March 26, 2012Newsletter

Social Media Promotion of Food and Beverages: Reap the Rewards While Avoiding the Pitfalls

Agribusiness, Food and Beverage Newsletter

Facebook, Twitter, and other social media sites are becoming standard tools for food and beverage companies to market their products and communicate with their customers.  Social media sites can be powerful tools for companies to promote their brands, provide word-of-mouth marketing, and allowing direct communication between the company and its customers. While social media sites provide many potential benefits, they also come with associated risks that companies should be prepared to identify and manage.


The first thing a company should be aware of is to make sure its specific social media pages are compliant with the terms of use and privacy policies of the social media providers that govern the use of the site. Terms of use for social media sites can vary significantly among sites and may include important restrictions.


Companies should pay special attention to terms relating to any prohibitions a social media site has on advertising, marketing and promotions or other commercial purposes. For instance, while YouTube's terms of service are generally silent on the issue of sweepstakes and promotions, Facebook's terms of service prohibit offering contests, giveaways or sweepstakes on Facebook without its prior written consent. Even those who merely use Facebook to publicize a promotion that is otherwise administered and conducted entirely off of Facebook must comply with its Promotions Guidelines. 


Additionally, companies should be aware of legal responsibilities assumed with the use of a site, (such as complying with “takedown” provisions of the Digital Millennium Copyright Act). Many social networking sites prohibit the uploading or posting of content by any user that infringes a third party's rights, including intellectual property privacy and publicity rights. If intellectual property rights of a third party are infringed, often a “takedown” notice will be provided.  In practice, the third-party social media site owner usually bears the responsibility for responding to these notices, but the company should be aware of the possible infringing content being posted in association with the company’s social media page. 


The company should be aware of the age restrictions of users of the social media pages, and plan their marketing and promotions on the social media pages appropriately. The terms of service applicable to Facebook and YouTube specifically prohibit use by children under the age of 13, while Twitter allows access only by individuals who can enter into a binding contract with Twitter. Again, while the third-party social media site owner usually bears the responsibility for establishing age limits for users, companies should plan their marketing activities on the sites for the age-appropriate users.


Companies also need to comply with each site's privacy policies, which can also vary significantly among sites. They should ensure that the site owner's privacy practices for any data disclosed by the company or collected by the company from users of the site are appropriate and sufficient for the company's intended use of the site.


Another pitfall to be aware of are testimonials and endorsements a company may use or post on their social media site. The Federal Trade Commission has indicated that companies are subject to liability for failing to make material disclosures relating to any endorsement relationship between an endorser or testimonial and the company. Therefore, if the endorsements or testimonials on a social website are in some way controlled or sponsored by the company this relationship needs to be disclosed. 


Another area in social media that companies must be vigilant of is the social media activities of the employees of the company. Apart from simple efficiency losses due to personal use of social media by employees during work hours, companies should be vigilant about possible leaks of confidential or proprietary information by their employees about company practices, policies and plans on these websites. 


Companies should also be aware of how third parties comment on their food and beverage brands on social media pages that are not controlled by the company. Infringing use of the company’s intellectual property, or misleading, inaccurate or defamatory statements regarding the company and its brands may occur in the social media content of others.  A company should have monitoring and response policies to identify and respond to infringing, inaccurate or defamatory statements that are made concerning a companies branded food and beverage products. 


A helpful tool for companies to manage their usage of social media is to develop a social media policy for the business. The social media policy should establish clear, written terms of use and privacy policies for all social media sites, services and applications the company offers.  Some common provisions such a policy should have is:

  • Guidelines on how and what type of material the company should distribute on the different social media sites.  
  • Monitoring protocols for the social media sites of a company to make sure that the sites are compliance with the terms and conditions of the site providers.
  • Monitoring and action protocols for dealing with third party social media posts with respect to the company and it’s brands that my be infringing, inaccurate or defamatory.
  • Employee social media use policies in relation to company information to protect against the inadvertent release of confidential information


By developing a social media policy a company can manage and avoid all the pitfalls associated with social media activities.

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