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Direct Response Marketing

Regulations Not Typical

1 Dec, 2009 By: Thomas Haire Response

Goldstein contends that creating a “net impression” about your product through the use of testimonials may be a good way to initially test how stringently the FTC applies the new Guides. “In the revised Guides, the FTC has reiterated the longstanding principle that all advertising claims will be evaluated based on the net impression of the advertising as a whole,” she says. “If the overall net impression of the show and the testimonials is that the results depicted in the testimonials are highly individualized and not representative of the results that consumers may generally expect to achieve, the advertiser need not necessarily disclose what the generally expected results will be.” She believes that the requirement to disclose expected results would only be “triggered when the net impression of the advertising is that the testimonials being presented are in fact typical or representative of the general consumer experience.”

Goldstein adds, “For example, selecting a range of testimonial experiences and including more detail about each endorser’s personal experiences in a manner that highlights their individuality may help create the proper net impression.”

Sater reminds marketers that the Guides are just that — Guides, not laws. “There is another possible alternative, here — even if the FTC may not like it, thereby making it a risky alternative until someone does it right and proves it can be done — and here’s what it is: keep running ads with testimonials and use ‘results not typical’ disclaimers, just like before, but make it crystal clear in those ads that the best and most impressive testimonials are not results that generally will be experienced, but are there to inspire people as to what is possible in the extreme case.”

Are Celebrity Endorsers Now on the Hook?He contends that in a footnote to the new Guides, “even the FTC had to admit that it can’t ‘rule out the possibility that a clear, conspicuous, and informative disclaimer could accomplish [the] goal [of making it clear that a particular testimonialist’s experience is not typical].’” Sater says more aggressive marketers may test this footnote, adding, “The FTC’s pronouncement that, in its opinion, ‘results not typical’ disclaimers don’t work is just that: an opinion. It isn’t Gospel, it isn’t in the Ten Commandments, and it isn’t even law. That means that with a well-written, well-produced ad that goes out of its way to trumpet the atypicality of its most impressive testimonials, the FTC understands that it will be hard-pressed to prove that the ordinary consumer who sees that ad draws the conclusion that those testimonials are the typical results.”

Sater goes on to qualify his opinion. “Of course, if you are totally averse to any legal risk, this would not be the best approach for you, at least until someone else has done it and shown it can be done.”

However, Goldstein offers a differing thought. “Marketers should ensure that the selection of testimonials presents a balanced view,” she says. “Shows that concentrate upon and show only the most extraordinary and remarkable experiences are likely to be subject to greater scrutiny and present a heightened risk of running afoul of the Guides.”

Document Everything
Another key issue includes documentation and substantiation of claims — especially those made in testimonials and those that fall closer to the “generally expected results” concept promulgated by the new FTC guides. Many marketers may be financially unprepared to do the kind of testing that the new Guides seem to push on marketers. However, legal experts believe strong documentation is crucial and can be accomplished by all marketers, from entrepreneurs to the corporations, in an essentially painless way.

Sater says, “The FTC suggests marketers who use who use testimonials that contain statements about their experiences should disclose the level of performance that customers should generally expect” from the product if it is used as depicted in the ad. The FTC wants each such marketer to figure out, before going public with its ad, what the ‘generally expected performance’ is for its product, when it is used in the depicted circumstances, and wants that marketer to disclose that ‘clearly and conspicuously.’ If a marketer wants to go down that road, then it would be well advised to invest time and money to figure out the ‘generally expected performance.’”

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