The Federal Trade Commission has recently made changes governing endorsements and testimonials that will affect advertisers and bloggers. As these changes will affect many of our clients, we would like to share them publicly to raise awareness.
As the announcement, published by the FTC on October 5, states, "the notice incorporates several changes to the FTC's Guides Concerning the Use of Endorsements and Testimonials in Advertising, which address endorsements by consumers, experts, organizations, and celebrities, as well as the disclosure of important connections between advertisers and endorsers."
Please note, this is not legal advice. We encourage you to consult your legal team or lawyer concerning the changes listed below.
- Advertisements that feature a consumer and convey his or her experience with a product or service as typical when that is not the case will be required to clearly disclose the results that consumers can generally expect.
- "Material connections" (sometimes payments or free products) between advertisers and endorsers - connections that consumers would not expect - must be disclosed.
- While decisions will be reached on a case-by-case basis, the post of a blogger who receives cash or in-kind payment to review a product is considered an endorsement. Thus, bloggers who make an endorsement must disclose the material connections they share with the seller of the product or service.
- If a company refers in an advertisement to the findings of a research organization that conducted research sponsored by the company, the advertisement must disclose the connection between the advertiser and the research organization.
- A paid endorsement - like any other advertisement - is deceptive if it makes false or misleading claims.
- Both advertisers and endorsers may be liable for false or unsubstantiated claims made in an endorsement - or for failure to disclose material connections between the advertiser and endorsers.
- Celebrities have a duty to disclose their relationships with advertisers when making endorsements outside the context of traditional ads, such as on talk shows or in social media.
Please visit http://www.ftc.gov/opa/2009/10/endortest.shtm
to read the full article. Click on 'Text of the Revised Endorsement and Testimonial Guidelines' to view the changes and examples in the official notice.