The use of “free” and general efficacy in consumer offers is obviously FTC’s latest enforcement focus. ValueClick is just the latest in settlements around using tantalizing incentive offers in lead generation. Some recent examples include:
ValueClick’s FTC settlement of $2.9 million is the largest to date, but is sure not to be the last. The guidance is clear from the FTC on the definition of “free” in advertising.
In fact, the FTC provides a lot of very informative guidance on the practices, or the “rules of the road,” they feel are important in online advertising and lead generation practices.
However, I think one of the key achilles heels of many of this companies has been the ability to manage and audit the practices of affiliates within their advertising networks. Affiliates are a powerful and important part of this business, but they increasingly are becoming a challenge to efficiently monitor and can become a significant liability. Most likely this intensity of FTC action and the difficulty in effectively policing their networks have led to the trimming of affiliate networks from majority mortgage advertising platforms like ELoan, LowerMyBills, and LendingTree.
If you are a mortgage marketer or advertising platform you might take note of the FTC’s latest focal point: Mortgage Foreclosure ‘Rescue’ Fraud.
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