Megan Graham wrote an article for the Wall Street Journal titled $5 for a Good Online Review? No Way, Says New FTC Rule (29 August 2024).
« The Federal Trade Commission inked a new rule to combat fake online reviews and sham social-media clout. The new rule, finalized this month and set to go into effect later this year, prohibits a slew of practices including:
- providing incentives for reviews that convey a particular sentiment
- reviews and testimonials by company insiders that don’t disclose the authors’ connection to the brand
- suppressing unflattering reviews
- reviews and testimonials attributed to people who haven’t used the product or aren’t real »
« Federal Trade Commission rule also bars brands from seeking clout by buying followers »
« The FTC will be able to seek a $51,744 fine per violation. The agency has investigators and consumer protection staff attorneys who look into allegations and take action when they deem appropriate. »
« The new rule prohibits buying fake indicators of social-media influence, such as followers or views made by a bot or hijacked account, to inflate the importance of a brand or product for commercial purposes. »
« “Social proof is such a cornerstone of marketing, and every business wants to have it, especially at the early stages of a business or even launching a new product line,” said Robert Freund, an attorney focused on advertising and e-commerce issues at Robert Freund Law. The rule against faking such proof has taken a lot of people by surprise, according to Fruend, even though the FTC has been challenging the practice for years. »
« “If you’re hosting consumer reviews on your brand site, you can’t filter out the one- and two-star reviews. You have to show all of the reviews,” Freund said. »
« Marketers can still be challenged for some forbidden practices even if they “should have known” of such activity. Some marketing groups had tried to keep that additional legal burden out of the final rule. »
Articles of Interest 