A marketing and promotional company wishes to install “digital table tents” comprised of tabletop-based, interactive video monitors and related equipment in select on-premises retail establishments. The digital table tents, among other things, would display advertisements for products, including alcoholic beverages.
The marketing company owns the intellectual property behind digital table tents/tablets that may be mounted on a table in a licensed on-premises venue. The table tents then display video and interactive digital content to consumers. The content contains advertising and other non-advertising content such as sporting events, trivia, public service announcements and information on the host venue.
The marketing company maintains control over the content of the table tents. The marketing company collects marketing fees from advertisers and then pays the licensed on premises retailer a flat fee for the ability to install the table tents at their venue. The marketing company then intends to pay the retailer a monthly fee based upon a percentage of the fees it receives from non-alcoholic advertisers. The marketing company states that the retailer will not receive any portion of the payments received form alcoholic beverage advertisements.
SLA Rule 86.4(b) prohibits manufacturers and wholesalers form directly or indirectly paying a retailer for displaying a sign inside their premises or for any expense incidental to its operation.
Does the payment by the marketing company to retailers constitute an indirect payment by manufacturers or wholesalers for displaying a sign/advertisement in violation of Rule 86.4(b)?
The system was created to segregate payments from alcoholic beverage manufacturers and wholesalers from all other advertisers. The marketing company has stated that a retailer will never receive money paid to them by manufactures and wholesalers. The Board finds that segregation of funds does not overcome the prohibition set forth in Rule 8.4(6).
Money is fungible. It is of no relevance which particular the marketing company clients gave them a particular dollar as long as dollars from the marketing company are paid to retailers. Tracking specific dollars does not declassify the payment by the marketing company to a retailer as an indirect payment from a manufacturer or wholesaler. Accordingly, because manufacturer and wholesaler the marketing company for advertising time on the digital table tents, the Board deems such a payment an indirect payment form the manufacturer or wholesaler to a retailer for displaying a sign/advertisement in violation of Rule 86.4(b).
However, the Board will permit the marketing company to provide the digital table tents to retailers in the following manner: The marketing company may permit retailers to create 20 percent for the content programing on the digital table tents in exchange for installing and using them in their premises. Under this agreement, the retailer receives no monetary compensation directly or indirectly from manufacturers and wholesalers. Under this agreement the benefit/gift conveyed to the retailer is directly and solely from the marketing company a non-licensed entity. This model was adopted by the state of Florida in response to a similar application.