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Going Downhill? – The New FTC Ruling

Posted on 10. Oct, 2009 by MRR in Marketing Tips

Disclaimer:  We are NOT lawyers, everything you read below is just our opinion only.

If you’re trying to sell a product, it’s always a plus when you’ve got a customer wanting to give you a testimonial for the product they purchase, in fact I would say receiving a testimonial is gold dust.

Testimonials are not new by any means,  it’s present in many print ads and commercials all across the country.  When it comes to Internet Marketing, testimonials are no new thing either. We see this in almost every blog and affiliate marketing site we can find. These entrepreneurs use consumer testimonials on products in order to sell their merchandise, and in a world full of scams and consumer apprehension, testimonials seem to be one of the few good strategies that Internet marketers can bank on.

However, recently, the U.S. Federal Trade Commission has sanctioned a new law that seems to be dragging Internet marketing to its doom, or is it?

User testimonials, as we know them, can no longer exist as they are, with the FTC imposing certain rules before the use and implementation of such is done.

As is commonly seen, websites that promote products and certain services online rely heavily on user and consumer testimonials and opinions as part of their marketing strategy. They attract customers, enticing them to buy and put certain credibility in the products being promoted. Some of the most common that we see around are:

•    “I lost 120lbs in just 2 weeks…”
•    “My website profits doubled in value overnight!”
•    “I saw an increase in the web traffic within a span of just 3 days…”

Under the old guidelines in the use of consumer testimonials, a certain disclaimer – such as “results may vary/results not typical” was enough to be able to publish any type of testimonial without having to worry about generating false claims or creating deception to your customers.  With the new policies that the FTC has put into place, it is no longer that easy to use and post user testimonials on your websites.

The safe harbour of “results not typical” is no longer a good enough counteraction.

What the FTC recommends is that testimonials convey the results that the typical user will generally see and experience after using the product.  Testimonials of extraordinary claims and results paired with results not typical statements are not allowed – rather, it must be specified that the typical user “will experience ABC results.” Basically the FTC wants you to portray to your potential customers what the general outcome of the product will be, that’s going to be tricky to say the least, but it’s something every single Internet marketer must learn from now on.

These guidelines, however, only seem to apply to testimonials that talk about results, and not those that express emotions and opinions of the product such as “I love this product!” or “I’m so glad I invested in this…” General statements need not follow these restrictions.

There has been a lot of doom and gloom about this, MRR members have even been asking us what we think, and to be honest we probably know as much as you.  But from my understanding, if you have a testimonial on your site basically saying:

“I made $100,000 while I cut my toe nails, thanks a lot!”

then you can expect to have some trouble coming your way.

I’ve also read that a lot of marketers won’t even be using testimonials from now on, I don’t think it has to be that drastic, but the testimonials you normally see floating around with claims of massive income, or even weight loss gained will be a thing of the past.

Is it a bad thing for marketing?  I don’t believe so, I think this will actually help the IM realm, the bad and the good will be separated at last.  How many times have you come across these sites promising you instant wealth online while you push a button?  First of all there is no such thing as instant wealth at the push of a button, no matter how hard these people try to portray it, but to make things even more cringe worthy the sale page is littered with fake testimonials using stock photos of people.  I actually saw one of these a couple of days back, and recognized the photos from iStockPhoto.com!

In my opinion, if you play by the rules of the FTC you will be absolutely fine.  There is a lot of confusion, a lot of questions being asked, and I even find myself in the Warriors for hours reading what others think about this new ruling.

All in all, with the fines that could be imposed, it might be a wise decision to comply with these FTC requirements. It’s easy to see and believe that this just means the end of the online marketing era. In fact, these new rules and laws should not be a signal for the death of Internet marketing as we know it, but rather the beginning of a more honest, healthier, and well regulated online marketing industry.

Here’s Frank Kern’s take on this Click Here, you really SHOULD give that a read, he explains exactly what he thinks of this whole thing, in a way that only Frank Kern could!