Buzz marketing hits brick wall

TV commercials, radio jingles and outdoor advertising are all heavily scrutinised under the self-regulation code of practice, leaving marketers no choice but to resort to stealth advertising techniques when trying to reach out to the YouTube generation. But, with increasing calls to toughen advertising regulations, especially the “untraditional” online channels, the death of buzz marketing looms large.

A new consumer protection regulation, called the Consumer Protection from Unfair Trading 2008, is set to change the face of buzz marketing forever, and heralds the demise of certain stealth techniques used by the discipline.

The regulations were introduced by the Department for Business Enterprise and Regulatory Reform as part of its work to integrate the European Commission’s Unfair Commercial Practices Directive 2005 into UK law. The voluntary Advertising Standards Authority is still in place, but now persistent offenders could face investigation by the Office of Fair Trading.

The memorable “All I want for Xmas is a PSP” fake blog, created as a campaign to promote the Sony PSP games console in 2006, for instance, will no longer be allowed. Even at the time it caused a huge consumer backlash when it was revealed as fake. Blogs such as Coca-Cola’s “The Zero Movement” (created in Australia and later revealed as a work of the soft drinks company itself), or the one called Wal-Marting Across America (apparently produced by two ordinary citizens on a road trip visiting Wal-Mart stores, but which turned out to have been sponsored by the retailer) will be banned.

Buzz marketing is the practice of creating a buzz about a brand. It uses untraditional channels, such as blogs, online postings, word-of-mouth marketing or even setting up pop groups. Ad agency Saatchi & Saatchi launched a manufactured girl band in 2006 called HoneyShot, which was for sale to any company that wanted to brand them. Radio 1 pulled the band’s single after it was discovered they were on the payroll of hair products company Shockwaves. Under the new regulations, which comes into force on May 26, the person responsible for creating this could potentially face criminal proceedings.

The new rules are designed to clamp down on sharp practice and aggressive selling tactics, but experts say it will have a significant impact on reputable businesses and buzz marketing firms.

Osborne Clarke head of marketing and privacy law Stephen Groom thinks the new regulations are the “biggest shake-up in the UK laws affecting marketing and advertising ever.”

“For the first time, all the rules are being… pooled into an umbrella of rules focusing on unfair commercial practice,” he says. He adds that the regulations could create more complex issues for marketers: “Not just fringe merchants, but mainstream legitimate marketers. They might get caught offside if they do not pay attention to this. This will have quite an impact on a very hot, popular and growing area of the market.”

The new regulations will make seeding positive messages about a brand in a blog – without making it clear that the message has been created by or on behalf of a brand – illegal. The regulations also outlaw the use of buzz marketing specialists to communicate with potential consumers in social situations, without disclosing that they are acting as brand ambassadors. Seeding internet virals in a manner that implies you are a member of the public will also be banned.

The practice of astroturfing, where a blogger writes on behalf of a commercial entity without making that clear, will be made illegal.

In 2005, a blogger posting about his estranged father received a comment from someone called Barry Scott, saying he had not seen his father for a long time either, and to drop him a line if he could help. It emerged that Barry Scott was not a real person, but a marketing vehicle for cleaning brand Cillit Bang, and his weblog was a disguised viral marketing platform for the product.

Other forms of buzz marketing, such as word-of-mouth marketing, will also be covered by the regulations. Taxi Promotions UK uses London cabbies for marketing. For example, it might send a cabbie on holiday to Thailand, courtesy of the Tourism Authority of Thailand, in the hope that he will discuss the trip with his customers. Drivers are not required to talk about the trip, although it is implied by branding on the black cab and messages on the seats recommending you to “ask your driver about Thailand”.

Taxi Promotions UK managing director Asher Moses is confident that his services comply with the law. “There is no sales pitch and no financial transaction,” he says. “The driver does not get paid. But we will check we aren’t crossing any borders.” Moses says the driver always makes it clear that he or she was taken on the trip by a commercial company.

Currently unfair or misleading ads are policed by self-regulatory body the ASA, which has limited powers. Under the new rules, the same practices could see advertisers facing fines of up to £5,000. Managers could also be found personally liable for offences under the new rules, and in serious cases face a custodial sentence.

However, Hyperlaunch head of buzz marketing Simon Quanse says the new regulations will only have the potential to affect those using “underhand” buzz marketing techniques.

“There are some agencies that do not have the maturity, openness and respectfulness to engage with people in the right way,” says Quanse. “As a result, the whole industry suffers.”

Justin Kirby, managing director of consultancy DMC and co-founder of the defunct Viral and Buzz Marketing Association, says it is difficult to define buzz marketing, and the new regulations open up grey areas. “If I sign up to a consumer panel and talk about a brand, am I a brand ambassador?”

Institute of Practitioners in Advertising legal director Marina Palomba says the new regulations will ensure integrity for buzz marketing. “You can’t hold yourself to be a consumer when you are not,” she points out. “The Web has been a bit of a Wild West, and to maintain integrity we need to be more respectful.”

Incorporated Society of British Advertisers policy director Ian Twinn says that buzz marketing companies need to be careful: “From the advertising point of view, they will now have to be very transparent in what they are doing.”

Although the new regulations set out to introduce an element of honesty and clarity to the murkier aspects of the discipline, it might just destroy buzz marketing as we know it