The Business of Creativity

Houchin Consulting PLLC

Target Rich Environment

Posted on | November 3, 2009 | No Comments

My friend Joel Rothman posted the following discussion relating to the FTC’s attitude toward the new rules regarding deceptive advertising in the context of endorsements and testimonials.  This is seriously important stuff for everyone that uses testimonials in their marketing – which is everyone.  So, PAY Attention!

… Then Vladeck (speaking of David Vladeck, Director of the Federal Trade Commission Bureau of Consumer Protection) turned to the new FTC Endorsement Guides.  Everyone held their breath.

Before I go further it is important to remember that Vladeck comes from a consumer protection background.   He led the Public Citizen Litigation Group for 20+ years.

On the endorsement guides Vladeck’s message was clear:

1. Disclaimers like “results not typical” are useless and will be attacked by FTC.

2. Advertisers who make claims “will be held responsible for their claims.”

3. If your promotion relies only on testimonials “you will have a problem with us.”

Vladeck described this area for the FTC as a “target rich enviornment” in which they intend to pursue violators using all the resources at their disposal.  And when the 1000+ enforcement personnel at the FTC run out, FTC plans to call on the state attorneys’ general.  When the AG’s are too busy, Vladeck says that they will do as the FDA does and publish warning letters on the internet in order to “bully companies into compliance.”

Despite the backpeddling FTC has done in the media recently, Vladeck made it clear that he will enforce Section 5 of the Federal Trade Commission Act and the endorsement guides.  It was as if Vladeck was drawing imaginary targets on foreheads around the room…

I spoke to several attorneys and CEOs at the reception that evening about the regulatory problem the enforcement guides present and everyone agreed that the problem is very serious.  One observed, candidly, that the problem was that “you never know what marketing is doing until it is too late.”

After all, lawyers and regulatory execs are considered “sales killers.”  We are never consulted by marketing in advance of a promotion for fear we will put the kibosh on the latest profitable social media marketing strategy.

So what’s next from the FTC?  Who knows.  After all, it’s a “target rich environment.”

For the full article. Visit Joel’s blog HERE.

Joel and I are working together on a new product and program to help companies of all sizes and in all niches become and remain compliant with the new rules. I should have more news about that to share with you on Thursday or Friday of this week.  If you are interested in helping promote this product, email me.


Leave a Reply

  • Tags

  • Archives