This series of articles addresses the complex regulation of alcohol marketing and promotions. The first article addressed trade practices rules governing how suppliers may market their products to retailers, while the second article addressed consumer promotions offered by retailers and suppliers. In this article, we will provide an overview of the laws governing the advertisement of alcohol in the United States.
Part III: Advertising
Companies advertising alcohol must navigate many layers of potential regulations. At the federal level, oversight and guidance by the Alcohol & Tobacco Tax & Trade Bureau (TTB), the Food & Drug Administration (FDA), and the Federal Trade Commission (FTC) may come into play. The TTB is the primary regulator of alcohol advertising, while the FDA is regularly consulted by the TTB with respect to ingredients, additives, and health-related statements. The FDA also has jurisdiction over some beers, seltzers, and low-alcohol wines. The FTC’s Bureau of Consumer Protection has published best practices for alcohol advertisements to reduce the chances that alcohol marketing appeals to underage consumers. In addition to federal rules, alcohol advertisers must also comply with state regulations which may be more restrictive.
The TTB oversees regulations governing the advertisement of malt beverages, wine, and spirits. TTB regulations require some Mandatory Statements in alcohol advertisements, including identifying the licensee responsible for the advertisement. These regulations also set out baseline Prohibited Statements in alcohol advertising, which include the following general limitations:
Advertisements may not be false, untrue, or create a misleading impression.
Industry member ads may not disparage a competitor’s products.
Advertisements may not contain statements that are obscene or indecent.
Statements inconsistent with product labels are prohibited.
TTB regulations also limit Health-Related Statements, and their guidance provides specific rules for using calorie/carbohydrate/sugar content representations and alcohol facts statements. These rules are highly detailed and will be addressed in a later article.
State laws may limit what Media Channels are allowed to be used for alcohol advertisements, and these rules may differ depending on whether the advertisement is for beer, wine, or spirits. For example, some states may prohibit direct mail alcohol advertisements, or may prohibit advertisement of alcohol via billboards. States may also limit how alcohol Discounts or other sales promotions may be advertised, to prevent advertisements that may promote overconsumption.
Producers who are members of trade associations, such as the Wine Institute or the Distilled Spirits Council of the United States, elect to comply with their association’s Advertising Code, which set out guidelines for best advertising practices. These voluntary codes set out requirements for things like the age of models used in alcohol advertisements, the demographics of media channels used for alcohol advertisements, guidelines for advertising alcohol via social media, or restrictions on advertising to college campuses.
The FTC’s guidance on best practices for alcohol advertisements also addresses how alcohol companies should avoid appealing to underage consumers. These guidelines address media channel demographics as well as content limitations. Further, for online advertising the FTC recommends Age Gates on websites or social media profiles to block underage access to alcohol advertisements.
Alcohol licensees should be aware that advertising rules apply even when the alcohol company is working with a Third Party Marketing company or Social Media Influencer that is placing alcohol ads on the licensee’s behalf. The general rule is that an alcohol business cannot pay an influencer or an outside marketing company to engage in advertising activity that the alcohol business would not be able to engage in directly, and thus contracts with these third parties should set out acceptable alcohol advertising guidelines.
Finally, alcohol producers are limited in how they advertise where their products are available for sale. As addressed in the first article in this series, trade practice laws limit how suppliers may provide things of value to retailers. Cooperative Advertising by a supplier on behalf of a retailer is considered a thing of value and is allowed only under limited circumstances by TTB regulations as well as state laws.
Our next article in this series on Alcohol Marketing and Promotions will cover the rules that apply to special events where alcohol will be promoted and served.