Huddled in front of a digital hearth on the third and final morning of the NAD Annual Conference, FTC Commissioner Terrell McSweeny participated in a cozy fireside chat about children’s marketing with ASRC President and CEO, C. Lee Peeler. The newest FTC Commissioner reported (or warned!) that she is closely following the evolution of marketing
Survey Says: NAD Panel Weighs in on Surveys
In contrast to a general emphasis on new data and new claims at the 2015 NAD conference, NAD staff attorneys, advertising lawyers, and survey experts took the time to weigh in about the emphasis NAD will continue to place on traditional best practices of consumer surveys for claim substantiation or challenge. Although online surveys programs allow survey experts to access pools of millions of respondents almost instantly, they also raise new issues regarding context and monitoring of responses. The panel made it clear that the ease and advantages of online surveys do not excuse survey experts from keeping in mind the same concerns that have undergirded survey evidence for the past fifty years.
In a presentation titled “Tiny Screens, Big Distractions: How Reliable is Your Online Consumer Perception Survey?”, David Bernstein of Debevoise & Plimpton, Kevin Goldberg of Nestlé Nutrition, Hal Poret of ORC International, and Annie Ugurlayan of NAD traced the history of survey evidence before the courts. In the 1960s, surveys were treated with extreme skepticism by judges, with the number used in Lanham Act litigation before 1975 stuck in the single digits. With the additional consideration given to expert testimony by the revised Federal Rules of Evidence in the 1970s, Bernstein explained, judges became more comfortable with surveys, eventually elevating them to the position of influence they hold today.
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A Conversation about Native Advertising, Editorial Integrity, and Brand Reputation
If there is one takeaway from yesterday’s panel on native advertising, it’s that sponsored content is not going anywhere in the foreseeable future. Although NAD has talked about it before, the FTC has held a workshop to address it, and of course, we’ve blogged on it, native advertising is still a hot topic. Native advertising, a form of sponsored content, is a fast-growing method for promoting products.
As explained by Diedre Sullivan, Senior Counsel to the New York Times Company, one of the threshold questions in sponsored content is whether the piece is, in fact, commercial speech. Under the umbrella of sponsored content are a number of types of native advertising, such as content written and provided exclusively by the advertiser, versus content created by the publication with subjects of interest to the advertiser but without the advertiser’s direct input (branded content), or content written jointly by the advertiser and the publication (sponsored content). If the content is exclusively editorial, it is afforded higher protection than commercial speech. However, the question for advertisers is not generally whether the piece is an ad but instead how to disclose.
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Getting Claim Substantiation Right
More, almost live blogging, from the NAD conference. During the mid-morning hours yesterday, the conference group focused on strategies to get their claim substantiation right. The panel of Kat Dunnigan (NAD); Rebecca Bliebaum (Tragon Corporation); Jay Goldring (Boots Retail USA, Inc); Spring C. Potoczak (Novartis Consumer Health, Inc.); and moderated by David Mallen (Loeb & Loeb, LLP) focused on the sufficiency of different types of claim substantiation.
The panel started the conversation by discussing how much substantiation is needed for a given claim. In other words, what constitutes competent and reliable scientific evidence. The panel said that randomized controlled trials (RCT) are generally thought of as the gold standard of support for advertising claims. However, the panel noted that RCTs are not required in all cases. In fact, David Mallen noted that the DC Circuit has said that RCTs are not necessarily the standard for advertising claim support. The NAD confirmed that it does not require any one type of test, reiterating that its standards for claim substantiation are flexible. RCTs are certainly accepted at NAD, but are not required. The NAD’s focus is on whether the advertiser’s support is sufficient and reliable. The NAD encouraged advertisers to simply provide the best evidence supporting the advertising claim, whether that evidence is a RCT or not.
The Absolute Best Puffery Panel Ever!
There is one phrase that sums up yesterday’s panel on puffery—puffery is f@#$*&% great. The panel started with a bang by jumping right into a video advertisement for dollar shave club where CEO and panelist Michael Dubin informed the audience (and the world) that the blades offered by dollar shave club are not good, they are f@#$*&% great. The panel’s energy did not stop there.
The panel dove into the age old question, how does one know when an advertising claim is a puff? The starting place for the panel was of course black letter law. The moderator, Terri Seligman from Frankfurt Kurnit, provided a thorough black letter definition of puffery—“an obviously exaggerated representation that is not objectively provable and that ordinary consumers would not rely upon in making a purchasing decision.” The panel consisting of Michael Dubin (Dollar Shave Club); Gabriel Martinez (Clorox); Ndidi Oriji (NBC Universal); and Laura Brett (NAD), then gave their impressions of puffery—especially, what they consider NOT to be puffery.
The first observation is that if the claim is measurable, it is not puffery. The panel discussed by way of example a Tropicana NAD case where Tropicana claimed its juice was the “World’s Best” juice. The NAD found that this claim was puffery because “World’s Best” was a general, non-measurable claim of superiority. The panel compared this case to a case where the claim “World’s Best Cat Litter” (Kent Nutrition Group, Inc. #5301) was challenged by Clorox. The NAD held that the claim was not puffery because it was made in conjunction with multiple measurable claims (ends odor the best, lasts longer, clumps the best, as green as green can be, you can eat the cat litter because it’s made from corn, among others). These claims are measurable and took what could have been a puffing claim and turned it into something that requires substantiation. The panel also noted that the advertiser did not participate in the NAD process in the Kent case and the advertiser was referred to the FTC, resulting in a closing letter.
Live From New York, It’s …The NAD Annual Conference
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
It’s Our Party and You Can Come If You Want Too (Again)
The annual NAD, and CARU conference on advertising issues begins next Monday September 29 in New York City. (For a link to the conference click here). We’ll be there and we suspect many of you will be too. We had so much fun at our party last year that we’re doing it again. So,
Striking Stats About Internet Marketing and Online Lead Generation
Online advertisers and marketers, including lead generators, and their service providers, have long had to contend with scrutiny from the FTC, state Attorneys General, competitors, and customers. And, since 2012, advertisers of consumer financial products and services have had to contend with the CFPB. Regardless of what you are promoting, bedrock advertising law says an advertiser can’t over promise, be misleading, or deceptive. Moreover, depending on how you advertise, you may have to comply with numerous medium specific requirements, such as the Telemarketing Sales Rule. Finally, some advertisers have to meet product specific regulations (e.g., consumer financial services laws). And, the list goes on. There are many ways for advertising to cause legal risk. But, what are some of the root causes? Survey says:
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Venable LLP’s 2014 Intellectual Property Symposium
Our colleagues in the Intellectual Property group have an upcoming event in Washington DC that we’re so excited about that we just can’t help plugging it here.
Venable is sponsoring a half-day IP- law symposium on Wednesday, September 10 at our Washington DC offices. Our Venable colleagues who are experts in areas such as
Upcoming Advertising Symposium
We try not to use this space for shameless self-promotion but we have an upcoming event in New York City that we’re so excited about that we just can’t help ourselves.
Venable is sponsoring a day long advertising symposium on Tuesday March 11th at the Vanderbilt Club in New York City. Now listening to us