FTC OKs Final Consent Order Barring Lord & Taylor From Deceptive Native Online Ads

Lord & Taylor will be barred under a final consent order from deceiving customers about any paid online articles and Instagram posts passed off as independent or objective, the FTC said in a Monday news release. The commission's 3-0 approval of the final order, following a public comment period, comes after a settlement was announced in March with the national retailer that faced commission allegations for failing to publicly disclose paid native online advertisements and other endorsements. The commission alleged Lord & Taylor edited and placed a paid article in online pop culture and fashion publication called Nylon in March 2015 without telling consumers it was an ad. The publication also posted a photo of a dress from the retailer's private-label Design Lab collection on Instagram, also without saying it was a paid promotion, the commission said. During the same time, the retailer gave 50 select fashion "influencers" a free dress from the collection and paid them between $1,000 and $4,000 each to post a photo of it on Instagram or another social media website without disclosing the payments, said the FTC's prior news release about the settlement. The commission issued policy and guidance in December aimed at protecting consumers from intentionally misleading native online ads, which several industry representatives said was a precursor to enforcement actions against potential violators (see 1512290010). Lord & Taylor said in an emailed statement it "never sought to deceive" customers. "In the FTC's consent order, there is no finding of wrongdoing whatsoever," it added. "A year ago, when it came to our attention that there were potential issues with how the influencers posted about a dress in this campaign, we took immediate action with the social media agencies that were supporting us on it to ensure that clear disclosures were made." The retailer said it has cooperated fully with FTC's investigation and will uphold the commission's guidelines, including educating its teams and ensuring that outside agencies and partners follow them, too.