The parties should spell out not only who is responsible for promoting the site but also what kind of promotion is expected press releases, promotions on each party's main site, or advertisements on third party sites and which party pays for promotion expenses. Each party's promotional responsibilities should be carefully defined so that neither party is surprised by the nature or lack of the other party's advertising and promotional activities. Finally, the parties should establish who will own customer data, whether there will be any limitations on the use of the data, how the parties will comply with spam and privacy laws, and what happens after termination of the co-branded agreement. Sweepstakes and Contests One of the popular methods for driving traffic to sites is through the use of sweepstakes and contests. However, because sweepstakes and contests are subject to a wide variety of state and federal laws, it is critical that companies entering into co-promotion affiliations using such methods determine who will be responsible for ensuring legal compliance.
Many states require detailed disclosures in the ad copy and rules.
To determine whether an entity is an operator, the FTC will consider who owns and controls the information, who pays for the collection and maintenance of the information, what the pre-existing contractual relationships are in connection with the information, and what role the web site plays in collecting or maintaining the information. Companies should therefore proceed with caution when entering into a strategic partnership or affiliation with a site that appeals to children. Conclusion Strategic partnerships can lead to increased web site traffic and visibility, e-commerce revenue, and access to a partner's resources. The key is to craft an agreement that takes into account each party's responsibilities and expectations so that both parties benefit from the arrangement. Jill Westmoreland, an associate at the firm, assisted in the preparation of this article.