Affiliate links have long been a way for website owners to earn money from their pages. A regular advertisement is an endorsement for a product that’s obvious to everyone. Even a link can be framed as an advertisement with the right wording. Affiliate links on the other hand, are different. The site owner doesn’t get paid for a certain number of views. Neither do they get paid when a user clicks on them. Instead, the payment happens when someone makes a purchase through the link via a tracking code.
Unlike advertisements, affiliate links need not endorse the product they’re selling. For example, a site could merely be a “price comparison web page with links to different types of products. The site owner doesn’t claim that one product is better than the other. Only that the links leading out imply a financial relationship between the website and the product.
FTC Disclosure Requirements
In 2009, the FTC decided to lightly regulate this business model. They wanted to make sure that users knew about the financial relationship of the site to the products that they link to. In a release to that effect, the FTC mandated that all affiliate links must be clearly disclosed as such.
However, they left it to the discretion of the site owners how this is to be implemented. There was only one guideline – the consumer should be aware of what was happening. Whether it’s a site wide notice, or an individual notice for each affiliate link, the FTC didn’t specify the exact details of how this was going to happen.
While affiliate links are not explicitly mentioned as such in the FTC guidelines, they later released a bunch of clarifications in which they address the issue. In this, they talk about conspicuous messaging and disclosure of affiliate links.