Are you using affiliate links on your blog, website, or social media? Great! It’s a fantastic way to add an additional income stream for your business. Having said that, it’s critical to learn the legal side of affiliate marketing. There is definitely a right way and a wrong way to promote affiliate links.
In this post, we’ll take an in-depth look at what affiliate marketing is, who regulates it, and how to avoid some commonly made mistakes.
Before we begin, it should be noted that although I am a lawyer specialized in International and EU Law (LLB, LLM, PhD) by profession, this article is meant for educational and informational purposes only. It doesn’t constitute legal advice and doesn’t create an attorney-client relationship. Please read my full disclaimer for further information.
What is Affiliate Marketing?
If you are brand new to the concept, affiliate marketing is the process of suggesting or promoting someone else’s products and gaining commission when someone purchases that item through your affiliate link.
Affiliate links are provided to the marketer by a company or brand. The clicks those links receive are tracked and commissions are paid to the marketer if any sales are made.
Many companies offer affiliate programs to help boost their sales. They get more eyes on their products or services, the blogger/marketer takes a percentage of that sale, and the consumer doesn’t have to pay any additional cost. It’s a win-win situation for everyone!
The Laws of Affiliate Marketing
It’s vital to fully understand the legal side of using affiliate links. You are required by law to disclose any affiliation, personal relationship, compensation, or other conflicts of interests that you include in your blog or even social media post.
As an advertiser, you want to be upfront and honest about any affiliation you may have with the product, service, or company you are suggesting they buy from.
Who Regulates Affiliate Marketing?
There actually isn’t one regulating authority when it comes to affiliate marketing.
Each country has different laws, but almost all require advertisers to provide affiliate disclosures. It’s important to comply with the legislation of your country and where your customers are located.
In the U.S., it’s the FTC that regulates affiliate marketing practices.
Who is the FTC?
The FTC (Federal Trade Commission) is an independent agency of the United States government. This agency exists to protect consumers from deceptive and unjust business practices.
The FTC has guidelines in place that regulate affiliate marketing to ensure honesty and transparency.
Why Follow the Guidelines?
First and foremost, you NEED to comply with FTC guidelines to avoid legal issues. If you choose not to disclose affiliate links and provide a disclosure policy, you risk some pretty serious fines. Ouch!
Also, most companies and brands likely won’t allow you into their affiliate programs if you’re not complying with the standard guidelines.
Being transparent with your audience is also an important factor. Building an honest relationship with your readers will pay off in the long run.
You don’t want to be sneaky. Your audience deserves to know that you could benefit from them making purchases based on your recommendations.
How to Stay Compliant on Your Site
You need a disclosure statement on your site if you’re going to promote affiliate links.
The FTC allows advertisers to create their own disclosure statements, as long as they follow some basic guidelines.
You cannot simply say “This post contains affiliate links”. Your readers may not know what affiliate links are, so this is just not sufficient. You need to be very clear and never misleading. Never assume your audience knows every company or brand you are affiliated with.
To provide an adequate statement that it is clear and conspicuous as per FTC requirements, follow these guidelines:
- Your disclosure should be easy to read (ideally in a font the same size/colour as the post).
- The disclosure should be easy to find on the page. Readers should not have to search for it.
- It should be worded in easy-to-understand language, not legal jargon.
- Needs to be located BEFORE any affiliate links appear.
- Also needs to be placed on EVERY page or post where an affiliate link appears.
If you’re still not totally clear on what your statement should look like, this is the statement I use on my posts:
“This post may contain affiliate links, which means we may receive a commission, at no cost to you, if you make a purchase through a link. Please see our full disclosure* for further information.”
This short statement makes it very clear to my readers in plain language that I am affiliated with the products I’m suggesting to them.
I also make sure that this short statement contains a clickable link to my full disclosure where I cover my affiliate disclosure policy in depth.
Working with Companies and Brands
It should also be noted that some affiliate programs require their affiliates to disclose specific things in a certain way.
For this reason, it’s important to fully read a company’s affiliate agreement, terms of service, and/or terms and conditions before you begin promoting their products.
One example of this is the Amazon.com Associates program. This is a very popular affiliate program among bloggers and affiliate marketers. But their disclosure requirements are very specific. If you do not comply, it’s very likely you’ll be removed from their affiliate program.
Or if your website doesn’t have some basic disclosures already in place, you may not be accepted into the program to begin with.
Full Disclosure Policy
As I’ve mentioned, and you may have noticed this in my disclosure statement, I place a link to a “full disclosure” page. This is another important legal item you should provide to your readers.
I also have a link to my disclosure page in my footer menu so that it’s easily accessible from anywhere on my website. You can place this link on either the header or footer menu – whichever works best for your website layout and sitemap and to provide the best user experience.
On your disclosure page, you need to disclose in detail your full policy regarding affiliate links, sponsored posts, or brand collaborations.
Your simple disclosure statement should then link to your disclosures page.
If you’re not sure how to properly create a full disclosure page for your site, you can do so quickly and easily with my Affiliate Disclosure Course and Template.
The Affiliate Disclosure Course also offers a helpful bonus section to guide you through making your blog or website compliant with the Amazon Associates program.
P.S. Both of these items are also included in the popular Legal Bundle Value Pack™.
How to Stay Compliant on Social Media
You may have noticed influencers or celebrities promoting various products on Facebook and Instagram. Guess what? They’re likely part of affiliate programs too!
Even though you don’t need to provide a full disclosure statement on social media, you do still need to let your viewers know you have something to gain from these posts. Do not rely solely on disclosures that are built into social media platforms.
Since we are limited in the number of characters available on social media posts, the easiest way to disclose affiliations and sponsorships is to use hashtags.
You can write:
Or you can always simply say “this is an affiliate link”. Just don’t shorten the hashtags to something like #aff. Not everyone will know what that means and you don’t want to be deceptive.
-While you may think it’s wise to join a lot of affiliate programs to increase your sales, I don’t recommend doing so.
It’s important to recommend products you really believe in. Even better if you have personal experience with the things you promote. Your recommendation will come across as more genuine and trustworthy. And in turn, you’ll likely make more sales.
-Make sure you’re promoting products that are a good fit for you and your audience. Stick with products and services within your niche that will speak to your readers and help them solve a problem. Pushing affiliate links on them outside your typical content will likely not result in many clicks or purchases.
-Do your research. Before applying to any affiliate programs, take the time to learn a little about the company. Making sure the merchant’s views are aligned with your own will ensure you’re running an ethical, trustworthy business.
Now that you know who regulates affiliate marketing and how to properly disclose your links, you can feel confident knowing you are legally compliant in your affiliate marketing practices.
Just make sure you’re following the basic FTC guidelines and the requirements put in place by the individual affiliate programs you’re promoting.
I understand that for most, the legal part of blogging can be overwhelming. But taking the time to do it properly will not only protect you but will also make you look more professional and brands will be much more likely to partner with you.
If you’re still feeling lost when it comes to the legal side of your blog and just don’t know where to start, feel free to take my free course, Legally Blogs, or join my private Facebook group, Blogging for New Bloggers, to connect with me and 30K+ members.