regulation

FTC Clamps Down On Ad Testimonials

Mary Engle

An ad for "Nuclear Nano Technology Weight Loss Pills" features a woman claiming to have lost 100 pounds in a month. A nanosecond before the ad ends, a super flashes: "Result are not typical." Indeed.

A note to makers of Nuclear Nano Pills: The Federal Trade Commission is changing its guides on endorsement that eliminates advertisers' ability to use statements like "Results may vary" as a safe-harbor disclosure that eliminates responsibility to substantiate claims.

Mary Engle, associate director of ad practices at the commission, speaking at the NAD Annual Conference in New York on Monday, said that while the guides are not law, they "put meat on the bones" of the general rules in Section 5 of the FTC Act. "The change puts advertisers using endorsements on the same footing as all other advertisers." The NAD is the Better Business Bureau's National Advertising Division.

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The commission on Friday issued a notice on the changes that will be applied to new guides this year. Engle says the biggest change is one of principle, that an endorsement claim is no different, materially, than any other advertisement -- that endorsers' claims are essentially those of the advertiser.

"Our research suggested that even if you made a prominent disclosure that [an endorsement] 'is an exceptional result,' it did not change consumer perception, takeaway or net impression. And fleeting superscripts you barely see or understand is the way most choose to [run disclaimers.]"

She says the FTC's guides were never intended to let "advertisers say one thing in the headline and take it away in the footnote. The emphasis should not be on disclaimers. It should be on what is the message I'm conveying to consumers."

David Vladeck, who has been head of the FTC's Bureau of Consumer Protection for four months, said, "Disclaimers of guidelines are not working. Misuse has been especially prevalent in weight-loss products," he said at the conference.

"In the FTC's review of 300 ads, two-thirds used consumer testimonials. Few showed realistic claims, and disclosures of atypical results were flashed too quickly to read. 'Results may vary' does not adequately inform consumers that claims are outliers or extreme cases. They do not disclose results consumers should realistically expect. That is the main problem."

Vladeck says the revised guides do not bar use of disclaimers -- they merely make advertisers responsible for ensuring that consumers are not misled by an ad in its entirety. Advertisers are subject to the same disclaimers under section 5 of the FTC Act as those not using testimonials. "It was never intended that ads using testimonials should be subject to lesser standards," he said.

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