Stampin' Up! restricts Demonstrators' online activities [Updated]

Demonstrators for direct sales stamp and scrapbook supply company Stampin' Up! received a new Independent Demonstrator Agreement (IDA) yesterday which they must sign by September 30th if they wish to remain demonstrators with the company. The new agreement contains controversial new restrictions on the activities of demonstrators which have lead some demonstrators to say they will resign rather than submit to the new agreement's rules.

Two key areas of change have been made to the agreement in section nine, which is titled "Restrictions on Representation of Competing Companies or Products." The first areas of change, which seem to be the less controversial of the two, is that demonstrators are no longer allowed to work as members of design teams for competing companies. Demonstrators who are under contract to design teams for other companies will be allowed to fulfill their current term of contracted obligation to those other companies. General consensus from the demonstrator community (with a few exceptions) seems to be that it is understandable that Stampin' Up! as a company would want its demonstrators to have a commercial interest in selling only their product.

The second area of change seems to be the more controversial of the two. It has touched off a firestorm of criticism from demonstrators. It is the new sub-section (d) of section nine, which addresses specifically electronic communications as it relates to competing product:

I understand that the content of my electronic communications such as e-mail, personal blog, web site,  Twitter, Facebook, other social media and the like can have a considerable influence on how I am perceived as a Demonstrator for Stampin’ Up! and also reflect significantly on the Company. Accordingly, I will refrain from using such electronic communications to  promote, market, or sell the products of other companies (direct or retail sellers) who offer similar products, which includes:  decorative stamps (in any form), stamp art accessories, scrapbooking products, digital art solutions, and vinyl wall art.

The company has issued a FAQ (read it here) to help demonstrators interpret the new IDA. According to the FAQ, sub-section (d) means that demonstrators may not post information (names, stores or prices) about any products besides Stampin' Up! products anywhere online. In fact, since the agreement includes email in the communication that it covers, it appears that even providing that information to someone via private email might be considered a violation of the agreement. I have requested clarification on that point from the company's public relations department and will post the answer if/when it is received.

The FAQ stresses that demonstrators will still be allowed to post projects online (or have them published) but they cannot provide detailed product information about any non-Stampin' Up! products used in their projects. They also cannot publicize their participation in any online forum that promotes or sells non-Stampin' Up products. Yet many demonstrators say they rely on outside sites (such as sites that provide technique tutorial videos) to help them promote their business or educate their customers. Many consumers also say that their involvement with Stampin' Up products has also been enhanced by outside sites, such as this poster on Splitcoaststampers:

I've got to say that I discovered SCS through a friend/demo. I would have grown bored with SUOnly pretty quickly and SCS has kept me in stamping and buying SU. With the last SU catalog, I still earned level 2 hostess set. SCS has only enhanced my enjoyment of SU products. It's where I come to see samples with their latest stamps. Too bad the bloggers can't link it on their PERSONAL blogs.

-Nancy (Phantom)

But the most-discussed aspect of the changes to section nine have been the ones that apply to linking. The FAQ describes the new terms:

Q: On my personal blog, I have links to my friends' personal blogs and web sites. Some of them sell competing product. Do I need to remove these links?

A: Yes. In evaluating the links on your web site, you will need to remove any links to blogs, web sites, or the like that promote, market, or sell competitive products.

This is the section that has prompted the most outrage and resignation announcements by demonstrators. Many appear to be willing to limit their own posted content to company products, but can't stomach the thought of having to cut themselves off in the social online world from family and friends who aren't in compliance with the Stampin' Up non-compete policy.

My daughter is a SU demo. I am a DT member for 2 competetive companies. According to this new IDA she can not have my blog link on her blog site. What kind of CRAP is that.

-Neva (n5stamper)

And there is one big unanswered question about interpreting the policy - what constitutes "linking"? If being friends with someone on a social network constitutes "linking" to them in the eyes of the company, Stampin' Up! demonstrators could be in the position of having to police the content posted by their social media friends on sites like Facebook and Twitter, and having to cut themselves off from a great many people who might post content unacceptable to Stampin' Up! I've passed that question on to the public relations department at Stampin' Up! with a request for clarification and will post the answer on Scrapbook Update if/when it is received.

Update - Stampin' Up! has revised the FAQ about how the new demonstrator agreement will be applied to state the following:

Q: On my personal blog, I have links to my friends' personal blogs and web sites. Some of them sell competing product. Do I need to remove these links?

A: No and yes. On your web site, blog, or other online space, the policy is that you may not post links to competitive companies' web sites, or to locations where a customer could purchase competing products. As you evaluate the links that you provide, the only restrictions would be that the link should not a) direct to the company web site of a directly competing company (retail, online retail, or direct sales), or b) direct to the web site or blog of a representative for competitive products where the customer may purchase from directly. For example, if you link to a friend's site and customers can purchase products directly from your friend on that site, you need to remove the link to that site. If they cannot purchase products directly from your friend's site, you do not need to remove the link. Updated 9/2/09.

Q: I regularly participate in online forums relating to the craft industry, and maintain a gallery of my artwork on one of these forums. With the new IDA, is this activity still allowed?

A: Yes. Participating in forums and posting your projects for your fellow crafters can be an important method of inspiration and recognition. It's important to note that the new IDA does not prohibit this kind of activity. You may link to any blog or forum that highlights the crafting industry in general, regardless of the products highlighted or advertised. You may want to consider, however, where you are sending your customers, and the kinds of advertising they're likely to encounter when you make your decision on what kinds of links you recommend that your customers follow.

We are currently exploring ways to provide more of an open community and sharing environment, as well as opportunities for artistic recognition for our many talented demonstrators. We will keep you updated on any new developments. Updated 9/2/09.

These revisions make the application of the policy much less broad than the original version of the FAQ did as far as linking is concerned. This removes the concerns about violations from things such as friending on social media networks like Twitter and Facebook.

However, it appears the company is standing by the rest of the guidelines, issuing a statement to justify them that includes the following:

...the changes in requirements are meant to protect the Stampin' Up! brand and business as a whole, not restrict your personal freedom of creative expression. For example, consider the famous spokespeople that companies contract to represent their products, like Michael Jordan for Nike. Not only would it have been unethical for Michael Jordan to promote Reebok on the side, but Nike likely had a specific agreement with him not to do so. Your response to this comparison is likely, "But we don't have million-dollar bonuses from Stampin' Up!" That may be true, but we do compensate you for the work that you do, and you are definitely our superstars! We consider our demonstrators our partners in business, and an exclusive sales agreement between us is an important aspect of that partnership.

Will the linking restrictions being loosened and the explanation by the company be enough to placate angry demonstrators, or at least some of them?