The Federal Trade Commission on Monday announced that it has approved final revisions to the guidance it gives to advertisers on how to keep their endorsement and testimonial ads in line with the FTC Act. The notice incorporates several changes to the FTC’s “Guidelines 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. The guidelines were last updated in 1980.
Under the revised guidelines, 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.
The revised guidelines add new examples to illustrate the principle that “material connections” between advertisers and endorsers must be disclosed. These examples address what constitutes an endorsement when the message is conveyed by bloggers or other “word-of-mouth” marketers.
The revised guidelines specify that 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. The FTC said it will consider paid endorsements – like other advertisements – to be deceptive if it makes false or misleading claims.
Celebrity endorsers also are addressed in the revised guidelines. The revised guidelines say that 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. They also say that celebrities must disclose their relationships with advertisers when making endorsements outside the context of traditional ads, such as on talk shows or in social media.
The FTC said that guidelines are administrative interpretations of the law intended to help advertisers comply with the Federal Trade Commission Act, and are not binding law themselves.