User-Generated Marketing: Legal Implications when Word-of-Mouth goes Viral

This article discusses legal implications for businesses which engage in viral marketing. In the wake of the adoption of social media such as Facebook and YouTube, viral marketing has become much cheaper, which in combination with an increased trust in other people’s opinions makes viral marketing very efficient and widespread. The article focuses on EU legislation concerning identification of marketing, unsolicited commercial messages, and marketing buzz. The nature and quality of the business’ encouragement of private individuals to spread its marketing material is essential in determining whether the business is liable for activities carried out by private individuals. The Unfair Commercial Practices Directive adopts a tradition of applying an average-consumer-test, which in the light of the low-cost communication platforms utilised for viral marketing is likely to lead to lawful deception of a large amount of consumers.