Stay Legal, Go Viral: Digital Marketing Without Breaking Alcohol Laws (Or Any Law)

Navigating the Digital Frontier in Alcohol Sales: A Guide for Enterprise Ecommerce Managers

Navigating the digital marketing landscape for alcohol brands requires a delicate balance between innovative engagement and stringent compliance. Let's dive into how AccelPay empowers enterprise liquor companies to thrive online, while adhering to the intricate web of regulations.

Digital Engagement: Beyond the Bottle

Contrary to popular belief, the digital era hasn't opened the doors for alcohol suppliers to sell directly to consumers. Regulatory frameworks, with a few exceptions like DTC winery laws, maintain strict boundaries. However, the real game-changer has been the digital empowerment for suppliers to advertise and engage with consumers in ways previously unimaginable.

In physical stores, retailers hold the reins on advertising and product placements. Digital platforms, however, offer a new frontier where suppliers can shine, allowing brands to connect with high-intent consumers through targeted ads and content, setting the stage for a click-through to licensed retailers.

So, having set the stage for the significance of compliance in the digital marketing landscape for alcohol brands, let's delve into a few channels that often leave digital marketers scratching their heads, wondering how to navigate without running afoul of alcohol regulations. From influencer partnerships to the intricacies of email and SMS marketing, there's a myriad of considerations that can make or break your strategy. We'll break down what you need to keep in mind for these activities, ensuring you're informed and prepared to engage with your audience confidently and legally.

Influencer Marketing

When brands work with influencers they should be mindful of the large amount of guidance the FTC has published in this area.  The FTC has broad jurisdiction to protect the public from deceptive advertising so first and foremost brands must be mindful of what is deceptive.

According to the FTC, failure to disclose that an influencer has received something of value from a brand is deceptive. So first and foremost, all influencers, no matter what type of media, blogs, social media, podcasts etc who have received something of value from a brand must disclose that relationship when blogging, using social media etc.

So what qualifies of “something of value” that requires disclosure?

Guidance from the FTC goes beyond payments, or complimentary items in exchange for a review or mention.  Per the FTC, disclosure is required when you are given “free or discounted products or other perks … even if you weren’t asked to mention that product”.

Guidance from the FTC on how to make this disclosure is straightforward:

The best disclosures are simple, like “This is an ad for BRAND” or “This video is paid for by BRAND” or “BRAND paid me to tell you about it.”  Per the FTC the disclosure should be conspicuous, along with the endorsement, not in a separate location or as the FTC states, “hard to miss”.

Since we are talking about alcoholic beverages there are additional concerns when engaging with influencers.  Most state laws prohibit advertisements for alcoholic beverages that appeal to children.  Yet, beyond state or federal laws, industry members have collaborated to create responsible advertising practices for alcoholic beverages. Each industry category group has created their own standards yet the themes throughout all of them are very similar. (See DISCUS, Wine Institute, Brewers Association).

These industry standards apply to influencers who are acting on the brands behalf or at the brands request. Accordingly, influencers should be mindful of the following:

1. Adult Audiences: make sure ads and marketing “are placed in broadcast, cable, radio, print, and internet/digital communications where at least 73.8 percent of the audience is reasonably expected to be 21 or older.”
2. Social Responsibility: Per the DISCUS Code, “Beverage alcohol advertising and marketing materials should portray beverage alcohol products and drinkers in a responsible manner and reflect generally accepted contemporary standards of good taste.”
3. Responsible Drinking statements: Promotional and advertising materials for brands should include statements reminding consumers to enjoy these products responsibly.

The Wine Institute has issued a code for Digital Marketing. Brands should be familiar with these guidance materials.

Email and SMS Marketing: A Precision Tool with Strings Attached

Proactively contacting consumers via their email or SMS messaging is a fabulous marketing tool but a highly regulated means of communication. Starting with California and the CCPA many states have laws governing how businesses may use customers personally identifiable information (PII).  In sum, when a business collects PII from a customer they must have a privacy notice which informs the customer what information is being collected from them and how it will be used by the business.  This information includes whether the information will be shared with other entities and if so for what purposes.  Customers must also be given the right to request that their PII be deleted from a business and no longer used in the manner which the business said it would use it.  This is often thought of as a customer’s right to be forgotten.

Once a business starts collecting PII either directly from customers or from third parties, it must take great efforts to protect that information from outside access (data breaches). It must keep track of where the PII is stored, how it is used and who, if anyone, it is released to.  The businesses using the PII must always comply with their privacy notice and if usage changes, the notice must be updated, with notice to consumers and again. Customers must always retain the right to delete their information.

Business must also be mindful of the CAN-SPAM Act which regulates both emails and SMS messages of “commercial content”.  The most important requirement under the CAN-SPAM Act is the requirement to identify communication as ads. It must be clearly understood that a message is an ad rather than part of a service or anything else.  Additionally, the message must provide a means for the customer to opt-out of receiving these messages.  Information on other aspects of the CAN-SPAM Act can be found here.

Again, since we are not talking about regular CPG items but alcohol and advertising, all messages and SMS that are advertisements should continue to adhere to the above industry guidelines.  They must reach adult audiences, be socially responsible and contain a responsible drinking statement. If the message or ad enables a sale, identify the licensed seller.  Do not make regulators guess or even think an unlicensed entity is selling alcohol.  Inform them that this ad is on behalf of a licensed retailer.

Here are some helpful resources:

FTC Endorsement Guides
FTC Influencer Guide

Website Compliance: Clarity is Key

To reiterate, only those licensed to sell alcoholic beverages can offer alcoholic beverages for sale.  That means if a licensed retailer is offering spirits for sale, it must be clear to the consumer who the licensed retailer is.  If a sale is enabled, the retailer must be identified with their DBA and address.

As also stated above, the FTC protects consumers from deceptive advertising.  If a product placement or ad on a third-party platform is paid for, then that needs to be disclosed to the consumer.  Publishers/ third parties are free to select the term they want to indicate a product placement is paid. Some use the term “Ad” in the corner, others use “Sponsored”.  No matter the word, it must be clear to the consumer that they are seeing the paid content.

Creativity Within Compliance: The AccelPay Way

The digital marketplace allows brands to get closer to that high intent customer than ever before.

Brands can’t literally follow a customer into the store but with the use of third party providers, brands can interact with customers as they are on their e-commerce shopping journey.  Is it without regulation, no? Is there clear regulatory guidance?  Questionable. It all leaves room for creativity.

Navigating the intricate world of digital marketing and e-commerce within the alcohol industry can be a daunting task. The line between innovative outreach and regulatory compliance is often fine, requiring a nuanced understanding of both marketing strategies and legal boundaries. If you're at the helm of e-commerce for a leading alcohol brand, pondering the complexities of executing a digital marketing plan that's both effective and lawful, we're here to pave the way.

See how our tailored solutions can streamline your e-commerce operations, ensuring they're not just compliant but also optimized for maximum performance. Let's collaborate to refine your online presence, making it a beacon of efficiency and compliance in the digital realm.

Connect with us for a consultation, and let's set the stage for your brand's compliant and successful digital journey.

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