On April 1, 2015, I stood before a packed room of distillers at the American Distilling Institute’s (“ADI”) annual conference in Louisville, Kentucky to deliver the message that there is a right, effective and compliant way to do state of the art social media marketing. The best and brightest distilled spirits newcomers and craft favorites are members of ADI and over 1500 were at the national conference. While every one of them recognized the importance of social media, the legalities and best practices for using social media are a mystery to many. For those of you who couldn’t be there, here are some highlights and takeaways:
1. Which laws apply to social media?
Alcohol advertising is regulated by the federal regulators (TTB, FDA) and state ABC agencies, meaning there is dual jurisdiction and the potential for cross-violations from federal and state agencies. There are no general rules, every state is different, and if an advertising or marketing practice is not specifically permitted, it’s often prohibited. If it is permitted, it must follow both state and federal laws, rules and guidelines. When marketing on social media and online, brands should tailor national advertising compliance to the most restrictive states, and event advertising is state-specific so each market needs to be reviewed for compliance before activation of event programs.
The TTB has released guidance on social media advertising here, and social media posts sponsored or conducted by brand accounts and those representing brands must comply with the federal advertising requirements in 27 CFR Parts 4, 5 and 7. The FTC also published a study on alcohol advertising, available here.
There has been limited state guidance regarding the use of social media. Some states, like California and Illinois, have addressed social media advertising as a potential thing of value to retailers when posts mention a specific retailer and have filed accusations against supplier licensees in these cases. Bills are proposed in both states, which, if they pass, would provide a social media exception to the tied house laws and permit this practice going forward. This state interpretation contrasts with states like Texas that have explicitly permitted retailer locators in social media. Other states, like Washington and Oregon, permit social media as long as it does not appeal to or solicit viewers under 21 and as long as it complies with other laws (like Oregon’s Happy Hour restrictions). Still other states, like Kentucky and North Carolina, permit social media advertising without additional guidance, and many more states provide no guidance about social media at all but fall back on the federal government’s regulations.
For still more information on social media, check the material from your relevant industry association, DISCUS, Wine Institute and Beer Institute for their social media and marketing guidelines.
2. What is the biggest social media trap to avoid?
- Be cautious of advertising events involving retailers, like the now infamous California accusations against suppliers who advertised the Save Mart Grape Escape in Sacramento, a charity event that did not take place at Save Mart, but was sponsored by them.
- There are specific state exceptions that permit you to advertise events you are attending at retail accounts – such as wine tastings and bottlesignings in California. Every state is different though, so you want to understand what events you can and can’t advertise in every market.
- Federal law and some state laws permit advertising two or more unaffiliated retailers (retailer locators), but the specific information you can share varies. Some states, for example, don’t permit names, only addresses, where your product can be found. Here’s a good example of how to do a post with multiple retailers listed without any images or extra advertising material that is not permitted in many markets: