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Is it ethical for businesses to pay customers in the form of discounts, refunds, etc. to post positive referrals about the company on the internet?

Is it ethical to make these types of posts without disclosing to the public that the person posting the referral has been compensated for their post?
 

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This is an interesting topic. Being part of the professional writers group I've always thought that it was boarder line taking free things and then writing about them. Although that practice with many writing groups is considered the norm, I've always thought the right thing to do was to buy the product, even at a professional discount. This way I had the leeway if I did not like a product or attribute about it to be honest and not feel obligated because I got something for free. I also think the right thing to do is to disclose any compensation or perk in regards to my relationship with the product.

The internet was been smothered with reviews and such over the years. I am in the tech business and have been an investor in the search market, one of the issues I've always talked about is how reviews on the net are really not that reliable. Some are honest, but some are planted by marketing companies etc. So its become hard to figure out if a review is legit or not.


On Tidal Fish I have always encouraged people to disclose relationships. For instance if someone got free lures from a company and writes a review, one should disclose that they received the lures free of charge. This way the reader at least can decide for themselves how much they weigh the review.


The US Federal Trade Commission actually was worried about the same sort of abuse and in 2009 changed its rules saying that you do need to disclose your relationship with a product if you were compensated in some way. That verbabge is below.


We can have the discussion if we think it is ethical or not, but I think at the end of the day for your own personal reputation if you are compensated disclosure is a good thing.


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FTC Publishes Final Guides Governing Endorsements, Testimonials
Changes Affect Testimonial Advertisements, Bloggers, Celebrity Endorsements


The Federal Trade Commission today announced that it has approved final revisions to the guidance it gives to advertisers on how to keep their endorsement and testimonial ads in line with the FTC Act.


The notice incorporates several changes to the FTC's Guides Concerning the Use of Endorsements and Testimonials in Advertising, which address endorsements by consumers, experts, organizations, and celebrities, as well as the disclosure of important connections between advertisers and endorsers. The Guides were last updated in 1980.


Under the revised Guides, advertisements that feature a consumer and convey his or her experience with a product or service as typical when that is not the case will be required to clearly disclose the results that consumers can generally expect. In contrast to the 1980 version of the Guides - which allowed advertisers to describe unusual results in a testimonial as long as they included a disclaimer such as "results not typical" - the revised Guides no longer contain this safe harbor.


The revised Guides also add new examples to illustrate the long standing principle that "material connections" (sometimes payments or free products) between advertisers and endorsers - connections that consumers would not expect - must be disclosed. These examples address what constitutes an endorsement when the message is conveyed by bloggers or other "word-of-mouth" marketers. The revised Guides specify that while decisions will be reached on a case-by-case basis, the post of a blogger who receives cash or in-kind payment to review a product is considered an endorsement. Thus, bloggers who make an endorsement must disclose the material connections they share with the seller of the product or service. Likewise, if a company refers in an advertisement to the findings of a research organization that conducted research sponsored by the company, the advertisement must disclose the connection between the advertiser and the research organization. And a paid endorsement - like any other advertisement - is deceptive if it makes false or misleading claims.


Celebrity endorsers also are addressed in the revised Guides. While the 1980 Guides did not explicitly state that endorsers as well as advertisers could be liable under the FTC Act for statements they make in an endorsement, the revised Guides reflect Commission case law and clearly state that both advertisers and endorsers may be liable for false or unsubstantiated claims made in an endorsement - or for failure to disclose material connections between the advertiser and endorsers. The revised Guides also make it clear that celebrities have a duty to disclose their relationships with advertisers when making endorsements outside the context of traditional ads, such as on talk shows or in social media.


The Guides are administrative interpretations of the law intended to help advertisers comply with the Federal Trade Commission Act; they are not binding law themselves. In any law enforcement action challenging the allegedly deceptive use of testimonials or endorsements, the Commission would have the burden of proving that the challenged conduct violates the FTC Act.


The Commission vote approving issuance of the Federal Register notice detailing the changes was 4-0. The notice will be published in the Federal Register shortly, and is available now on the FTC's Web site as a link to this press release. Copies also are available from the FTC's Consumer Response Center, Room 130, 600 Pennsylvania Avenue, N.W., Washington, DC 20580.


The Federal Trade Commission works for consumers to prevent fraudulent, deceptive, and unfair business practices and to provide information to help spot, stop, and avoid them. To file a complaint in English or Spanish, visit the FTC's online Complaint Assistant or call 1-877-FTC-HELP (1-877-382-4357). The FTC enters complaints into Consumer Sentinel, a secure, online database available to more than 1,700 civil and criminal law enforcement agencies in the U.S. and abroad. The FTC's Web site provides free information on a variety of consumer topics.
 

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IMHO - Word of mouth is the best advertising. Good products / service almost sells itself - especially boating / fishing gear.

That said - it is not right to promote a bad product / service just because you get something free.

It does not take long for folks to figure out who tells it like it is.
 

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Not a Good Idea!

Is it ethical for businesses to pay customers in the form of discounts, refunds, etc. to post positive referrals about the company on the internet?
You'll have to make the call on internet ethics.

As far as business ethics this is a bad idea.

It's only fare to charge each of your clients the same fee (rate) for similar trips. It would not be a good practice to start discounting only specific clients. If you offer a discount, offer it to all your clients. Once you loose your credibility as a professional guide you will loose your clients. People want to be treated equally.
Is it ethical to make these types of posts without disclosing to the public that the person posting the referral has been compensated for their post?
This is not necessary, if your clients enjoy their trip you will receive the best advertisement of all 'word of mouth' sharing their trip with others.

Referrals on the internet will come at no cost. That occurs only when people want to post about a trip.
 

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Eminent Brothers,
Ive seen it both ways with some people being nothing more then internet schills for certain businesses and other people just touting good service or product quality. But the question of ethics on internet message boards............excuse me while I check out my Facebook page
 

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Have not checked with my lawyer and do not intend to, but I do what seems reasonable to me. I have received special flies, clothing, fly rods, fly reels and lures to try. No contract was signed nor was there any paper work at all. If I like the stuff, catch fish on the tackle and find no faults with it, I pass that information on and sometimes that is on the net. If I do not catch fish with the stuff, I do not say anything. It could just be me that is not catching on it. Perhaps others will catch fish on the stuff and like it even though I did not. Many times I tell others I like stuff or do not like it that I have paid full retail for and just wanted to try.<?xml:namespace prefix = o ns = "urn:schemas-microsoft-com:eek:ffice:eek:ffice" /><o:p></o:p>
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If we are totally honest when we report that something really works well for us; whether we got it free, got a discount or paid full price, I think we are helping others. I appreciate seeing recommendations from TF members on fishing and boating stuff. Sometimes I agree with them and sometimes not. <o:p></o:p>
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If I see someone report that they recommend something and I have tried it and did not like at all, I keep quiet. Why burst their bubble or argue? I remember some years ago getting a rod that was really popular, it still is with some. I was in the flats and fired off a hard over head cast with a one ounce bucktail and twister tail. The rod tip was so soft that the lure hit me square in back of the ear--dropped me to my knees and the rod and reel dropped overboard. It was only seven feet of water and we retrieved the outfit with a weighted treble hook. I sold those rods at a flea market and would never buy one again. Some guys still use and love those rods. Could have been operator error. :eek2:<o:p></o:p>
 

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Let the buyer beware. There are ethical and non ethical people on the internet and everywhere else. It is up to you to sort through these people and process the info in your hair covered computer. Ethics and internet or even folks in general is a joke any more. There are ethical folks out there BUT you have to find them. The others will find you.............Gary
 

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Many years ago it was the norm for outdoor writers to write up products they received gratis from manufacturers. The late Don Carpenter, outdoor writer for the Capital and Gazette, would go down to the newspaper office and get newspapers with his articles and clip them out and send them to each manufacturer mentioned in his column. In turn he received alot of merchandise. Don never mentioned this in his columns. Contrary to what many may think outdoor writers are not paid exceptionally high salaries. I mean how much would you accept as pay if I told you I want you to go hunting and fishing all of the time and write about it? So I guess these freebies could be construed to be additional pay (perks) for the job. Doesn't bother me nor does it really hurt anyone.

The internet has created alot of wanna be writers in all fields not just the wonderful world of the outdoors. I include myself in this group. The only problem that arises is when an individual has a problem with a product, store, service etc. they write it up that it is the norm for everyone which may not be true. Same goes in the other direction. A store does what it should do in the customer service dept. and is gloated over unbelievably on this board. And then we have the guys who make products and sell them at local tackle shops and write over and over to support the local shops. Hmmm.

Just my 2 cents worth and I'm probably due change.
 

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A lot of phrases passed down from the Agrarian era are ageless. One that comes to mind is "separating wheat from the chaff." This is something we do in so many facets of our lives and a skill that improves with age. Some people have brains that are better tuned naturally towards intuition and perception, something that can be determined through personality tests such as Myers Briggs. I conducted job interviews for many years and was far more able to determine one's fit for a position through direct human interaction than through written resumes although they do tell you a great deal about one's experience, qualifications, accomplishments, attention to detail, etc. When you never have an opportunity to meet someone, referrals, testimonials and reputation weigh heavily in one's decision process. Internet scams were highly profitable in the early days of the Internet and still reel in enough naive fish to keep crooks trolling. Like any criminal, they adapt their lures over time. Unethical people can rationalize their behavior but once you lose your reputation and pride, that's something you cannot easily restore. We are all aware of some fairly unethical practices that push our buttons. I'm guilty of responding to some that I should ignore, particularly false claims or urban legends that I know for a fact through my professional life that are false and have difficulty not responding.
 
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