Thanks to infomercials, dishonest advertisers, and lazy consumers we now have new FTC guidelines to consider when creating ads, websites, blogging, tweeting, and generally speaking our minds. [Disclaimer: the views expressed by this poster do not represent the views of the agency, its ownership, clients, certainly not our PR crew, and not even myself after getting caught up in a Woot-Off during the holiday season.]  A press release announcing the new guidelines and a link to download the guidelines themselves can be downloaded from the FTC website (in the lower right related info box or just follow this link to download the Text of the Revised Endorsement and Testimonial Guides).

Some highlights:

• Section 255.1.d – advertisers and endorsers are subject to liability for, among other things, not disclosing material connections.
• Section 255.5 describes how and when to disclose material connections.  Example 1 outlines a case in which a drug company commissions a lab to perform research on a product and shares the expenses.  Even though the drug company doesn’t have a say in the design and conduct of the research they must still disclose the payment of expenses.  The reason: “the weight consumers place on the reported results of the research could be materially affected by knowing the advertiser has funded the project.”  Of course if they perform the research internally, the results are sure to be biased.  What’s a drug company to do?  Any good “free” drug research labs out there?
• Contrast that with Example 2 where a film star endorses a product.  Even if the star is receiving a $1MM lump sum or royalties for each product sold … they don’t need to disclose that because “such payments likely are ordinarily expected by viewers”.  Huh?  Are we to assume all celebrity’s are on the take or just film stars?  Perhaps the FTC is making a push for celebrity endorsements.  If there is a material connection between the Screen Actors Guild and the FTC would they be obligated to disclose that?
• Example 3 in Section 255.5 describes a scenario in which a well-known pro tennis player who is a paid spokesperson for an eye clinic touts the results of her surgery and mentions the clinic by name.  ”Given the nature of the medium in which her endorsement is disseminated, consumers might not realize that she is a paid endorser.  Because that information might affect the weight consumers give to her endorsement, her relationship with the clinic should be disclosed.”  That answers one question — according to the FTC film stars are a different class of celebrity — and raises another.  What is it about the nature of the medium that clouds the vision of consumers?

This entry was posted on Tuesday, December 1st, 2009 at 2:40 pm and is filed under Risdall Advertising Agency Interactive, Risdall Marketing Group. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.