Advertising, Marketing & Promotions Alert ... - Davis & Gilbert LLP

In its first action involving the social media site Pinterest, the Council of Better Business ... is described as a social photo-sharing ... Over the last six months, a.
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JULY 2012

ADVERTISING, MARKETING & PROMOTIONS

>> ALERT FIRST NAD ACTION INVOLVING PINTEREST In its first action involving the social media site Pinterest, the Council of Better Business Bureau’s National Advertising Division (NAD) determined that the consumer testimonials posted on Nutrisystem’s Pinterest board needed to include clear and conspicuous disclosures that comply with the FTC’s Guides Concerning the Use of Endorsements and Testimonials in Advertising (FTC’s Endorsement Guides). The NAD’s decision more broadly emphasizes that claims by companies on social media sites, such as Pinterest, are considered “advertising” and therefore must comply with general advertising laws and regulations.

PINTEREST Pinterest is a virtual bulletin board that is described as a social photo-sharing website, where users create and manage theme-based image collections by “pinning” digital content they find on the web to their personal boards. Over the last six months, a number of companies have created their own Pinterest boards to promote their products and services.

NAD CASE In April 2012, the NAD, as part of its routine monitoring program, noticed that Nutrisystem’s Pinterest board entitled, “Real Consumers. Real Success.,” featured photos of “real” Nutrisystem customers highlighting their weight-loss successes.  The customer’s name, total weight loss, and a link to the Nutrisystem website appeared below each photo.

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THE BOTTOM LINE Pinterest has become a new and rapidly growing way for companies to encourage consumers to engage with their products and drive traffic to their websites. Companies using Pinterest should ensure that all advertising on Pinterest and other social media sites complies with the FTC’s Endorsement Guides, as well as all other advertising laws and regulations, as failure to do so may result in regulatory or NAD scrutiny.

The claims at issue included: >>> “Christine B. lost 46 lbs. on Nutrisystem;” >>> “Michael H. lost 125 lbs. on Nutrisystem;” >>> “Lisa M. lost 115 lbs. on Nutrisystem;” and >>> “Christine H. lost 223 lbs. on Nutrisystem.” The NAD determined that the claims made on the Pinterest board touted atypical results, which were not representative of what consumers generally would achieve with Nutrisystem. When an advertisement touts atypical results, in accordance with FTC Endorsement Guides,

the advertisement should clearly and conspicuously disclose the generally expected performance in the depicted circumstances. Due to these reasons, the NAD determined that the Nutrisystem pins should have been accompanied by a “clear and conspicuous disclosure,” noting the typical results consumers could expect to achieve using the Nutrisystem weight loss program. Immediately upon receiving the NAD’s inquiry, Nutrisystem agreed that these statements required a disclosure and added the necessary disclosure (“Results not typical. On Nutrisystem®, you can expect to lose at least onetwo lbs. per week. Individuals are remunerated. Weight lost on prior Nutrisystem® program.”).

JULY 2012

ADVERTISING, MARKETING & PROMOTIONS >> ALERT It should be noted that if consumers browsing the Nutrisystem Pinterest board clicked on Nutrisystem’s consumer testimonial pins, they were redirected to Nutrisystem’s website, which included the necessary disclosures. However, the NAD explained that disclosures not only should be “clear, conspicuous and easy to understand,” but should be placed in “immediate proximity” to the

claim or representation it is intended to clarify. The NAD found that providing the disclosure on Nutrisystem’s website, which it observed consumers may or may not visit, was insufficient. In addition, the NAD noted that the space often used by users to post comments on a board is also often used by advertisers to include important information such as required disclosures.

FOR MORE INFORMATION Allison Fitzpatrick Partner 212.468.4866 afitzpat