The Federal Trade Commission (“FTC”) is seeking public comment on proposed changes to its guides concerning the use of endorsements and testimonials in advertising. FTC guides are advisory in nature and intended to assist businesses in complying with laws administered by the FTC.
Endorsements and advertisements are defined broadly to mean any advertising message that a consumer is likely to believe reflects the opinions, beliefs, findings, or experiences of a third-party. 16 CFR § 255.0. Currently, FTC guides provide that endorsements must reflect the honest opinions, findings, beliefs, or experiences of the endorser. 16 CFR § 255.1. Endorsements may not contain any representations that would be deceptive or that could not be substantiated. Id. If the endorser’s experience is not generally representative, the advertisement should clearly and conspicuously disclose what the generally expected performance should be. 16 CFR 255.2. And when there is a connection between the endorser and the advertiser, that connection must be fully disclosed. 16 CFR 255.5.
Many of the proposed changes are simply clarifications or changes to illustrative examples. Other changes establish principles not previously present in the guidelines. The FTC has proposed the following noteworthy changes to its guides:
- revise the definition of endorsement to include marketing and promotional messages. Tags on social media may also be considered endorsements under the proposed guidelines;
- change the definition of “product” to include “brand;”
- clarify that a “clear and conspicuous” disclosure means a disclosure that “is difficult to miss (i.e., easily noticeable) and easily understandable by ordinary consumers;”
- add that endorsements in advertisements addressed to children may be of special concern because of the character of the audience. Practices that would not ordinarily be questioned in advertisements to adults might be questioned in advertisements directed at children;
- note that when a claim in an advertisement is visual, required disclosures should be at least visual. When the claim is audible, the disclosures should be at least audible;
- explain that endorsers and not just advertisers may be liable for their statements such as when they make representations they know or should know to be deceptive;
- provide that using the likeness of a person that is not the actual endorser is deceptive if it misrepresents a material attribute; and
- clarify that disclosures of the connection between advertisers and endorsers must be “clear and conspicuous;”
Comments regarding the proposed amendments must be received on or before September 26, 2022. Comments captioned “Endorsement Guides P204500” may be submitted at https://www.regulations.gov.
For more information on recent FTC activity impacting advertising and endorsements, please consider listening to our May 5, 2022 podcast with Guest Malini Mithal, Associate Director of the FTC Division of Financial Practices.