The FTC Wants Product Endorsers to Tell All
Did Joe Namath really wear pantyhose? Did Edie Adams smoke Muriel Coronella cigars?
These mysteries may never be solved. But they raise a larger question: Do celebrities use the products they endorse, and can you believe what they say?
They better, judging by new guidelines proposed by the Federal Trade Commission.
The FTC states that “endorsements must reflect the honest opinions, findings, beliefs, or experience of the endorser.” But it depends on how you define that term.
Namath may not qualify when it comes to pantyhose. But an auto racing champion who does a tire commercial would, and so would a top entertainer who demonstrates a home fitness system during an infomercial–even if she is reading from a script.
An exception would occur when a pro baseball player does a spot with a female comedian. They discuss gifts they plan to buy one another. The script is funny—the woman says she will get him a portable, high-definition TV so he can see the strike zone. Consumers wouldn’t think these two are expressing their own views, the FTC says.
A star who does claim to use a product must be using it at the time of the endorsement. And the sponsor can run the spot for only that period of time.
What’s more, the commercial arrangement must be disclosed in some situations. For example, a pro tennis player who says on a talk show that her game has improved has to disclose that she is paid by the clinic–provided she names it.
“Consumers would not expect that a celebrity discussing a medical procedure in a television interview to be paid for doing so,” the FTC says.
This guideline also covers bloggers. A college student who reviews video games on his blog should reveal that he gets copies for free.
And people who are paid to go on sites and write favorably about a product should also disclose their connection.
Case in point: An employee of a playback device manufacturer posts a message touting his firm’s product on a discussion board for MP3 enthusiasts.
“Knowledge of this poster’s employment likely would affect the weight or credibility of her endorsement,” the FTC writes. “Therefore, the poster should clearly and conspicuously disclose her relationship to the manufacturer…”
Now let’s move on to an arena typically inhabited by direct marketers.
Weight-loss advertisers are now able to have a consumer say they lose 200 pounds in a week—if it’s true. Granted, this isn’t normal, but they can get around it by stating, “Results not typical.”
This may change. The FTC wants these advertisers to disclose typical results in some instances.
Commenters have argued that this will hurt responsible outfits most because “they would expend resources to comply with the requirements, while marketers of pills and supplements with no scientific support would ignore those requirements or manipulate their data to produce fictitious averages.”
But the FTC argues that this change “would merely eliminate a safe harbor that has allowed advertisers to avoid the general requirement that they be able to substantiate all material claims conveyed by their advertising to reasonable consumers.”
What about the cost to advertisers? “Commenters may be overestimating those costs,” the FTC says.
And what if it’s not easy for a firm to establish typicality? It can “write its ad in such a way that consumers would not take away the message that they can expect to achieve the same results as the testimonialist,” the FTC says.
Here’s the bottom line: Whatever the venue and type of endorsement, the claim has to be true. And the advertiser has to be able to prove it. If the FTC gets its way, that will now include even implied endorsements.
Public comments are due by Jan. 30.







