Live Issue... Brands wrestle with digital disclosure

 There’s a growing list of advertisers who have been burned in the social media space for failing to come clean about the ways they try to manage their reputations. The important question for brands is how much they should disclose, and under what circumstances.

Among the notable screw-ups is a series of Wal-Mart blogs from 2006 that were manufactured by Edelman in the US but posed as fan blogs chatting about their loyalty to the brand. And in January, US electronics firm Belkin was busted when an online sales rep was caught paying bloggers to write positive reviews of its products, as well as posting five-star reviews on Amazon.com. The New York Times found out and outed the company on its tech blog.

Agencies, therefore, advise erring on the side of caution when it comes to disclosure. “A brand is promise, it’s your core, and if you break a promise and abuse the trust of consumers you’re back at zero again,” says Sean Rach, outgoing managing director of OgilvyOne Hong Kong, emphasising the importance of true transparency when a brand embarks on a digital campaign. “And if you lie, you’re going to be found out and you’re going to look like a dummy.”

According to PR sources, brands, employees and agencies should almost always include a disclaimer about their relationship to the products that they write about, whether they intend to sway opinions or not. The exception? When sharing information on private accounts on social media sites such as Facebook or Twitter, where the audience has an intimate knowledge of the author.

“If employees use personal profiles to talk about and promote events or their company or brand, then I don’t think disclosure is mandatory in these informal settings because you are, in essence, voicing your personal opinion, but I would still recommend some form of disclosure,” says John Kerr, director of Edelman Singapore, adding that the responsibility to train employees of the repercussions falls on the shoulders of brands and agencies.

Kerr adds that brands should impress upon staff the “compliance and ethics rules that may cost them their jobs if they are crossed”, including the issues of legal liability, privacy and the repercussions of disclosing confidential material.

Director of digital communications for Burson-Marsteller Asia-Pacific Charlie Pownall adds that the method of disclosure on any platform or service could be as simple as a one-line disclaimer. “It’s basically advisable that companies at least include minimum information”.

In China, however, much of this goes out the window. According to one PR source, clients sometimes feel they can “get away with it more” in the market because netizens do not police the digital space in the same manner as they do in the West, and without the fear of social repercussion, clients try to push the boundaries.

Kerr says the most prevalent practice in China is pay-per-post, where brands pay bloggers for each post that speaks positively about a product. But even though the temptations in China may be greater, Kerr advises brands to think twice before trying to steer online opinion in this way. “The average consumer is pretty smart,” he says. “They can smell something that’s advertorial and paid-for whether or not we think they can.”

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This article was originally published in 10 September 2009 issue of Media.