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MoreNiche operates an affiliate marketing network which enables
affiliate marketing businesses on that network to promote products
offered by product merchant businesses. An affiliate which promotes
the product of a MoreNiche merchant will, along with MoreNiche,
earn money when a consumer clicks through from the affiliate's
website to the merchant's website to make a purchase.
MoreNiche's online network has 30 product merchant businesses
and over 149,000 affiliate marketing businesses worldwide.
The OFT was concerned that, in breach of the Consumer Protection
from Unfair Trading Regulations 2008, reviews and product
endorsements running on some affiliate's websites were
presented as independent consumer reviews when they were actually
commercial promotions. The OFT believe that consumers are more
likely to be influenced to buy products having read apparently
unbiased reviews rather than reviews which were in fact clearly a
form of advertising. The OFT took the view that the practices of
affiliate websites amounted to:
misleading omissions under the Regulations as they did not
disclose material information or provided information in a manner
that was unclear, unintelligible, ambiguous or untimely and
unfair commercial practices as the editorial content did not
make it clear that the promotion had been paid for and they
involved falsely claiming or creating the impression that the
affiliate was not acting for purposes relating to its trade or
business.
MoreNiche cooperated with the OFT and signed undertakings to
comply with the law. The undertakings require MoreNiche, as the
operator of an affiliate network, take sufficient steps within an
agreed timescale to ensure that affiliates within the MoreNiche
network do not continue or repeat the prohibited conduct, which is
defined as failing to take sufficient steps which are reasonably
practicable to ensure that affiliates do not engage in unlawful
commercial practice. There is an annex with examples of
"reasonably practical 'sufficient steps'".
MoreNiche agreed to dates by which to have completed manual reviews
of top UK and non-UK affiliates and, later, all affiliates. It has
to have, by September 2012, systems proactively to spot check 50%
of its sales generating affiliates each year.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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