Haynes Boone Partners Joe Lawlor, Tiffany Ferris and Associate Ariella Kleiman authored an article for Ad Age providing strategies to help brands comply with government guidelines after the Federal Trade Commission issued a final rule prohibiting fake consumer reviews and testimonials.
Read an excerpt below.
The Federal Trade Commission has issued a final rule prohibiting fake consumer reviews and testimonials. More specifically, the rule expressly prohibits:
- Purchasing positive reviews
- Misrepresenting company-controlled review websites as independent
- Making baseless threats to suppress reviews or misrepresenting posted reviews as all-encompassing when negative reviews have been suppressed
- Engaging in similar behavior that may deceive consumers as to the authenticity of reviews
There has been a focus on the rule’s likely impact on fake reviews that appear on e-commerce platforms. But brands should not overlook the rule’s impact on influencer marketing, because it also prohibits purchasing, procuring, selling or distributing “fake indicators of social media influence.”
When the rule goes into effect later this year, the FTC could seek civil penalties from violators, meaning brands that have not implemented policies to ensure compliance could find themselves on the receiving end of hefty monetary penalties.
What is a fake “indicator of social media influence”?
The rule defines it broadly to include “any metrics used by the public to make assessments of an individual’s or entity’s social media influence, such as followers, friends, connections, subscribers, views, plays, likes, reposts and comments” that does not represent real individuals, their opinions and experiences.
These include bots, accounts not associated with a real individual, accounts created without consent and stolen accounts.
The rule addresses an important area in marketing at a time when tools such as generative AI are poised to increase the incidence of “fake” social media engagement. However, it does not represent a change in the FTC’s approach to deceptive social media marketing practices.
To read the full article from Ad Age, click here.
