Affiliate Links Aren’t Disclosed – Marketers Can Help Solve the Problem

Many YouTube and Pinterest posts include affiliate links. Content publishers receive a commission when website visitors click on an affiliate link and purchase a product. Win-win, right?

Here’s the problem: The Federal Trade Commission (FTC) places affiliate marketing in the same category as paid advertising and endorsements. The link affiliation must be disclosed. An overwhelming majority of affiliate posts on YouTube and Pinterest lack disclosures, new research from Princeton University reveals. In addition, most disclosures don’t follow FTC guidelines.

Princeton University researchers Arunesh Mathur, Arvind Narayanan, and Marshini Chetty found that 3,472 of 515,999 YouTube videos and 18,237 of 2,140,462 Pinterest pins contained at least one affiliate URL. Only 10.49 percent of videos with affiliate links and 7.03 percent of all affiliate pins contained disclosures.

The Most Common Type of Disclosure is Insufficient

The research reveals that affiliate link disclosures are the most common type of disclosure. YouTube publishers state that affiliate links appear in the content; Pinterest affiliates include “aff link,” “affiliate” or similar shorthand on the pin.

But FTC guidelines say simply labeling links “affiliate” is insufficient. Consumers might not understand what affiliate link means.

In another type of disclosure, some YouTube publishers say users can “support” their channel by clicking the links, but don’t explain what that means.

Explanation disclosures — the kind the FTC recommends — only appear in 1.82 percent and 2.43 percent of affiliate content on YouTube and Pinterest, respectively. Those disclosures offer more long-winded explanations about affiliate marketing and affiliate URLs and reveal that the publisher collects fees from the links.

“Clearly and Conspicuously”

FTC guidelines require content creators to disclose their relationship to the retailer “clearly and conspicuously.” The agency suggests stating next to the link: “I get commissions for purchases made through links in this post.” Placing disclosures in obscure places – for example, buried on an about us or general info page, behind a poorly labeled hyperlink or in a “terms of service” agreement – is inadequate, it says.

Disclosures are especially important since affiliate content tends to garner higher engagement, according to Princeton researchers. That means it’s more likely to appear before users in results from keyword searches and networks’ general recommendations.

Researchers said they’re not sure if affiliates are unaware of the need to disclose or are unaware of the FTC’s specific guidelines. Limited space on social media presents a hurdle. Description length can be as long as 5000 characters on YouTube, but only 500 characters on Pinterest.

Social media platforms could help if they designed interfaces to make it easier for affiliates to disclose without crowding their text. Instagram recently added an option for sponsored content to be disclosed with its paid partnership tool. YouTube added the ability to create a Contains Product Placement overlay to their videos.

“Such disclosure tools are a step in the right direction, however it is unlikely that such blanket disclosures will cover all marketing strategies,” the paper states.

Time to Hold Affiliates Accountable

Affiliate marketing companies could hold their affiliates accountable to better practices, they say. Many leading affiliate marketing companies don’t publish terms and conditions for their affiliates, at least none that are publically available.

Out of eight major companies examined, only Amazon and ShopStyle explicitly reference  FTC guidelines in their affiliate terms. Impact Radius and RewardStyle lack publically available terms. Rakuten Marketing and ShareASale lack publically available terms but mentioned the need for disclosures in blog posts.

Affiliate marketing companies could also examine how to reward affiliates who adequately disclose and penalize those who don’t.

Web browsers could help increase transparency through in-built support or add-ons and extensions, researchers say, adding that they’re working on such a project.

Bottom Line: Most affiliate links on YouTube and Pinterest lack disclosures. Those that include disclosures often don’t follow FTC guidelines. Consumers cannot reach informed decisions if they don’t know the publisher earns a fee when they click on the links. Marketers can play an instrumental role in improving disclosures by holding their affiliates accountable.