December 3, 2009
Gear Review Disclosure
The FTC has enacted new regulations which impact websites and bloggers who publish gear reviews. In particular, the FTC now requires disclosure of any relationship between advertisers and publishers which might not be obvious to visitors.
SierraDescents is affected by these regulations (practically every website is). At first, I was annoyed by these new rules, which will mean a bit of work on my end for compliance. But, as I've had time to think things over, I'm starting to believe the rules are for the better. Ironically it was an experience I had recently looking for objective reviews of a new dental product that crystalized my opinion. I realize that a great many reviews on the 'net are little more than paid advertisements masquerading as editorial content. If the FTC rules help clean up the trash, I'm all for it. As for my disclosures, here goes:
SierraDescents gets gear for review in several ways. The first and easiest is I just buy it from REI or A16 or Amazon or whoever. I pay using my own (aka my wife's) money, and I don't get any special treatment or discount. In the FTC's eyes, no hidden relationship exists, and no disclosure is necessary. Scenario 2 is that I occasionally get gear at a discount. This includes Professional Pricing accounts from gear manufacturers, and courtesy discounts from merchants who advertise on my site. If you're curious, these discounts typically run around 35% off full retail: good but not great. The FTC hasn't really issued specific guidance in this 'discount' case. Are we supposed to disclose it or not? Probably, given that there is a relationship in place.
SierraDescents also writes letters, letters, letters to gear manufacturers begging for review samples. Most of these go unanswered (TNF, I'm talking about you!), but occasionally companies agree to send gear free of cost. The downside is that they usually want their samples back—and the brutes often even make me pay return shipping! But...sometimes, they let me keep things for free. Or I forget to send them back (sorry, Cascade Designs!). I've found that I do feel the temptation to be a little nicer to companies who send me things for free, but I am also fairly crusty by nature, and I always take my job as an objective critic very seriously.
To comply with the new FTC regulations, as I add new product reviews I will be trying to include a disclosure tag explaining where the gear came from. I'll also be working backward through my existing reviews to add disclosure notices, though that is going to take some time. The ultimate effect of this, I think, is that I won't feel any temptation to sugar-coat a review. If you know I'm getting something for free, and I say only, 'best such-and-such ever', that would look a little fishy, wouldn't it? So on balance, I'm all for the new rules. I hope they have a positive effect on my work, and more importantly on the quality of reviews you'll find on other websites.
One final disclosure: SierraDescents earns the bulk of its income (such as it is) from affiliate-channel advertising on gear review pages. The FTC is silent on this subject, though you'd think this would be one of the more obvious potential conflicts of interest. Affiliate ads are the merchant/price text links you see on all my gear pages, like here.
If you happen to click one of these links to view a product and then make a purchase in about 30 days or less from that merchant, SierraDescents gets a commission (typically 5-10%) on the sale. Interestingly, most of the sales generated via these links come not on the actual product under review, but for something else, which does lessen the temptation to hype a product to try to sell it. For those of you interested in helping support the site, by the way, making purchases via my affiliate links (found on review pages only) is a very easy way to contribute. Note that these commissions come from the merchant's advertising budget—they are not surcharges—so you are always getting the best price available at that merchant.
I think of the affiliate model as just a more efficient form of traditional advertising, though many cash-desperate state legislatures are trying to make the case that affiliate-driven sales constitute a taxable event in which publishers are acting as an in-state sales force. This remains a hotly contested issue, as States do have a legitimate beef with the way online retailers get to avoid paying sales tax.
Anyhow, that's it for my confessions. If what I've described here is news to you, this is probably how most of the other small websites you regularly visit operate. I know I've heard rumors of bloggers making six-digit salaries and getting a wild array of free products, but that's not the case here. I do remain hopeful that someday my poor wife will be able to quit her soul-crushing civil service job in a windowless office in the bowels of Santa Monica. Until then, well, I'll just have to keep skiing. :)