By: Brian D. Kaider, Esq.
Members of the alcoholic beverage industry should be aware that TTB regulations require certain mandatory information and prohibit some practices and statements in all advertising of alcoholic products and brands. But, what constitutes advertising may be broader than some members realize. Specifically, how the rules apply to the expanding realm of social media may be a bit of a surprise.
What is an Advertisement?
“Advertisement,” as defined in 27 CFR Parts 4, 5, and 7, for wine, spirits, and malt beverages, respectively, includes any verbal statement, illustration, or depiction that is in, or calculated to induce sales in, interstate or foreign commerce, or is disseminated by mail. The regulations further provide that the requirements for such advertisements apply regardless of the means of dissemination. Some of the specific examples listed in the regulations include: radio or television broadcast, newspaper, periodical, publication, sign, menu, book insert, or by electronic or internet media. The TTB considers “electronic or internet media” to include all forms of social media.
Required Information
All advertisements must include the responsible advertiser’s name and either its city and state or other contact information, such as a telephone number, website, or email address. If the advertisement refers to a general line of products (beer, wine, or spirits) or all of the products by the company or brand name, then no more information is required. If the advertisement refers to a specific product, however, then it must also include a conspicuous statement of the class, type, or distinctive designation to which the product belongs. This statement must match what is on the product label. For example, if the product is labeled as a “Rum with natural flavors,” an ad that identifies the product only as “Rum” would be non-compliant. Further, in the case of distilled spirits, the ad must also include a statement of alcohol content and, if applicable, the percentage of neutral spirits and the name of the commodity from which such spirits were distilled.
Prohibited Practices
The list of prohibited practices in the advertising of alcoholic products is too long to be inclusively presented here. However, as a generalization, an advertisement cannot: be false or misleading in any respect; be inconsistent with the product label; contain inappropriate health-related statements; or contain representations, flags, or symbols that give the impression of endorsement or sponsorship of the armed forces or any government.
Applicability to Online Media
Most breweries, wineries, and distilleries have a website to advertise their products and/or overall brand. The TTB views a website and all of its subpages collectively as a single advertisement. The required information, therefore, only has to appear in one part of the website to be compliant. The information, however, cannot be hidden; it must be conspicuous, readily legible, and apparent to persons viewing the advertisement. While the TTB does not require a specific location on the website, it recommends that information be presented in the place consumers would typically expect. For example, name and contact information is typically found in the “about,” “profile,” or “contact us” section. Class, type, and alcohol content for specific products would be expected to be found on the “shop” or “products” page. One potential problem occurs with mobile versions of websites. They are often structured differently from their desktop counterparts and are, therefore, considered a separate advertisement and must independently be compliant with the regulations.
Social Networks and Media Sharing Sites
Social Network Services, such as Facebook and LinkedIn are treated very similarly to websites. Viewed as a whole, they commonly contain required name and contact information on a main page or “about” section. In that case, individual posts may not have to contain the mandatory information. There are exceptions for shareable content, however, as discussed below for Media Sharing Sites.
Media Sharing Sites, such as Instagram, YouTube, Pinterest, Instagram, etc., allow companies to share photographs, videos, gifs. As with websites and social network services, the TTB views a company’s media sharing site as a single advertisement. So, if the profile or about section of the site contains the required information, the company is generally compliant. However, if the posted media content can be downloaded or shared by viewers, it is considered to have been disseminated by the advertiser and the content stands on its own as a separate advertisement. So, for example, if a brewery posts a video introducing a new product and that video can be downloaded or shared by viewers, the video itself must contain all of the mandatory information.
Blogs and Microblogs
Blogs allow a company to post stories, commentaries, images, videos and other content. They are commonly included in a section of the company’s website and, if so, may rely on the mandatory information presented elsewhere on the website. If the blog stands alone, separate from the website, or is electronically disseminated, then it is a separate advertisement and must independently be compliant. Microblogs, such as Twitter and Tumblr, are different because they have a maximum character number that makes each post very short. Because of these limitations, the TTB recognizes that the mandatory information cannot be included in each post. Instead, to be compliant, the advertiser must provide the information either on their microblog profile page or use a descriptive link that directs the viewer to a separate webpage containing the information.
Outside Links
Advertisers will often include links and QR codes that direct viewers to sites outside of the original advertisement. Similarly, a product label may allow viewers to access an augmented reality video or image. So long as such outside content is only accessible using the product label or other advertisement that already contains the mandatory information, nothing else is required. Otherwise, the content would have to be independently compliant.
Social Media Influencers
Building a large following on social media can be difficult, especially for small, local businesses. To broaden the scope of brand awareness, some turn to others who already have a large following to help promote their products. These social media influencers may post content created by the company or may create their own content on the company’s behalf. If the TTB determines that the post was published or caused to be published by the company or that the company compensated the influencer for publishing the content, it will be treated as an advertisement by the company and it must be compliant with TTB regulations. The mandatory information may be provided through a clearly marked link to the company’s website, for example.
Beware the “Like” Button
One of the benefits of social media is that the user does not have to create all its own content. Posts created by others can be shared or “liked” by a company, which allows that content to be viewed on the company’s own page. Doing so helps to build a following as a third-party whose content is shared is more likely to reciprocate, broadening the reach of company’s own content. However, because shared or liked content then appears in the company’s feed, it becomes a part of the company’s advertisement and must, therefore, be compliant. This is typically not a problem with regard to the mandatory information, because that is already included in the company’s profile. However, the shared content must also not include any prohibited practices. For example, if a distillery comes out with a new product that is a “rum with natural flavors,” and they share or like a user’s post in which they refer to the product only as a “rum,” they could be viewed as being noncompliant, because the ad is inconsistent with the product label.
Conclusion
The rules for advertising an alcoholic product or brand on social media really are not any different from the rules for advertising in more traditional media. Issues may arise, however, because social media enables new and different ways of presenting information and it may not always be obvious that they are advertisements. Further, because of the ease of disseminating content, it can become detached from its original source, which would take it out of compliance if it does not contain the mandatory information. Having an attorney periodically review social media content and/or train marketing staff may help to avoid compliance issues.
The information presented in this article is based upon TTB Industry Circular 2022-2 and the regulations contained in 27 CFR §§4.60-65, 5.231-236, and 7.231-236. Review of those materials is recommended.
Brian Kaider is the principal of KaiderLaw, a law firm with extensive experience in the craft beverage industry. He has represented clients from the smallest of start-up breweries to Fortune 500 corporations in the navigation of licensing and regulatory requirements, drafting and negotiating contracts, prosecuting trademark and patent applications, and complex commercial litigation.
