Watchdog Calls on FTC to Investigate Tremor

Public watchdogs just won’t leave the buzz marketers alone. Just as its two previous brushes with bad publicity had begun to fade from memory, this growing marketing subset may be in for another PR headache.

The consumer advocacy group Commercial Alert has made public a letter addressed to the Federal Trade Commission urging it to investigate Procter & Gamble’s Tremor unit, BzzAgent and other companies that recruit individuals for word of mouth marketing campaigns.

The thoroughly footnoted letter details a number of recent incidents of buzz marketing that it argues “might violate federal prohibitions against unfair or deceptive acts and practices affecting commerce.” Among the cases it cites is a report in Forbes that said teens recruited by P&G’s Tremor unit were compensated with coupons and product samples, and that the company doesn’t tell those teens to disclose those payments. The letter ends by urging the FTC to issue subpoenas to executives at Tremor in order “to determine whether their endorsers are disclosing that they are paid marketers.”

“We are asking the Federal Trade Commission to investigate that shills are not disclosing that they are shills,” said Gary Ruskin, executive director of Commercial Alert. “We’ve done some deceptive advertising complaints with FTC, and have talked with many audiences over the years about the deception involved in buzz marketing.”

Tremor declined to comment specifically on the letter, but denied that its handouts to teens in its network amounts to compensation for talking up a product.

“Tremor is very transparent in letting our volunteers and tremor teens know that Tremor is part of Procter & Gamble,” said Tremor spokesperson Robyn Schroeder. “Regardless of the teen’s opinion, positive or negative, they are not encouraged to endorse a product. We do not compensate them in any way for talking about a product.”

A spokesperson for the FTC said the agency hadn’t received the letter.

“When we have the letter, we’ll review it,” she said. “That’s all I can say, except that all FTC investigations are private.”

Commercial Alert’s work focuses on fighting against the growing commercialization of culture.