Well, not quite live. This week we’ll be providing updates from the NAD Annual Conference, which kicked off today in New York. The keynote address was given by FTC Commissioner Julie Brill, who reminded the audience that while the advent of the internet age and social media has radically changed how advertisers market their products and services, the basic principles of truthful and non-deceptive advertising have remained the same for over 100 years: advertisements must provide consumers sufficient information to make meaningful purchasing decisions.
Commissioner Brill highlighted three areas that the FTC is laser focused on:
- Endorsement disclosures: Commissioner Brill described what she referred to as the “democratization of truth,” where online user reviews are as ubiquitous as banner ads and can be referenced for virtually every purchasing decision a person makes. She warned that material connections between the blogger / reviewer and the advertiser are necessary and that advertisers cannot hide behind the “aura of authenticity” that user-generated reviews offer.
- Advertising technology and consumer privacy: While recognizing that the use of big data to better tailor advertising can be good for consumers, Commissioner Brill expressed disappointment that industry self-regulation has not kept up with changing technologies. She cited marketers’ use of retail mobile location tracking and device fingerprinting, which allows marketers to track consumers across devices, as examples. She reminded marketers that providing consumers more control over the data that is collected from and about them makes business sense too. Otherwise, consumers will take matters in their own hands, as demonstrated this month when Apple released its latest operating system, which permits users to block advertisements. Within a day of the release, multiple ad-blocking apps shot to the top of paid app downloads worldwide.
- Claims of health benefits of online games and apps: Citing several recent enforcement actions, Commissioner Brill took aim at marketers of online games and apps that claim to detect diseases or to improve health functions, such as cognitive development. She made clear that the FTC will not tolerate disease prevention or treatment claims that are not properly substantiated, including through, where appropriate, competent and reliable scientific evidence using randomized human clinical trials.
In closing, Commissioner Brill implored marketers to harness their creativity to come up with innovative solutions to the compliance challenges presented by smaller screens and device connectivity.
Tune in for more postings and updates from the NAD Annual Conference; and read our recent post “FTC Goes After Marketer for Unfair Consumer Gag Clause.”