Thursday, January 28, 2010

Direct Marketing Association Releases New Guidelines for Endorsements, Testimonials

This posting was written by William Zale, Editor of CCH Advertising Law Guide.

The Direct Marketing Association (DMA) announced on January 25 that its Board of Directors has approved recommended changes to DMA’s Guidelines for Ethical Business Practice for testimonials and endorsements in all channels.

DMA developed and recommended these amendments to keep the guidelines consistent with the Federal Trade Commission’s Guides for Testimonials and Endorsements, as revised in October 2009. (For further information on the FTC guides, see Trade Regulation Talk, October 5, 2009.)

Typical Results/Performance

Under DMA’s new Guidelines, marketers must clearly and conspicuously disclose the generally expected or typical results/performance of the advertised products or services, if the claims made are not typical of what a user could expect under normal circumstances.

This requirement contrasts with the previous version of DMA’s Guidelines and the 1980 version of the FTC Guides, both of which allowed marketers to describe unusual results in a testimonial as long as they included a disclaimer such as “results not typical.” DMA’s revised Guidelines and the FTC Guides no longer allow for this safe harbor.

Endorser Disclosures

DMA’s revised Guidelines also reinforce the need for marketers to disclose any material connections between marketers and their endorsers that the consumer would not expect.

A material connection refers to a connection between the endorser and marketer that materially affects the weight or credibility of the endorsement, such as payments or free products or an employer/employee relationship. This includes endorsements that are conveyed by bloggers or other “word-of-mouth” marketers.

Celebrity Endorsements

DMA’s Guidelines also address celebrity endorsements. Marketers should ensure that their celebrity endorsers disclose their relationships with marketers when making endorsements outside the context of traditional advertisements, such as on talk shows or in social media, and they should not knowingly make statements that are false or unsubstantiated.

Blogs, Social Networking, Word-of-Mouth Marketing

The Guidelines apply to both traditional and new interactive media, including but not limited to social networking sites, online message boards, blogging, and “word-of-mouth” marketing. The Guidelines are enforced by the DMA’s Committee on Ethical Business Practices through its casework process.

Further details on the revised DMA guidelines will appear in Do’s and Don’ts in Advertising and CCH Advertising Law Guide.

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