Federal Trade Commission issues online guidelines on customer reviews

This may be hard for some to imagine, but the Federal Trade Commission (FTC) feels right. This month, the agency released two guidance documents that follow best practices to prevent consumers from being misled when marketers solicit and pay for reviews online and when review platforms offer online customer reviews.

New material is like two sides of an old-fashioned vinyl album. Side A is for online retailers and marketers, while Side B is for review platforms (i.e. consumer review websites). The lyrics might be slightly different, but the tunes are a really good mix.

Side A hits:

In “Soliciting and Paying for Online Reviews: A Guide for Marketers,” the FTC highlights the importance of honest online reviews of products and services, and observes that bad actors undermine public trust with fake reviews and paying for better grades on supposedly independent ranking sites. However, there are ways to request and pay for reviews that improve online presence and avoid potential violations under FTC law.

  • Marketers should know if a platform prohibits or allows online reviews from reviewers who have received an incentive or have a financial or personal connection. (According to the FTC, any incentivized review must disclose this fact and must not be conditional on being positive.)
  • Marketers should not seek advice from: only customers who could give good reviews; those who have not used the product or service; friends and family who do not disclose their personal relationship as part of the review; or employees who fail to disclose both their employment status with the company and the fact that they have been asked to do reviews.
  • Marketers should also steer clear of comparison websites that offer payment-based ratings or reviews, exercise caution when working with certain reputation management companies that may use deceptive techniques (e.g., use fake reviews to help a business and hurt a competitor) and clearly disclose any business relationship with a review platform.

Now let’s flip the album over to side B:

In “Featuring Online Customer Reviews: A Guide for Platforms,” the FTC provides a baseline for how online platforms featuring online customer reviews should collect, moderate, and publish reviews:

  • Collection: Platforms should neither encourage positive reviews nor discourage negative reviews from submitting them.
  • Moderation: Platforms should consider all reviews (positive or negative) equally, retain their meaning, and use reasonable processes to weed out manipulated, false or misleading reviews.
  • Publication: Platforms must:

(1) display all “authentic” reviews;

(2) treat positive and negative reviews equally and display them with equal prominence;

(3) cause incentivized reviewers to clearly and prominently disclose their connection;

(4) clearly and prominently disclose the basis of aggregate ratings and explain how reviews are collected, processed and displayed; and

(5) use “reasonable procedures” that detect false reviews.

Behind these two guidance documents is the hope that marketers and platforms will work in perfect harmony to provide consumers with truthful and honest online reviews. Companies must do their best to keep pace with the FTC or keep up with the music.

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