Any business owner with an online presence should be aware of the Federal Trade Commission rules regarding Internet marketing and advertising per the The FTC Act section 5 and how the FTC interprets the information in it’s efforts to protect consumers from misleading and fraudulent claims of products and services.
This also includes consumer privacy protection which is very important if you are going to be collecting any personal information about visitors. That is a topic all to itself that business owners should familiarize themselves with. FTC Consumer Protection
Here are 2 really good guides the FTC has on their site to give an overview of the law:
FTC Advertising and Marketing on the Internet: Rules of the Road
FTC Frequently Asked Advertising Questions: A Guide for Small Business
For instance I could claim that:
Electronic Logic Concepts is sooooo awesomely good at SEO we guarantee number 1 placement for any and every keyword you desire, no matter how generic it is (restaurant, real estate, car sales, cat, etc…). But WAIT! There’s more! We will also throw in a complimentary red bridge and Unicorn for you to ride over that shiny red bridge for every SEO package purchased.
Our claim would be total baloney because everyone knows the Golden Gate Bridge is not red it is painted orange vermillion, which is also called international orange. 😉
In fact we have a page search-engine-top-10-results explaining why anyone claiming that they can guarantee top 10 SEO placement is not being very truthful about the realities and quirks of search engines and how they work.
Introducing the Environmentally friendly company car: The Hummer
Maybe you should think twice before announcing your “green” company car is environmentally friendly.
Hint: Painting it green doesn’t count.
This isn’t fraudulent advertising so much as whoever pulled the trigger on this particular purchase didn’t really understand the company business plan. I don’t think it is overly brilliant to try and woo potential customers into purchasing your environmentally friendly products and services when your ride is busy burning fossil fuel like a drunk on a binge. Of course, that is just my opinion. If you would like to know what the EPA thinks about the Hummer or any other vehicle check out their Green Vehicles page.
What are fraudulent claims:
What the FTC does care about is if your claims are deliberately misleading potential customers into making a purchasing decision based upon those claims. Advertising copy can sway a person’s decision making process. That is why billions is spent every year on advertising. Your website is a companies single best 24/7 selling tool. But if you are not factual you might get more than you bargained for. Not only will you loss customer confidence you might also get contacted by the FTC as it is checking out your bogus claims. Deceived customers are unhappy customers and they not only post reviews about your deception they contact the authorities.
The FTC Act prohibits unfair or deceptive advertising in any medium. That is, advertising must tell the truth and not mislead consumers. A claim can be misleading if relevant information is left out or if the claim implies something that’s not true. For example, a lease advertisement for an automobile that promotes “$0 Down” may be misleading if significant and undisclosed charges are due at lease signing.
In addition, claims must be substantiated, especially when they concern health, safety, or performance. The type of evidence may depend on the product, the claims, and what experts believe necessary. If your ad specifies a certain level of support for a claim – “tests show X” – you must have at least that level of support.
Sellers are responsible for claims they make about their products and services. Third parties – such as advertising agencies or website designers and catalog marketers – also may be liable for making or disseminating deceptive representations if they participate in the preparation or distribution of the advertising, or know about the deceptive claims.
If your web site designer or SEO consultant does not ask for substantiating proof of your claims they too can be held liable for misleading consumers with fraudulent offers. This is because they should know enough to sense and trust their instincts if something is “too” good to be true. If you hire me as a SEO consultant to get your site better rankings for your incredible new product that is guaranteed to grow hair,
Advertising agencies or website designers are responsible for reviewing the information used to substantiate ad claims. They may not simply rely on an advertiser’s assurance that the claims are substantiated. In determining whether an ad agency should be held liable, the FTC looks at the extent of the agency’s participation in the preparation of the challenged ad, and whether the agency knew or should have known that the ad included false or deceptive claims.
Internet professionals are also liable for copyright infringement because we are responsible for putting copyrighted material on a website. I always make sure that a client understands that I can only put graphics and content up that the client owns or has the written permission from the author.
Things that make the FTC go “Hmmmmm”:
Advertising Claims the FTC Will Focus On
The above claims should not be confused with the usual corporate declarations of superiority.
- World Renowned
- Global Leader
- Industry Leader
- Leading maker of “Insert Product Name Here”
- Long-Term Commitment
- Always Meet or Beat Expectations
- Corporate Culture Built on Continuous Improvement
- Blah, Blah, Blah (Does anyone even pay attention to this stuff?)
These types of claims won’t land you in trouble but will seriously bore the heck out of your potential customers. After all when someone visits your site they want a substantial reason to choose your product or service over the competition. Boring corporate pom pom waving won’t be nearly as effective as honest, factual information that gives your visitor the information they need to make a educated decision.