The United States Federal Trade Commission (FTC) has again shown that social media influencers, endorsements and testimonials remain an enforcement priority. The FTC sent warning letters to two trade associations and several dieticians and other online health influencers to make clear that failure to include clear disclosures that these are paid endorsements may violate the law.
If your company uses social media influencers in its advertising, you will want to consider whether your company is adequately monitoring what the social media influencers are saying about your product or service and how they are disclosing their relationship to your company in light of the updated guides and resources that the Federal Trade Commission issued very recently.
The general considerations have not changed, namely, that companies are “subject to liability for misleading or unsubstantiated statements made through endorsements or for failing to disclose unexpected material connections between themselves and their endorsers,” 16 CFR Part 255.1(d), but the requirement that companies have a reasonable program in place for monitoring their social media influencers’ compliance and what such a program should include is an important addition to the guidance.
Companies that publish or use reviews and testimonials should note the Federal Trade Commission’s new proposed “Trade Regulation Rule on the Use of Consumer Reviews and Testimonials.” The FTC’s Notice of Proposed Rulemaking would make particular customer review practices illegal, authorize courts to impose civil penalties, and strengthen FTC enforcement actions while deterring misleading marketing strategies.
The use of endorsements and reviews in advertising continues to be an area of active Federal Trade Commission (FTC) enforcement. On 29 June 2023, The FTC issued updates to its Guides Concerning the Use of Endorsements and Testimonials in Advertising and updated its practical business guidance “FTC’s Endorsement Guides: What People are Asking.”
If you sell goods and services to consumers through automatically renewing payment plans, free or discounted trials that convert into full plans, or other “negative option features” that interpret a consumer’s silence as permission to keep charging them, you should monitor and consider submitting comments on the Federal Trade Commission’s proposed Negative Option Rule. The proposed rule would impose detailed transparency, consent, simple cancellation and annual reminder requirements on companies that use any medium to offer recurring subscriptions for products or services, and allow the FTC to seek civil penalties of over USD 50,000 per violation and consumer redress for violations.
The use of endorsements and reviews in advertising continues to be an area of active Federal Trade Commission (FTC) enforcement. The FTC has proposed updates to its Endorsement Guides to strengthen advertising guides related to endorsements and reviews.
Off the Shelf, the Global Consumer Goods & Retail (CG&R) Industry Video Podcast, provides short practical legal insights into the key issues affecting consumer goods and retail businesses. Increasingly, the desire for CG&R companies to include references and claims about their sustainability stems from the demand by consumers to know more about the brands they engage with, particularly their sustainability credentials, and this is driving this trend for green/sustainability claims to be increasingly featured and promoted.
The use of endorsements, testimonials and reviews in advertising continues to be an area of active Federal Trade Commission (FTC) enforcement. Several recent actions by the FTC illustrate that it is prioritizing enforcement against deceptive or misleading endorsements, testimonials and product reviews and imposing significant penalties on companies engaging in such practices. In addition to its enforcement activities, the FTC has also issued recent guidance to enable marketers, platforms and others to consider whether their conduct might attract FTC scrutiny.
Off the Shelf, the Global Consumer Goods & Retail Industry Podcast, provides short practical legal insights into the key issues affecting consumer goods and retail (CG&R) businesses. Episode 16: New Brand on the Block(chain): Consortium Considerations In the final episode of our blockchain for brands series, Alyssa Auberger, Baker McKenzie’s Chief…
Off the Shelf, the Global Consumer Goods & Retail Industry Podcast, provides short practical legal insights into the key issues affecting consumer goods and retail (CG&R) businesses. The first Off the Shelf series focuses on COVID-19 and covers a range of issues, including longer-term considerations as CG&R businesses enter the…