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The FTC Goes Mobile

11 Oct, 2012 By: William I. Rothbard


As the world goes mobile, so does the Federal Trade Commission (FTC).

Earlier this year, the Commission held a public workshop to hear and discuss ideas for updating its “Dot-Com Disclosures” guidelines (created in 2000) to fit the new world of digital marketing, including social media and mobile advertising. Proposed revisions are expected to be out for public comment before the end of the year. Meanwhile, in an interim attempt to respond to the marketing chaos surrounding the tsunami of “apps” now flooding mobile devices, the FTC recently published a guidance document for app developers entitled, “Marketing Your Mobile App: Getting It Right from the Start.”

It’s a primer on truth-in-advertising standards and basic privacy principles for a burgeoning industry of mostly 20-somethings who probably have thought as much about FTC compliance as they have about planning for retirement. While intended for the “uninitiated,” it also could serve as a refresher on elementary FTC advertising and privacy standards for the more experienced direct response marketer. It’s available at www.ftc.gov.

The publication offers the following advertising guidance:

  • Tell the truth about what your app can do. An app developer needs to understand that just about anything it says about its product – whether on a website, in an app store, or within the app itself – is a claim, and anything it doesn’t say that’s material to a decision whether to buy and use the app could be a misleading omission. Objective claims for an app require solid proof (“competent and reliable evidence”) before they’re made, and if it’s a health or safety claim, it may need to be competent and reliable scientific evidence. Also, the meaning of a claim is what the “reasonable consumer” thinks. Look at your advertising from the perspective of “average users,” not app experts. The FTC already has taken action against app developers who made unsubstantiated claims their apps could treat acne, and no doubt is already on the prowl for its next app targets.
  • Disclose key information “clearly and conspicuously.” The tight space constraints of mobile platforms present unique challenges in complying with this basic FTC requirement, and for the FTC itself in developing effective disclosure guidelines. Nevertheless, whatever new guidance the FTC gives to mobile advertisers in its revamped “Dot-Com Disclosures,” undoubtedly it will be aimed at ensuring that material disclosures about an app or other product are big and clear enough for average users to notice and understand them.

On privacy, the publication tells apps developers to:

  • Practice “privacy by design.” Incorporate privacy protections into your practices and default settings by limiting data collection, securely storing data, and getting express user consent for non-apparent data collection or sharing.
  • Be transparent. Be up front about your data collection and sharing practices.
  • Honor your privacy promises. Whatever assurances your privacy policy provides about data security or use of personal information, live up to them. In the dozens of privacy cases already brought by the FTC, most have been for broken privacy promises or broad privacy statements that failed to disclose the extent of data collection/sharing.

About the Author: William I. Rothbard


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