AdAge asks IS BUZZ MARKETING ILLEGAL?
As marketers more frequently look to recruit consumers brand agents to spread goodwill for brands, industry attorneys view buzz marketing as a likely area of regulatory involvement, especially around the issue of compensating people to participate in buzz programs when they fail to disclose their connections to marketers and agencies. While there is no legal precedent specific to word-of-mouth marketing, there are Federal Trade Commission guidelines for ads that are likely to apply.
How far can they stretch this line of thinking? Is affiliate marketing a paid endorsement? Does every affiliate link need to be identified? How the hell would they enforce that?
In the offline world when you read a billboard it does not usually say SPONSORED BY in huge red letters. Celebrities endorse products they never use. What makes one type of advertising legit and another illegal?
Sometimes big fans of a company who love their products are great people to employ, and sometimes you only find those people after they state how wonderful your products are. Proving causality will be tough.
Viral marketing might be illegal, but some of the true web gurus think it is what drives the web:
It is a truism that the greatest internet success stories don't advertise their products. Their adoption is driven by "viral marketing"--that is, recommendations propagating directly from one user to another. You can almost make the case that if a site or product relies on advertising to get the word out, it isn't Web 2.0.
Some of these same people talking up buzz marketing being illegal during the day are probably working on buzz marketing campaigns at night.
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