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FTC Demanding Truth in Advertising

We have all seen those ads on TV where the four-hundred pound couch potato is turned into the svelte, chiseled bodybuilder-type with this latest and greatest green miracle at home exercise device that stores easily in a shoebox, is not only fun but actually exciting to use, takes 3 minutes every other day and harnesses the power of rubber bands, springs, dynamic tension, gravity, your own weight, someone else's weight, ball bearings in a swivel, a Chilean brush-tail rat in a runny-wheel—whatever, only to tell you at the bottom of the screen in print so fine that you need a hi-def TV and a magnifying glass to read it: “Results not typical, your results may vary.”

What? My results may vary? You mean I am not guaranteed to look like Michaelangelo's David made flesh after my first week of using the miracle exercise product? Apparently not. Apparently, the advertiser is trying to put one over on me—me, and enough other people for the government to take some action.

While these sorts of ads are a mainstay of daytime and late-night TV, right up there with Billy Mays and the Sham-Wow guy, they are likely to soon be a thing of the past if the Federal Trade Commission goes ahead with new rules that would force advertisers to use testimonials only from typical users. According to the Chicago Tribune:

Updated guidelines on ad endorsements and testimonials under final review by the Federal Trade Commission—and widely expected to be adopted—would end marketers' ability to talk up the extreme benefits of products while carrying disclaimers like "results not typical" or "individual results may vary."

Instead, companies would be allowed to tout extreme results only if they also spelled out typical outcomes.

According to the FTC's Richard Cleland, “You'd have to say not only is it extreme, but how extreme is it.” The basics of the new regulations, which are likely to be enacted later this year, are:

  • Consumer testimonials would have to be substantiated and ads would have to include generally expected results. Endorsers, not just advertisers, could be held liable for deceptive claims.

  • Celebrities who talk up a product in an interview must disclose if they are getting paid for the promotion. Celebrities who endorse products would have to disclose if they have an ownership interest.

  • Expert endorsers, like doctors, must have experience in the product area they are endorsing. If they don't, the limits of their expertise must be stated. For instance, an ophthalmologist identified only as a doctor could not be portrayed as an expert physician endorsing a hearing aid.

  • Bloggers who get free products and then endorse them on their blogs would have to make it clear they got the products free.

While this is not necessarily good news for those who rely on the kind of hype that extraordinary results can generate, rather than on the excitement that a great product with more or less self-evident value can generate, it is good for consumers and can protect them from buying useless products. It is also good for businesses that might, with the best of intentions, carry, promote or even use these products in the course of their business. For example, if you run a beauty business and are promoting a miracle product that turns out to be little more than snake oil, what effect can that have on your business? It's a fair bet that result won't be a positive one. Remember, belief in a product is fine, as long as that belief is based on hard evidence. That means studies and proper, expert endorsements. It means being open about your products and making only those claims that can be full substantiated.

That is what the FTC is demanding and everyone involved is accountable. It will be interesting to see the effect these new rules have once they are in place. Late-night TV will never be the same, but at least my results won't vary.