the advertising industry?

While many people fear the proposed plan because of Big Brother’s overarching presence, others feel that it will bring more credibility to word-of-mouth and social-media marketing. Jim Nail, chief marketing officer of TNS Media Intelligence and a WOMMA board member said "The thing that makes word-of-mouth marketing powerful is people believing they are getting truthful and honest opinions from real users. If people start disbelieving word-of-mouth marketing as much as they disbelieve advertising, we are in deep trouble."

Newspapers Dying a Slow Death

As newspapers lose readers and as advertising dollars dry up as a source of revenue for newspapers, publications are looking for new sources of income. Forging partnerships with start-ups and websites is one route that is being considered. Likewise, various companies and websites are rolling out new ways to drum up cash for local papers.

Zillow, a real estate Web site that provides estimates of homes values and other information, is pursuing a new way to generate revenue for local papers. “Newspapers have been left for dead by a lot of people,” said Spencer Rascoff, chief operating officer of Zillow.com. “Readying their obituaries is very premature.”

According to an article in The New York Times, the company recently announced a partnership to lend its real estate search engine to the Web sites of more than 180 national newspapers. For example, the online real estate section of the Richmond-Times Dispatch will now contain a Zillow-powered box geared towards homeowners or prospective buyers in central Virginia. The first 100 of Zillow Web sites went live, and the remaining 80 will be unveiled throughout the rest of 2009.

Since Zillow has the partnership with the co-branded sites it will share the revenue with the newspapers, and it also extends its reach into the local markets. Mr. Rascoff said,” “Real estate is the most local product there is. It would take us decades to build those local relationships. Rather than starting from scratch, we’re partnering with someone who has distribution, but don’t have the product.”

Despite the dismal economy and the stagnant real estate market, Zillow has seen a boost in business. In March, the website had 8.8 million unique visitors, a 70% increase over the last year. Additionally, the partnerships could help Zillow ride out the slowdown in online advertising, since the company primarily relies on an ad-based business model for revenue, which has proven challenging in the tumultuous economy. Ultimately, it is going to require newspapers to figure out a new model that works and adapt to different business models that generate revenue. As interest rates go down and prospective buyers and sellers start looking to buy homes again, Zillow is one company that is poised for growth. It will be interesting to see what other websites and start-ups are created as newspapers popularity fades. Small business experts say economic downturns can be a good time to start a venture.

An Advertising Lullaby

Advertising critics are everywhere. So when you come across a funny interpretation of how the advertising world works, it’s only the right thing to pass it on to other colleagues and friends. With the help of social networks like Facebook and Twitter, it’s easy to post such videos and share with friends. Although I still get emails from friends that like to share information, social networking sites are certainly the way to go.

Joe Pulizzi, a Facebook friend and colleague posted a video of George Carlin in action. He gives a clear warning that if you are easily offended then it might be a good idea not to proceed. However, the late and grate George Carlin is a memorable character, and to hear his take on the purpose of advertising was quite entertaining and definitely worth passing it along.

Check out the video for an entertaining depiction of advertising by the George Carlin from "You Are All Diseased" (1999):



It’s obvious that when consumers are not spending, and companies are laying people off and cutting budgets in half, many industries suffer. Often times advertising gets hits the hardest as Management feels that it is one area that can be scaled back. Executives who succumb to that temptation, however, put the long-term future of their companies at risk, according to Wharton faculty and advertising experts. "The first reaction is to cut, cut, cut, and advertising is one of the first things to go," says Wharton marketing Professor Peter Fader, adding that as companies slash advertising in a downturn, they leave empty space in consumers' minds for aggressive marketers to make strong inroads. Today's economy "provides an unusual opportunity to differentiate yourself and stand out from the crowd," says Fader, "but it takes a lot of courage and convincing to get senior management on board with that."

These difficult times represent an opportunity for companies to use integrated campaigns that mesh traditional outlets with digital media. Just because consumers might not be spending as much now that does not mean that they are looking to dwell in the recession. Eileen Campbell, chief executive of the Millward Brown Group advertising firm in New York City, says "If you can put a positive spin on how you can genuinely help without invoking doom and gloom, I think that's going to be more compelling." Ultimately, companies, marketers and consumers are in this dismal phase together and it’s going to take everyone to put one foot in front of the other to slowly get out of it.

The Power of CEOs

While times are tough, consumers are not making as many purchases and are concerned about how they spend every dollar. In these tough times, it’s interesting to see how consumers feel about their favorite brands and what comes to play when they actually make a purchase. Is price the major factor? Are they loyal to the brand and purchase its’ products despite the dismal economy? Do they pay attention to advertising? And if they do pay attention to advertising, do they like it when CEOs participate?

Over the years, there have been countless companies that have used CEOs in their advertising campaign. CEOs such as, Charles Schwab, Dave Thomas of Wendy’s, Frank Perdue of Perdue Farms, Dan Hesse of Sprint and Warren Buffet of Geico have either appeared on television or in print campaigns. While prominent and confident CEOs have taken the spotlight in recent years, an Adweek article has raised the red flag that companies should rethink this strategy.

“These CEOs have chosen an interesting time to be in the spotlight. With the news filled with images of overpaid executives flying corporate jets to Washington, D.C., as they plead for government assistance to keep their companies afloat, no CEO at a major corporation-even those not related to the banking or car industries-can count on any goodwill coming his or her way,” said Eleftheria Parpis, the writer of the article. Additionally the article refers to a recent Opinion Dynamics poll from Fox News. The poll found that 73% of respondents felt corporate CEOs were not honest or ethical.

Despite the poll and the state of the economy, several companies are still using high-level executives in their advertising campaigns. As I was reading this article, I found myself wavering back and forth as to whether I thought it was a good idea to have CEOs front and center. As a worker bee in the corporate world, I admire high level executives and firmly believe their statements and opinions when it comes to the company’s mission and dealing with the ever-changing world around us. On the other hand, I can understand how so many consumers are weary of CEOs based on the recent events pertaining to the financial world. The CEO is the ultimate decision-maker and is supposed to have a tight grip on all aspects of the business. This type of thinking and assumption is why so many Americans, including myself, are confused and frustrated as to how things got so bad.

Advertising and media agencies will continue to be creative when it comes to building campaigns for their clients. Although using CEOs might have been successful in the past, there is evidence that people are weary and suspicious of these high-level executives. One can only hope that the agency is well informed about the rumblings on the street and are aware of how the consumers feel about the company and industry as a whole. A true test would be asking consumers how they feel about certain companies and CEOs to gauge interest. Putting aside pictures in an ad campaign, I can promise you that if people saw certain CEOs of financial institutions out on the street they might not be too happy.

Not all CEOs have sneaky and selfish goals up their sleeves. Case in point, Dave Thomas built his multi-billion dollar fast-food restaurant chain from the ground up, earning him a reputation as one of the most successful and loved entrepreneurs in American history. He is also known for appearing in more than 800 commercial advertisements for the chain from 1989 to 2002–more than any other person in television history. Now something has got to be said for a CEO that has appeared that many times in commercials.

In memory of Dave Thomas, here is an oldie but goody:

It’s not fitness. It’s Life.

Now say it with a straight face. In case you have not heard or seen this tagline before, it belongs to Equinox. If you have ever entered an Equinox, most likely you will agree that it does not feel like a gym. A soothing and calming spa experience is more like it, which is why my serious, muscular boyfriend won’t join. Additionally, the gym is clean, including the showers, which my classmate Kim has also noted on her blog. Nevertheless, it has all the top-notch equipment, personal trainers, classes and after work social events.

Though the gym has a provocative advertising campaign, it has a keen eye to its members’ lifecycle within the renewal process. The gym has done a great job in communicating with me over the years and ultimately, this has caused me to renew year after year. As a 6-year veteran, I have given free passes to my friends and encouraged them to join. Even though the gym is a pretty penny, it’s worth it because I am doing a good deed for my body. It’s the one hour of the day that I set aside just for me.



Keeping the gym fresh in my mind with new tools and widgets is a smart way that Equinox engages with me throughout the year. Often times, brands do not reach out to customers throughout their lifecycle. This is a big mistake. Once you have a customer’s contact information, email address or birthday, it is so important to use that data in a meaningful way. Equinox does just that. Keeping me posted about new gym openings, sending me coupons, saying happy birthday and informing me about new classes are all positive ways to communicate with me via email. One notable feature that I enjoy using on the website is MYEQ. This section allows me to customize my page with my goals, keep track of my workouts and get access to classes at my specific location. Also, the gym syncs my check in time to this site, which is an added bonus.

Recently, the gym added a mobile feature to its campaign. Equinox gives you just about the same options as the MYEQ website. You can find a club, check your MYEQ calendar, search for a class or book a bike all with your mobile device. I have yet to use this feature but it makes me happy that the gym is being innovative and fresh with their tactics.



It is crucial that brands stay focused on their customer’s needs and the ever-changing marketplace. Interacting with customers on the website, inviting customers to participate through their phone, sending e-newsletters and enticing people with a sexy advertising campaign are just some of the reasons why I think Equinox is on top of its game.