Advertising Alcohol at Esports Tournaments: Ring in the New Year Responsibly
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As we are ringing in the new year and you are planning for your next Esports event, with the adult beverages flowing freely you might get an idea. Imagine selling ads for adult beverage companies? Or displaying bottles on stream? Or suggesting certain ways to partake in such beverages?
You might want to think about that for a moment.
Just like any other sport, esports tournaments can feature advertising for alcohol brands. These tournaments can become a lucrative platform for advertisers resulting to increase of its revenue and profitability. But, advertising alcohol comes with unique requirements that you should be aware of so that you can follow them appropriately.
Advertising
At present, there are no specific state or federal laws prohibiting advertising alcohol to minors. However, alcohol advertising is self-regulated by the industry and subject to periodic review by the FTC.
Industry self-regulation for spirits is governed by the Distilled Spirits Council of the United States (DISCUS) (Note: DISCUS is only for spirits; wine and beer sales are governed by the Wine Institute and Beer Institute respectively). There are no prescribed penalties for violating DISCUS regulations, but they are subject to privately filed complaints, at which point DISCUS will conduct a board review and, if an offense is found, generally recommend that the offending ads be removed. (Example). Generally only the brand is the subject of DISCUS complaints, not the advertising platform (i.e. your stream).
That being said, it is advisable that you follow DISCUS guidelines to avoid negative implications from a DISCUS complaint, which could affect your relationship with your brand sponsors, or, in the worst case scenario, potential FTC action should the FTC determine that self-regulation is ineffective. A summary of DISCUS guidelines is below:
- DISCUS Digital Communication Guidelines (link). These are the 7 general principles of online advertising of spirts. Namely, brands must avoid advertising in a way that is particularly enticing to minors. For example, you should not visibly associate alcohol with items that are targeted to minors, such as by showing Star Wars toys or emoji with adult beverages. There are several other interesting requirements here too, such as requiring age affirmation prior to permitting direct interaction between the brand and user (relevant for click-through activities), and that a special notice must be placed on any communcations that are intended to be forwarded by users.
- DISCUS Media Buying Guidelines (attached). This describes the legal purchase age standard in detail, and how to implement it in online ads. Essentially, there must be a reasonable expectation that the ad audience is at least 71.6% of age 21 years or older. This can be proven in a variety of ways, including the past 3-months of user data (as of date of the ad buy) showing the recent age composition of the audience, or using user profiles to limit access to the ad to only those whose stated age is 21 or older, etc. I recommend you do your diligence to ensure you have a reasonable expectation for the age of your audience. Note that this may vary significantly depending on the game being played.
Sales
Note that the above do not necessarily apply to sales of alcohol. Sales of alcohol are significantly more difficult to transact legally than advertising. Ecommerce stores generally should expect to have a liquor license in every state it wishes to ship to, for example. To give an example, Amazon has been reported to try to buy hundreds of liquor licenses for its warehouses so it can sell alcohol online (link).
Alternatively, if you did want to promote online sales in some form, you can facilitate such transactions through a “deep link” (itself a form of advertising) into the brand’s ecommerce store for them to sell to the consumer. Note, of course, since you are promoting direct interaction with the brand and your audience in this instance, you should put in place a form of age verification with each deep link in order to prevent the appearance of targeting minors. This could be in the form of a simple “select your age” dial that is commonly seen online.
Andre J. Castillo and his law firm, Castillo Corporate Counsel, PLLC, provide business law services to tech start-ups and small- and medium-sized businesses. In this capacity, he has represented companies in deals with the world’s largest video game publishers, Fortune 500 companies, and government agencies. He can be reached via email at info@cccp.llc.
