Interview with Linda Goldstein: How Social Media Has Affected Advertising Law
Linda Goldstein (’78) is a partner at Manatt, Phelps, and Phillips as well as chair of the Advertising, Marketing, and Media division. She has represented clients in advertising, intellectual property, and media-related issues.
Q: How did you get into Advertising law? Did you always know that you wanted to be an advertising lawyer?
A: I was at a large law firm doing litigation when an opportunity to go in-house at what was then the largest ad agency in the country, Young & Rubicam, presented itself. I decided to make the move, but quickly became bored. However, I wanted to pursue advertising law on a more sophisticated level, so I joined a firm that specialized in marketing and advertising law and served as outside counsel to many agencies and brands.
Q: How has social media changed over the course of your career?
A: There have been a few major changes that have affected the landscape of the law. It is a much less controlled environment, which creates many risks for brands that do not exist in traditional media, where the brands are in control of everything happens. In traditional media, the only one talking about the product is the brand itself. With social media, you are essentially inviting everyone who is active on the social media’s platforms to engage in the conversation with you, resulting in far less control over what is being said about the brand. That creates risk. On the other hand, it also creates tremendous opportunities for brands to engage with customers and potential customers in a much more meaningful way about their products and services. Social media has generated a lot of opportunities for brands to essentially advertise and get their messages out in ways that are much more palatable to consumers. The enormous amount of data being collected through social media allows brands to target messaging in ways simply not possible with traditional media, which can be highly effective. That being said, brands are still struggling with how to measure the effectiveness of social media.
Q: Are there any trends you predict in the future of advertising of social media and how will those trends affect the law?
One of the biggest trends is a move from textual communications to visual communications. With platforms like Vine and Instagram, a lot of the content being generated is more visual in nature. Another trend is an increased emphasis on storytelling, trying to create stories around the brand or the product, which sometimes blurs the line between what’s advertising and what’s editorial. Examples of that would be sponsored posts, sponsored texts, and content curated specifically for brands. This is called native advertising and it has recently attracted the attention of the Federal Trade Commission, which is concerned that consumers may not be able to distinguish between what is advertising and what is editorial content.
Another huge factor is the growth of mobile. Over 66% of social media platforms are currently being accessed through mobile devices. This means we are achieving a true convergence between mobile and social media.
Q: What are the implications of that legally?
A: Some of the legal implications of that are that the widespread use of social media by brands has already led to government oversight and regulation of social media. In 2010, the FTC issued revised testimonial endorsement guidelines that were specifically aimed at social media. The most significant provision was the requirement that any material connection between an advertiser and a social media advocate has to be disclosed. It is the brand’s responsibility to make sure the disclosure is made. That means that if a brand engages its employees or bloggers, or even consumers, to say nice things about their products in exchange for any kind of incentive, even a small one, the fact that some incentive was provided has to be disclosed. The FTC has already brought a few cases against companies who failed to comply with that requirement, such as Ann Taylor and Hyundai. The FTC also recently issued new requirements for disclosures in online and mobile platforms. Many social media platforms have very limited space, like Twitter and SMS, which makes it very difficult to make all the disclosures that might otherwise be required in an advertisement. The FTC has said that lack of available space is no excuse for lack of disclosure, and that is creating a real challenge for marketers.
Q: How do you foresee the law responding to this?
A: As marketers become continually more creative in their use of social media, regulation will likely increase. Privacy has always been, and continues to remain, a huge issue, particularly as the ability to gather and collect data continues to grow. The FTC has brought several cases against the major platforms relating to their privacy policies, and I think that is likely to continue. The other area we may see more guidelines, if not regulations, is on this emerging native advertising issue. As more marketers turn to mobile, an already heavily regulated area, this will be likely to lead to more lawsuits down the road.
Q: Any Final Thoughts?
A: The law has not kept pace with the evolving technologies, which creates lots of challenges for marketers, but there is no doubt that brands appreciate the power of social media and will continue to embrace it new and different ways.
Melissa Goldstein is a J.D. candidate, ’15, at the NYU School of Law.