TTB Position On the Use of Social Media in the Advertising of Alcohol Beverages

[Gwydion Stone]

For those of you who may not be receiving the weekly TTB Newsletter (which I highly recommend), the new Industry Circular will effect most of us, so I'm reposting it here in its entirety.

In a nutshell, the TTB considers our web presences—websites, facebook pages, twitter, blogs, etc.—to be "advertisements" and requires that we post the mandatory statements somewhere on our profile pages of each of these.

Industry Circular 2013-01

Use of Social Media in the Advertising of Alcohol Beverages

To: Proprietors of Bonded Wineries, Bonded Wine Cellars, Taxpaid Wine Bottling Houses, Beverage Distilled Spirits Plants, Breweries, Importers, Wholesalers and Others Concerned.

1. PURPOSE.

This circular provides guidance to industry members and others on the Alcohol and Tobacco Tax and Trade Bureau’s (TTB) position that the advertising provisions of the Federal Alcohol Administration Act (FAA Act) and the implementing regulations under 27 CFR parts 4, 5, and 7 apply to all advertisements (as defined in the regulations) in any media, including social media. This guidance provides a basis for voluntary compliance with the FAA Act and the TTB advertising regulations with regard to social media, both in terms of required mandatory statements and prohibited practices or statements.

2. AUTHORITY.

Section 105(f) of the FAA Act, 27 U.S.C. 205(f), authorizes the Secretary of the Treasury to prescribe regulations for the advertising of wine, distilled spirits, and malt beverages. The FAA Act requires that these regulations prevent consumer deception; prohibit the use of misleading statements, irrespective of falsity; and provide the consumer with adequate information as to the identity and quality of the product advertised.

The TTB advertising regulations promulgated under the FAA Act are as follows: 27 CFR part 4, subpart G sets forth the regulations for advertising wine; part 5, subpart H sets forth the regulations for advertising distilled spirits; and part 7, subpart F sets forth the regulations for advertising malt beverages. More specifically, the regulations contained in §§ 4.62, 5.63, and 7.52 require certain mandatory statements (e.g., responsible advertiser name and address) to appear in advertisements for wines, distilled spirits, and malt beverages, respectively, and the regulations contained in §§ 4.64, 5.65, and 7.54 prohibit certain advertising practices and statements from appearing in such advertisements. In the case of malt beverages, TTB’s advertising regulations apply to the extent that state law imposes similar requirements with respect to the advertising of malt beverages introduced into or received into the particular state.

3. BACKGROUND.

TTB reviews advertisements that appear in various media, including print, television, outdoor, and website advertisements, and enforces the regulations related to advertising for alcohol beverages.

Advances in technology have led to the development of new forms of advertising (i.e., social media) that are interactive, allowing consumers and industry members to generate content and create links between various social media outlets. These outlets include, but are not limited to, social network services such as Facebook or MySpace, video sharing sites such as YouTube or Flickr, weblogs or “blogs,” forums or comment sections directly on websites, and applications (apps) for mobile devices. With the emergence and growth of these types of media outlets, TTB is expanding the breadth of its advertising reviews.

4. DISCUSSION.

The TTB advertising regulations state that no industry member (for the purposes of this Industry Circular, persons described in §§ 4.60, 5.61, and 7.50), shall directly or indirectly or through an affiliate publish or disseminate or cause to be published or disseminated an advertisement that is in, or calculated to induce sales in, interstate or foreign commerce unless the advertisement conforms to the regulatory requirements. The scope of the regulations is very broad, covering all forms of advertisements, including “any other printed or graphic matter.” The definition of advertisement in §§ 4.61, 5.62, and 7.51 includes any written or verbal statement, illustration, or depiction that is in, or calculated to induce sales in, interstate or foreign commerce, or is disseminated by mail. The regulations list specific types of advertising, including “any other media.” TTB interprets “any other media” in the regulations to apply to advertising in all types of media, including types of media that did not exist when the regulations were originally adopted.

The following guidance is intended to assist industry members in ensuring that advertisements for alcohol beverages that appear in social media outlets comply with the FAA Act and the TTB advertising regulations. Because of changing technology and the ongoing evolution of social media, this is not intended to be an all-inclusive list of the types of social media. However, the general principles set out in this circular can be applied to other social media outlets that have been or will be developed.

We also note that this circular provides general information regarding TTB’s enforcement of the advertising provisions of the FAA Act and TTB regulations. TTB evaluates specific advertisements on a case-by-case basis under the advertising provisions.

• Social Network Services (e.g., Facebook, LinkedIn, Friendster, MySpace, etc.).A social network service is a service, platform, or site where users communicate with one another and share media, such as pictures, videos, music, and blogs, with other users. Many industry members have created pages on social network services for their company and/or a particular brand. These are sometimes referred to as “fan pages” or “pages,” and users of the social network service can become “fans” of the company or brand, creating a link between their own page and the fan page. The purpose of fan pages is to increase brand awareness and loyalty by allowing industry members to communicate with consumers in an interactive manner. TTB considers fan pages for alcohol beverage products or companies and any content regarding alcohol beverage products posted to the pages by the industry member to fall under the category of “any other media” in TTB’s regulatory definition of advertisement, and therefore the fan pages are subject to the provisions of the FAA Act and TTB regulations.
  Because TTB considers industry member fan pages for alcohol beverages to be advertisements, all mandatory statements required by the regulations (in §§ 4.62, 5.63, and 7.52) must be included on them. TTB views the entire fan page (i.e., the “home” page and all sub or tabbed pages directly associated with the “home” page) as one advertisement, so mandatory statements need only appear once on the fan page, either on the “home” page or on any sub or tabbed pages directly associated with the “home” page. The regulations require that mandatory statements on alcohol beverage advertisements be: (1) conspicuous and readily legible; (2) clearly a part of the advertisement; and (3) readily apparent to the persons viewing the advertisement. Thus, mandatory statements may not be hidden or buried in an obscure location on the fan page.
  Although the regulations do not require that mandatory statements appear in a particular location, TTB strongly recommends that, for the benefit of consumers, advertisers consider placing mandatory statements in a location where a viewer would most logically expect to find information about the brand or the company. This is generally called the “profile” section, though it might have a different name depending on the service and may change as social media sites are updated or revised (e.g., currently on Facebook, it is the “About” section).
  The regulations regarding prohibited practices or statements (in §§ 4.64, 5.65, and 7.54) also apply to social network fan pages. Any information or images posted to a fan page by an industry member, including content created by a third party and reposted by an industry member, is part of the fan page and therefore considered to be part of the advertisement. Similarly, TTB considers any information or images posted to industry members’ websites by the industry member to be part of the advertisement.
  
• Video Sharing Sites (e.g., YouTube).Video sharing sites allow individuals or companies to post videos to an internet website to be viewed by the public. Viewers can also post comments about the videos. Individuals or companies can set up an account on the site and create a “channel” to which only they can post videos.
  Videos about alcohol beverages that are posted to video sharing sites by industry members are considered to be advertisements if they fall within the regulatory definition of advertisement in §§ 4.61, 5.62, and 7.51 as a written or verbal statement, illustration, or depiction that is in, or calculated to induce sales in, interstate or foreign commerce. Therefore, for videos that are considered to be advertisements, all of the regulatory requirements regarding mandatory statements (in §§ 4.62, 5.63, and 7.52) and prohibited practices or statements (in §§ 4.64, 5.65, and 7.54) would apply to both the video and any associated “channel” created by an industry member. As with social network services, there is generally a location on each video sharing site to provide profile information where a viewer would most logically expect to find information about the brand or the company. TTB recommends that mandatory statements be placed there.
  In addition, for videos that are subject to the advertising regulations, the industry member must include the mandatory statements within the videos themselves, if there is no associated “channel” or profile section, or if the industry member allows video content to be downloaded by viewers. By allowing videos that the industry member posts to be downloaded, the industry member is in effect disseminating an advertisement, so each advertisement must contain all of the mandatory statements required by regulation. When the industry member has both a “channel” or profile section and individual videos, TTB recommends placing the mandatory statements on both.
  For videos and video sharing sites that TTB considers to be advertisements, the regulations regarding prohibited practices or statements also apply to any information that the industry member may place on the site.
  
• Blogs. A blog (short for web log) is a type of website intended for public viewing that is maintained by an individual or company and is frequently updated with entries that may include commentary, events, videos, or pictures. Most blogs are interactive and allow visitors to leave comments or messages; it is this interactivity that distinguishes them from static websites.
  If an industry member maintains a blog about itself (e.g., ABC Winery blog) and discusses issues related to the company, its products, or the industry in general, the blog is considered by TTB to be an advertisement and is subject to TTB’s advertising regulations because it is a written statement by the industry member that is calculated to induce sales in interstate or foreign commerce. Accordingly, the mandatory statements prescribed in §§ 4.62, 5.63, and 7.52 must be included in the blog, and the regulations regarding prohibited practices or statements contained in §§ 4.64, 5.65, and 7.54 also apply to anything posted by the industry member on the blog.
  
• Microblogs (e.g., Twitter, Tumblr).A microblog differs from a traditional blog in that posts are typically very short. Microblog posts often include short sentence fragments, images, or links to videos. Commercial microblogs are designed to promote websites, services, or products. If a microblog is determined to be a written statement calculated to induce sales in interstate or foreign commerce, it will be considered to be an advertisement under TTB’s regulations.
  The public can “follow” an industry member’s microblog posts, which will then appear on their own microblog page or be sent to a mobile phone or other device. Many microblog services have character limitations of around 140 characters. Due to these character limitations, TTB has determined that it is impractical to require mandatory statements to appear in every microblog post made by the industry member. However, mandatory statements prescribed in §§ 4.62, 5.63, and 7.52 must appear in the advertisement in a manner that is conspicuous and readily legible. Similar to other social network services described above, industry members may include the mandatory statements on their microblog profile page.
  Character limitations have no effect on the application of the regulations regarding prohibited practices or statements prescribed in §§ 4.64, 5.65, and 7.54; thus, they must be followed for each microblog post.
  
• Mobile Applications.Some industry members are creating applications, also known as “apps,” that can be downloaded to consumers’ mobile phones or other handheld devices. These apps may provide drink recipes, assist consumers with finding locations where a product is served, or provide other information related to an alcohol beverage that the consumer may find of interest. TTB considers mobile apps related to alcohol beverages to be advertisements consistent with §§ 4.61, 5.62, and 7.51 because mobile apps are written or verbal statements, illustrations, or depictions that are in, or calculated to induce sales in, interstate or foreign commerce. Because these apps are downloaded by the consumer to a mobile device, however, TTB considers them to be a consumer specialty advertisement, which is defined at 27 CFR 6.84( b )(2) as, “…items that are designed to be carried away by the consumer, such as trading stamps, nonalcoholic mixers, pouring racks, ash trays, bottle or can openers, cork screws, shopping bags, matches, printed recipes, pamphlets, cards, leaflets, blotters, post cards, pencils, shirts, caps, and visors.” Accordingly, under §§ 4.62©(2), 5.63(e)(2), and 7.52( c )(2), the only mandatory statement required to appear in the app is the company name or the brand name of the product.
  The regulations regarding prohibited practices or statements (in §§ 4.64, 5.65, and 7.54) apply to mobile apps for alcohol beverages that are created by industry members as they would for any other advertisement.
  
• Links and Quick Response CodesIndustry members frequently post links to other websites or pages on their social media advertisements (including social network services, video sharing sites, blogs, microblogs, and mobile applications). In reviewing social media advertisements, TTB will consider the totality of the message presented by the advertisement and any links contained therein to determine if the content of the links will be considered part of the advertisement. In addition, any description of the linked site or page prepared and posted by the industry member that appears on the industry member’s social media advertisement must not violate the regulations concerning prohibited practices or statements because TTB considers the description of the linked site to be part of the industry member’s advertisement. Similarly, TTB considers any description of links included on industry members’ websites to be part of the advertisement.
  An industry member may also provide links to other websites or pages for different alcohol beverages or companies for which it is the responsible advertiser. In that case, TTB would consider the linked website or page as a separate advertisement that must contain all necessary mandatory information and comply with the prohibited practices or statements regulations.
  Industry members may also enable consumers to access content by including a quick response code (or QR Code) on a label or advertisement. Consumers can scan the QR Code with their mobile device to access the additional content. Depending on the type of media that is linked to by the QR Code (such as the industry member’s webpage, mobile application, or blog), the relevant regulations and TTB public guidance documents will apply. If, for example, the QR code links to a document, such as a drink recipe using an industry member’s product, the recipe will be considered an advertisement because it is a written or verbal statement, illustration, or depiction that is in, or calculated to induce sales in interstate or foreign commerce. The regulations regarding prohibited practices or statements (in §§ 4.64, 5.65, and 7.54) also would apply to the additional content obtained by scanning the QR Code as they would for any other advertisement. If questions arise concerning which regulations apply to a particular type of media, industry members may contact TTB at the contact information listed below.
  

5. QUESTIONS.

If you have any questions concerning this circular, please contact the Market Compliance Office by phone at (202) 453-2250 and press option 5, or by e-mail at alfd@ttb.gov.

John J. Manfreda

Administrator

Alcohol and Tobacco Tax and Trade Bureau

[eli]

Posted some thoughts about ways to adapt to TTB's new position on social media: http://bottlesociety.tumblr.com/post/51804232174/regarding-the-may-2013-ttb-industry-circular-on-social Will try and paste below, click link for original post...

regarding the May 2013 TTB industry circular on social media

We are not lawyers. We’re just fans of local distillers and want to help them out as best we can.

We’re still working through the new recommendations from the TTB, and we’ll make more posts about this in the future once we have more info. There’s a chance all photos posted by the distiller will need to include mandatory statements. But in light of that, here are some thoughts on simple changes distillers can make to their social media pages meet recent recommendations made by the TTB (TTB industry circular on social media).

• The TTB is viewing all your social accounts as advertisements. Each of your distillery’s social media accounts needs a Mandatory Statement - what information you need to include in your Mandatory Statements is something you need to determine with your your attorney’s help. If we can get guidance worth sharing on this, we will share!
  
• We recommend adding Mandatory Statements to the Background Graphics of your social channels. When there is room for text in the Profile of the social network, add it there too. Twitter limits the length of text, so our solution is a good workaround to staying compliant.
  
• FACEBOOK: To add Mandatory Statement to Facebook, we recommend adding it to two place -1) your cover photo, 2) your About section. Here’s how it would look in the cover photo - it’s that tiny line of copy at the bottom-center of the cover photo (mockup of Koval Distillery’s Facebook page):For the About Section: You should have a Description field you can add to in your about page. To edit the About section, go to your distillery Facebook page, click EDIT PAGE at the top of the screen, and select EDIT BASIC INFO (this can also be found at facebook.com/your-facebook-page/info). We’d recommend including the statement somewhere that doesn’t require the User to click MORE if they’re on the About/Info page already. Photo below (mockup from Koval Distillery’s Facebook page):
  
• YOUTUBE: To add Mandatory Statement to YouTube we’d recommend using the Background Graphic/Art. You can also add it to the Info and Settings section of your channel (in the Description field), but YouTube doesn’t always display this info and sometimes there aren’t even fields for it. Here’s how it would look in Youtube as part of the art (mockup from Koval Distillery’s YouTube page): In otherwords, before you upload a custom image file to make your YouTube channel looks the way you want, you’d need to add some text into the image and output a new file that you’d then upload to YouTube. You might need to try a few different ones before you get the text to look right on the channel page. We’ve seen some larger brands place it bottom center so if the user scrolls down at the Channel page the info is in the middle of the screen.
  
• TWITTER: To add Mandatory Statement to Twitter you can use the background image technique like for YouTube. We think squeezing as much as you can into Twitter’s Bio field - found if you click Edit Profile (https://twitter.com/settings/profile) - isn’t going to work for everyone. You’re only allowed 160 characters. You could use this Bio field to include something like “for more info click here” where you include a link to a page on your website that has the mandatory info. We think background image is the best option for Twitter, but again, we’re not lawyers. Here’s an example (again mocked up from Koval Distillery’s Twitter page):
  

That’s all we have for now. Let us know if you have thoughts or questions or ideas. We hope it helps some of you.

[bluestar]

That's great, although the pictures in your post are too small to read the text you added to the Koval examples.

I think what would be great is if someone posted a copy of the required disclaimers already in place on one of the web sites, if someone has done so.

But from what I can see, Koval already has the required information even without adding the lines you suggest. See me next posting.

But thanks. If we can get our page correct soon, we will point you all to it.

[bluestar]

By the way, this is what the CFR refers to for mandatory statements for distillers if the pages are NOT product specific:

If an advertisement refers to a general distilled spirits line or all of the distilled spirits products of one company, whether by the company name or by the brand name common to all the distilled spirits in the line, the only mandatory information necessary is the name and address of the responsible advertiser. This exception does not apply where only one type of distilled spirits is marketed under the specific brand name advertised.

So, if read correctly, the only mandatory information is the company name and address, and this usually only requires city, state, maybe zip?

Since most people put the full name and address of the company on the profile page, this should cover the requirement?

For example, in our Facebook page, the company name is on the page name on the front page, and the company address is below our logo near the name. If you go to the About box, our name and address are part of the map application, and we also state we are in our town and state.

Generally, this info is requested in completing any Facebook page, so most people who properly complete all possible info for the page should be compliant, correct?

However, where it gets less clear would be when you make posts or pictures or other information that is specific to a particular product. Then the additional mandatory information for a product might kick in?

[eli]

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[bluestar]

Yes, those make sense. But I was a bit confused about what if your site or page lists all of your line of products. My reading is you don't need the individual info for that content. But if the descriptions for products extend, or have ability to be displayed as individual subpages or pop ups, those might well?