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Attorney’s Guide to Ethical Marketing: Colorado

 

This post is part of the Attorney’s Guide to Ethical Marketing, a series of posts (and eventually an eBook) that provides attorneys with a summary of key ethical rules for marketing across all fifty states, and the US territories.  If you want to be notified when your jurisdiction is covered, subscribe to The Dead Drop, my monthly newsletter covering updates from this site and beyond on marketing, law, and the psychology of persuasion.

• Relevant Citations: Colo. RPC 7.1-7.6

• Limitations on Direct Contact with Prospective Clients (Y/N): Yes. Direct contact permitted only via regular mail and only for other lawyers and for the soliciting lawyer’s family. See Colo. RPC 7.1 and 7.3.

• Permitted Forms of Marketing

• Traditional Media (Y/N): Yes

• Inbound Marketing (Y/N): Yes

• Social Media Marketing (Y/N): Yes

• Email Marketing (Y/N): Yes

• PPC Advertising (Y/N): Yes

• Mandatory Language (Y/N): Yes. See Colo. RPC 7.2(c), which states that attorney advertisements must include the name and office address of at least one responsible lawyer or law firm.

• Opt-Out Requirement (Y/N): Yes. See Colo. RPC 7.3(b)(1).

• Retention and Record-Keeping Requirement (Y/N): No

• Non-Surname Branding (Y/N): Yes, in part. Colorado prohibits the use of the names of public office holders in law firm names unless the holders of public office are practicing with the firm. See Colo. RPC 7.5(c).

• Date of Last Revision: April 12, 2018. See Colo. RPC 9.

Comments:

Other than noting a provision prohibiting law practices from obtaining public appointments via officials to whom they made campaign contributions, there is little to say about the Colorado Rules of Professional Conduct. See Colo. RPC 7.6. The Colo. RPCs are short and sweet, fairly closely following the Model Rules of Professional Conduct. Perhaps that’s a bit of burnout after the morass that was California, or perhaps it indicates areas of concern.

One area of concern may be in how the rules are written broadly, allowing for potential disputes concerning the intent behind the rules. For example, Colo. RPC 7.2 provides that attorneys may use all forms of “written, recorded, and electronic communication, including public media.” Colo. RPC 7.2(a) (it should be noted that this is a change from the model rules, which allow advertising across all mediums). No definition is provided in the Supreme Court Commentary to the rules as to what consititutes “public media,” nor are common questions answered about the content of the advertisement, other than the general prohibitions about false and misleading statements. While other jurisdictions address questions regarding the use of client testimonials, celebrity spokespersons and endorsements, mandatory use of language in the content of advertising, and the like (for example, see how detailed California and Arizona go in treating the content of advertisements, going so far as to regulate the style of text used in print advertisements). This may mean that Colorado is more flexible in how the courts can regulate attorney conduct, using broader rules open to more interpretation to handle attorney behavior, but it also means that attorneys have less specific guidance for knowing how to comply with the rules.

Why I don’t recommend advertising on Yelp

should I pay for advertising on yelpWhen I work with small to mid-sized businesses, I typically begin with helping them claim their businesses on various platforms. (Which platforms? That would be industry-specific, particularly depending on whether these businesses are B2B or B2C enterprises. In general, though, I am talking about Facebook, Instagram, Twitter, Google and Google Local, LinkedIn, and Yelp although niche platforms may apply.) For B2C (business-to-consumer) enterprises, this usually means they will claim their business on Yelp. A short time later, they often receive an email or call from a Yelp sales representative pitching advertising packages on Yelp. Often, my clients will then ask whether advertising on Yelp is worth it. This article addresses that commonly asked question about advertising on Yelp based its relative cost and what litigation concerning advertising on Yelp tells us about its service. The bottom line up front is that I do not recommend that small to mid-sized businesses advertise on Yelp, but I do recommend they claim their business on the service, and have a policy in place for spotting and responding to negative reviews there.

The Problem of Transparency in Cost and Performance On Yelp

Yelp does not publish its rates on its website for advertising, and is not very informative about how it determines its rates. A December 19, 2017 call to Yelp’s advertising department revealed that most customers pay $300.00 to $400.00 per month for advertising based on a pay-per-click model that Yelp described as similar to the one used by Google Adwords. When asked if the cost-per-click rates were available for review, Yelp advised that this was internal information and could not be provided to potential customers. In contrast, Google Adwords provides transparency to customers regarding the cost-per-click rate (CPC) for any given keyword.

google adwords example

Transparency in advertising price on Google

In plain English, with Google Adwords, businesses know what they can expect to pay and what they could get in return (based on past performance) before they invest in Google search engine marketing. With Yelp, advertising is hidden in a black box of an internal pricing structure. This criticism of Yelp is nothing new. Others have reported Yelp being unwilling to fully inform current or potential customers as to how their pricing model works (see, e.g., The Yelp Advertising Exposé, Yelp’s Cost Per Click Program – My Experience, and Advertising On Yelp: What You Should Consider.

Transparency (PDF) has become a key component in reforming corporate ethics after the scandals leading to Sarbanes-Oxley, and generally speaking, it is likely that transparency will become problematic for the search industry, which seems hellbent to preserve the secrecy of the algorithms governing search ranking (as an aside, could one imagine libraries doing the same thing?). Yelp’s lack of transparency may make one believe that the business is engaged in nefarious conduct. In fact, this has led to repeated litigation involving Yelp’s business practices, as detailed below.

Litigation involving Yelp

In 2014, Yelp shareholders engaged in a class action securities lawsuit before the District Court for the Northern District of California against the company for its conduct surrounding known fake reviews on its site. In 2015, the Northern District dismissed the suit. See Curry v. Yelp, Inc., Case No. 14-cv–03547-JST (2015). However, as noted by Forbes, this dismissal may be due more to the legal strategy of using securities law to target Yelp’s practices than it is due to the validity of Yelp’s conduct.

Also in 2014, the Federal Trade Commission engaged in an enforcement action against Yelp for violating the Children’s Online Privacy Protection Act. Yelp settled with the Federal Government, paying $540,000 in civil penalties.

In 2016, Yelp appealed a California decision in which it was ordered to remove defamatory content from its website. Yelp asserted in its appeal to the Supreme Court of the State of California that forcing Yelp to remove defamatory content violated its First Amendment rights and that the lower courts’ decisions violated the Communications Decency Act. See Hassell v. Bird, 247 Cal.App.4th 1336 (2016); Communications Decency Act of 1996, 47 USC 230 (the California Supreme Court has not yet issued its ruling). While, as a writer, I am generally in favor of expansive First Amendment rights, my experience as a lawyer has been that defamation has never been protected speech.

Best Practices for Dealing with Yelp

Given the repeated allegations of misconduct against Yelp, some of which has been substantiated, and some which has been dismissed, along with Yelp’s lack of transparency regarding its paid advertising, I believe it unwise to pay for advertising on the site. As reported by Hubspot, only 26% of consumers use branded apps – such as Yelp – to search for local businesses. As mobile devices are becoming the dominant tools for local search, small to mid-sized businesses are better served by focusing on the 74% of consumers that use search engines and Facebook to search for local businesses. In short, they are better served by focusing on the lower cost Google Adwords and social media marketing.

Should small to mid-sized businesses ignore Yelp, then? In a word: no. The site still appears in Google searches, and it represents a valuable way to get logistical data – addresses, hours of operation, telephone numbers, and websites – in front of potential customers. Additionally, businesses simply cannot ignore the potential for unanswered negative reviews on platforms like Yelp. Instead, businesses should have policies to ensure (1) their information on Yelp and other platforms is correct, and (2) that they respond professionally to negative consumer feedback on those platforms.

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