• Ad Age, Tuesday, December 12, 2006 12:01 PM

The Federal Trade Commission yesterday rejected a petition from the consumer watchdog group Commercial Alert that claimed marketers were "perpetrating large-scale deception" by paying consumers to shill for products but not revealing the financial arrangements.

But the FTC did leave the door open for the commission to examine issues on a case-by-case basis. In short, marketers could be playing with fire if they pay people to post opinions about products, such as movies, cell phones or electronics to Web sites without making their sponsorship clearly visible.

The ruling could lead to increased spending in an area that's already growing in popularity with marketers, whose audiences are harder to reach in an era of increased media fragmentation. Commercial Alert Executive Director Gary Ruskin blasted the FTC's decision, saying in a release the FTC gave word-of-mouth marketing a "giant Christmas present."

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