FTC Enforcing Advertising Guidelines Against “Pay-for-Praise”

The recent announcement of an FTC settlement with a company called AmeriFreight that was paying customers to write reviews, then trolling for new customers by pointing to its favorable online ratings, brings to mind the controversy a few years ago about the FTC's amendments of its advertising guidelines to apply to misleading use of online comments.  This strikes me as just the sort of enforcement that we want the FTC to be undertaking.

The program that has now been shut down did not expressly condition payment on the writing of favorable reviews; the company rewarded its customers with a $50 discount if they wrote an online review (or two reviews, the complaint uses this figure as well), then promised to consider them for an addition $100 reward given to the review selected as having the "most captivating subject line" and "best content."  Apparently, some of the online reviews disclosed the reward system, but the majority did not, and the company's touting of the reviews did not.

It remains to be seen whether the FTC pursues a "pay-to-praise" case without the subsequent advertising that touts the resulting praise.

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