| On December 1, 2009, the Federal Trade Commission | | | | The biggest change to the FTC guidelines, however, |
| (FTC), an agency of the United States government, | | | | revolves around endorsements of products and |
| published a new set of guidelines on testimonial | | | | services, particularly from online bloggers. Any kind of |
| advertisements and product endorsements. These | | | | "material connection" between an endorser (like a |
| guidelines affect all commerce within the United States | | | | blogger) and an advertiser must be disclosed to the |
| of America, including online commerce. If your business | | | | consumer. A material connection can be a cash |
| is based in the United States or targets residents of | | | | payment, a free sample, or some other benefit to the |
| the United States, you need to be aware of and | | | | endorser from the endorsee. |
| comply with these rules. | | | | If you receive a free copy of a product or free use of |
| The two major changes that affect online businesses | | | | a service in exchange for writing about it, you must |
| deal with how testimonials are presented and the | | | | disclose this. |
| expansion of what constitutes a "material" relationship | | | | If you receive a payment or commission for selling a |
| between two parties. | | | | product or service via a positive review, you must |
| Customer testimonials are used to sell many products | | | | disclose this. |
| online, just as they are used in print, radio and television | | | | If you are paid to write about or mention a product or |
| advertising. Besides upholding the principle that these | | | | service, you must disclose this. |
| testimonials be accurate and authentic -- that they | | | | Again, these rules are there to protect the consumer. |
| come from actual customers with arms-length | | | | There are special rules that affect expert and celebrity |
| relationships to the business promoting the product or | | | | endorsements as well. |
| service -- it also requires businesses to clearly disclose | | | | Failure to comply with the FTC guidelines leaves your |
| what a typical customer can expect from purchasing | | | | business open to litigation, which could be nuisance at |
| or using the product or service. | | | | best and disastrous at worst. Each violation can |
| For example, a weight loss program that includes | | | | subject you to substantial fines. |
| testimonials from customers who lost 11 pounds in one | | | | The best defense is to be open and honest with |
| week would have to disclose that this is not typical, | | | | consumers. Be sure to disclose any relationships you |
| that most customers would in effect lose an average | | | | have with your advertisers or with the products or |
| of only (say) 1 to 2 pounds per week instead. Because | | | | services you promote, and make sure any testimonials |
| consumers place more trust in testimonials, it's | | | | you display are accurate and typical. It's better to be |
| important that they not be used to mislead consumers. | | | | safe than sorry! |
