Testimonials and Endorsements: Complying with the FTC Guides in Light of Proposed Changes

One of the most frequent strategies employed by advertisers is to let the consumer hear about the advertised product or service from a third party, someone other than the advertiser itself. At its root, an endorsement or testimonial when used in advertising is the advertiser’s way of saying, “Don’t just take my word for how wonderful my product or service is, listen to this unbiased person whose opinion you should rely upon to make a purchasing decision.” The Federal Trade Commission (FTC or Commission) originally published Guides Concerning the Use of Endorsement and Testimonials in Advertising (The Guides) in 1972. The Guides have not been updated since 1980. In January, 2007, the FTC sought comments on proposed modifications and updates to the Guides. In particular, the Commission sought comments on whether so-called “disclaimers of typicality,” statements like “Results not typical” or “Your results may vary,” should continue to be a valid way to communicate that a testimonial does not represent experiences consumers will generally achieve with the advertised product or service.

One of the driving forces behind the proposed revision of the Guides, especially with regard to “disclaimers of typicality,” was a pair of studies that the FTC had commissioned to examine whether consumer endorsements communicate product efficacy and typicality and whether any of the several prominent disclosures qualify or limit the claims conveyed by the ads (the FTC Testimonial Studies). As briefly discussed below, the FTC Testimonial Studies purport to demonstrate that consumers believe that consumer testimonials convey the message that the endorser’s experience with the advertised product or service is representative of what consumers can expect to achieve with the product or service, even when disclaimers of typicality are employed conspicuously.

The Commission received 22 comments last winter, including from the Association of National Advertisers and the Word of Mouth Marketing Association, both of which were written with the assistance of Reed Smith’s Advertising Technology and Media Group. These comments were noted by the FTC in its Notice of Proposed Changes to the Guides, which were published on November 21, 2008. The proposed changes will likely become final next spring, subject to any additional comments the Commission receives on or before January 30, 2009.

The purpose of this memorandum is to provide you with an update concerning the Guides and the direction in which the Commission is proceeding as well as to point out the sorts of information the Commission is seeking as it finalizes its amended Guides.

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