If you have an Instagram account with thousands of followers, is it legal to accept money from a product in exchange for featuring them in a post? Is it okay for you to pay a blogger for publishing a positive post about your business? In the U.S., enforcing advertising laws and regulations — and answering questions like those — is the responsibility of the Federal Trade Commission (FTC). Below, we’ve collected links to several resources from the FTC that provide guidelines for small businesses related to advertising laws and regulations. By the way, here are the answers to the questions about paid posts on Instagram and blogs: It’s legal, but only if it is disclosed clearly to the reader or user that the post is a paid sponsorship.
Three basic “truth in advertising” guidelines
- Advertising must be truthful and non-deceptive
- Advertisers must have evidence to back up their claims
- Advertisements cannot be unfair
Additional laws apply to ads for specialized products like consumer leases, credit, ads with a 900 telephone number, and products sold through mail order or telephone sales. State and local governments also regulate advertising, and enforcement is usually the responsibility of a state attorney general, a consumer protection agency or a local district attorney.
Resources and guides to help a small business comply with federal advertising laws
- Advertising and Marketing Information for Small Businesses (FTC)Provides information and guidance about how to comply with laws covering truth-in-advertising, marketing, and product labeling laws and regulations. The site also includes information on specific types of products and services.
- Frequently Asked Questions: A Guide for Small Business(FTC)Offers answers to common questions about truth-in-advertising laws, unfair practices, and rules that apply to specific products and types of advertising.
- Guide Against Deceptive PricingOffers guidance on how to comply with laws regarding comparison and bargain pricing.
- Guide Against Bait AdvertisingExplains how to avoid illegal bait and switch tactics when pricing products.
- Guide Concerning the Use of the Word “Free” and Similar Representations (PDF)Documents the proper ways to advertise “free” items, such as “buy one, get one free” promotions.
Endorsements and Testimonials
- Guide Concerning Use of Endorsements and Testimonials in AdvertisingExplains how to advertise using endorsements from customers, experts, and critical reviews.
State and Local Advertising Laws
Individual states and some localities have also passed specific truth-in-advertising laws. The Consumer Action Handbook
Provides links to state and local agencies responsible for enforcing truth-in-advertising and related consumer protection laws.