How a Retail Business Hired a Lawyer to Draft an Advertising Agreement in New York

Navigating the legal side of advertising is complex, nuanced, and easy to misstep if you’re not paying close attention. Most small business owners don’t realize how many rules apply until they find themselves out of compliance. The Federal Trade Commission (FTC) leads the charge, but there are also email marketing laws, state privacy regulations, and product-specific requirements you need to stay aware of. Start With Truth-in-Advertising Every claim you make needs to be true and backed up. That sounds simple, but it goes deeper than avoiding outright lies. The FTC cares about the overall message your ad sends. For example, if you call your jewelry “hypoallergenic,” you need scientific proof. If you say your candle burns for 40 hours, you should have tested it to confirm that. Even more subtle claims like “professional quality” or “restaurant-grade” set certain expectations. If a typical customer sees your ad and walks away with the wrong idea, even if you didn’t mean to mislead them, that’s still a problem. What you leave out matters too. Omitting key details can make a technically accurate statement deceptive. Disclosures Aren’t Optional Disclosures have to be clear and easy to find. That means they need to appear right next to the claim they’re explaining. Burying them in a terms of service page won’t cut it. On mobile, this gets tricky because space is limited, but the rule still applies. Online, the disclosure needs to be visible without scrolling or clicking. On platforms like Instagram Stories, that means overlaying it directly on the image. For videos, include both visual and spoken disclosures since some users will watch with the sound off. Endorsements and Influencer Content If someone promotes your product in exchange for anything of value, you’re in endorsement territory. That could be cash, free products, or even perks. The promoter needs to clearly say what the relationship is. Phrases like “paid partnership,” “gifted,” or just plain “#ad” work. Vague tags like “collab” or “thanks” don’t. It doesn’t matter if the connection feels obvious. If your sister posts about your products and her audience wouldn’t automatically know you’re related, she still needs to disclose that. The FTC has gone after both brands and individuals for not doing this properly, and the fines aren’t small. Managing Reviews and Testimonials The FTC’s new 2024 rules raised the bar. You can’t buy fake reviews, cherry-pick only the good ones, or hide bad feedback. You also can’t post employee reviews without making that relationship clear. If you offer a discount or freebie in exchange for a review, that has to be disclosed with the review itself. Not just during the collection process. If someone got a product for free and later posts a review, even if you didn’t ask for one, that connection still needs to be mentioned. Email Marketing: Know the Basics The CAN-SPAM Act applies to every promotional email you send. That includes messages to current customers. Your "from" line must reflect who you really are. Your subject line can’t be misleading. Every email must include your physical address and a clear way to unsubscribe. If someone opts out, you have ten business days to remove them. You can’t charge a fee to process the request. You’re also on the hook for what your email service provider does on your behalf. Don’t Ignore State Privacy Laws More states are passing privacy laws that affect how you handle customer data. California’s law kicks in if you hit certain thresholds like $25 million in annual revenue, data on 100,000 residents, or making half your income from selling personal data. Other states like Virginia, Colorado, and Connecticut have similar laws with different cutoffs. These usually require a privacy policy, give consumers control over their data, and include opt-out tools for targeted ads. If you’re advertising on platforms like Facebook or Google, you might need to adjust your settings based on where your audience lives. Know the Rules for Your Products Depending on what you sell, you may need to comply with additional regulations. Products for children must follow strict safety testing and certification rules. Textiles need labels showing fiber content. Some products need to list the country of origin. If you sell personal care items like soaps or cosmetics, FDA labeling rules apply. Food products have their own set of requirements. Even jewelry can trigger rules if it includes certain materials or makes any kind of health-related claim. Platform-Specific Limitations Every advertising platform has quirks that affect compliance. Twitter’s short character limits can make it tough to include disclosures. TikTok moves fast, so it’s easy for important info to get lost. Instagram limits where and how you can add links or overlay text. The key is to make sure your disclosures actually show up within the format you’re using. If you can’t do that, either adjust your claims or switch platforms. One size doesn’t fit all here. How to Put It All Into Practice Start by reviewing every claim in your ads. For each one, ask: Can I back this up? If not, either get the evidence or change the claim. Make sure your disclosures are easy to find and understand across every platform you use. If you work with influencers, update your contracts to include disclosure rules and check their posts regularly. For reviews, set up a process that keeps things authentic and legal. Go through your email marketing setup and confirm it matches CAN-SPAM rules. Look into privacy requirements even if you don’t think they apply to you yet. The laws are changing quickly, and it’s better to be prepared. As your business grows, the legal risks grow with it. These rules form a solid starting point, but once your marketing gets more complex, it’s smart to consult an attorney who specializes in advertising law. A little proactive work now can save you from expensive problems later.