Web ad disclosures examined

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The federal trade commission's attempt to quickly adapt print consumer protection guidelines to the Web is raising cautionary flags from both consumer and business groups.

Questions discussed at a recent FTC hearing included issues such as how high on a Web site disclosures, required for analogous print ads, should go. Marketers and ad agency executives attending the hearing worried that too strict a tie to print rules would, on one side, eliminate much of the Internet's usefulness and, on the other, allow marketers to bury disclosures at the very bottom of a long scroll bar.


"A full and fair disclosure is not one that says, 'Don't buy this' or 'Be leery of buying this product,' " before consumers see much else, said Ron Goldbrenner, general counsel of the Promotion Marketing Association.

"What I have heard about the Internet [from marketers] is that the most important thing is to get visitors to come and the second is to hold their interest. Internet regulation should preserve the fundamental benefit of what the Internet does best."

Consumers groups, however, said consumers need to see disclosures before wending their way through multiple screens of transaction information.

"We would be concerned if the disclosures were not being made high up before the purchases," said Deborah Hagan, an assistant Illinois attorney general representing state attorneys general.

The FTC and marketers attending the hearing, however, highlighted the complications of trying to prescribe where disclosures should go.

The FTC gave a hypothetical example of a Web page for a diamond marketer that included required disclosures, but hid them at the bottom of a long Web page under 8 inches of white space. FTC staff said they have seen similar pages on the Web.

Marketers and direct marketers, however, advised against any hard and fast prescriptions, talking about the technical and practical complications of issuing standards as Web technology changes constantly, industries that have widely differing sales processes and a medium with possibilities for buttons and links that print pages don't offer.


"It is important not to ask advertisers to do the impossible," said Dan Jaffe, exec VP of the Association of National Advertisers, noting the difficulty of getting disclosures on the same page as an offer--on his tiny Palm Pilot.

David Clauson, exec VP-worldwide marketing at iXL, an Atlanta-based Interactive agency and strategy consultancy, and speaking for the American Association of Advertising Agencies, said his agency's research shows consumers make the purchase decision at widely different times depending on the cost and type of product. They also return repeatedly to Web pages to get more information or compare pricing.


"The consumer wants information on their terms, not those of the marketer and not those of the government," he said, adding that the disclosure may need to be in different places depending on whether a site is about food, cars or credit cards.

Carla Michellotti, exec VP-assistant general counsel at Leo Burnett USA, speaking for the American Advertising Federation, warned against too much reliance on print ad rules.

"They were developed over 70 years because the consumer was not in control," Ms. Michellotti said.

"The new media has reinvented the power base. You don't have to demand placement and location but can instead give consumers the choice," she added, referring to the Web's ability to offer in-depth information.


The FTC said the meeting was intended to help it examine issues facing the Web but the agency has made no final decision on whether to provide an overall policy statement on Web disclosures, specific guides or suggestions for individual industries, or to proceed as it has so far through case-by-case enforcement.

If the agency gives advice, it is likely to be more in the form of guidelines than specifics, said agency staff.

"The question is how you make disclosures clearly and conspicuously," said Elaine Kolish, associate director for enforcement. "The bottom line is the net impression and will consumers come away with the idea that a statement is qualified."

The agency is accepting comments through July 1.

Copyright May 1999, Crain Communications Inc.

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