FTC Targets Celebrity Endorsements

The Federal Trade Commission is putting the clamp down on testimonial advertisements and celebrity endorsements.

As first reported in The Wrap, the FTC announced today that it is revising guidelines given to advertisers on how to follow the rules of The FTC Act. The guidelines had not been updated since 1980 so this was a long overdue announcement.

Some of the new guidelines include full disclosure on fees and payments for posting blogs or appearing on morning news shows talking about a particular product. Also, advertisers will be required to use only people in their ads whose results are reflected by the majority of consumers buying the product. Before, advertisers could get away with using unusual test cases.

But the new rule that concerns Hollywood the most involves celebrity endorsements. Advertisers and endorsers will now be liable for false claims used by celebrities about their products or for failure to disclose payments or fees associated with endorsing a product. Also, as stated above, the revised guidelines make it clear that celebrities must reveal their partnerships with products when they go on television talkshows to endorse them.

-- Josh Marks