Lord & Taylor in trouble after hiding relationship with social media influencers

Bloggers required to reveal biz partnerships

This past week, Google advised bloggers to disclose relationships when they were talking about products in exchange for freebies. In addition, when linking back to these businesses, bloggers were advised to add “no follow” links, because these links do not occur organically. In other words, businesses cannot send products to bloggers for free, expecting a link back to their website. It goes against Google’s policies.

If that isn’t enough to make your business take notice, then you should probably be aware of what happened with Lord & Taylor. In 2015, the retailer sent out 50 dresses from its Design Lab line to “fashion influencers” who were then asked to post pictures of themselves wearing the dress during a specific 2-day period in March.

Lord & Taylor’s social media deception

These influencers were also paid an amount between $1,000 to $4,000. The agreement specified the instructions for referencing the clothes, but did not request that the bloggers identify their relationship with Lord & Taylor. The bloggers posted pictures without disclosing their “paid” promotion. It’s estimated that some 11.4 million saw the posts on Instagram in just 50 posts. None of the posts included an advertising disclosure. In fact, Lord & Taylor reviewed each of the posts before they went up on Instagram, and none of their employees thought to add it.

The FTC chimes in

The Federal Trade Commission determined that Lord & Taylor violated the FTC’s Act concerning prohibition against deceptive or unfair business practices. The FTC essentially sanctioned L&T and the two organizations reached a settlement in which L&T is required to disclose all paid advertising. It’s basically a slap on the wrist, reminding the retailer that it must obey the rules. In an email statement to the Consumerist, L&T denied that the company was attempting to deceive customers. It also stated that they had fully cooperated with the FTC’s investigation.

Reminding businesses to be above board

If you are using influencers as promoters for your business, you need to make sure you’re following the law. Make sure that they are disclosing any relationship, whether you are paying them or just providing free products. It’s good lesson to every business to follow the rules.

#FTCInfluencerCrackdown