FTC: Bloggers, testimonials need better disclosure

Bloggers must disclose freebies or payments; testimonials to reflect typical results

By Deborah Yao and Emily Fredrix

The Federal Trade Commission on Monday took steps to make product information and online reviews more accurate for consumers, regulating blogging for the first time and mandating that testimonials reflect typical results.

The FTC will require that writers on the Web clearly disclose any freebies or payments they get from companies for reviewing their products. The commission also said advertisers featuring testimonials that claim dramatic results cannot hide behind disclaimers that the results aren't typical.

The FTC said its commissioners voted 4-0 to approve the final guidelines, which had been expected. The guides are not binding law, but rather interpretations of law that hope to help advertisers comply with regulations. Violating the rules, which take effect Dec. 1, could result in various sanctions including a lawsuit.

Testimonials have to spell out what consumers should expect to experience with their products. Previously, companies had just included disclaimers when results were out of the ordinary -- such as a large weight loss -- noting that the experience was not typical for all customers.

Testimonial advertisements can be effective for consumers since they show others talking about their experiences, giving hope to the consumer that they'll have that experience too. But they are misleading to consumers if they don't disclose what they should truly expect to experience, the commission said.

For bloggers, the FTC stopped short of specifying how they must disclose conflicts of interest. Rich Cleland, assistant director of the FTC's advertising practices division, said the disclosure must be "clear and conspicuous," no matter what form it will take.

http://finance.yahoo.com/news/FTC-Bloggers-testimonials-apf-468964868.html?x=0