By Bob Lilienfeld, Editor
Section 5 of the Act prohibits “unfair methods of competition” and was amended in 1938 to also prohibit “unfair or deceptive acts or practices.” A representation, omission, or practice is deceptive if: (1) it is likely to mislead
consumers acting reasonably under the circumstances; and (2) it is likely to affect
consumers’ conduct or decisions with respect to the product at issue.
How can you gauge if a claim is legitimate? Here are four simple guidelines:
1. Specific and detailed
The description must state exactly what is being claimed, by how much, and compared to what. For example, a product cannot simply claim to use less energy. It must state when the energy is being saved, by how much and compared to what.
Claims that are general or vague are not only considered to be meaningless, the FTC considers them to be deceptive. Technically, this means that claims which appear to be simple and harmless, such as “eco-friendly,” are open to scrutiny and legal action.
2. Clear, prominent & easily understood
According to the FTC, “Clarity of language, relative type size and proximity to the claim being qualified, and an absence of contrary claims that could undercut effectiveness,
will maximize the likelihood that the qualifications and disclosures are
appropriately clear and prominent.”
3. No overstatements
Claims that are not statistically significant should not be made. Further, unless recycling or composting is widely available (generally accepted to mean by at least 60% of households), it cannot be claimed without qualifying exactly where it can occur.
4. A clear basis of comparison
To claim that your product generates 25% fewer greenhouse gas emissions than a competitive prdouct, you must be able to state the emissions levels for both products and ensure that all data is both accurate and curent.
To learn more, see our Environmental Marketing Guidelines summary.
Eco-friendly. Good for the planet. Recyclable. Compostable. Biodegradable. What do these terms mean? Are they legitimate? Who's watching out for me?
According to the law, each of the claims just mentioned is not only meaningless, but possibly illegal. In fact, the rules governing the use of advertising claims have been around almost 100 years: The United States Congress passed the Federal Trade Commission Act of 1914, establishing its namesake, the FTC.