FTC (Federal Trade Commission) of USA has announced a new “Advertising Guidelines” applicable for endorsement of health products. Essentially this applies to advertisements which say in effect “I have used this product and found it useful”. It affects advertisements using celebrities to endorse products.
The guideline require that a disclosure to me made that the results claimed are “not to be considered as typical” and are relevant for compliance of HIPAA-HITECH by media owners.
Additionally, a blog who writes positively about a product is also considered as an “Endorsement” if he receives cash or in-kind payment to review a product.
The guidelines are reasonable and are issued in consumer interest. Probably it will bring more responsibility on the advertisers.
The principle is normally adopted as “Journalistic Ethics” in the financial circles. Some times a regulatory organization such as SEBI may impose penalties on any “Pump and Dump” attempts where endorsements are made for monetary considerations are prima facie fraudulent.
Endorsements in health products is mostly prevalent even in India through TV channels and products are brazenly over hyped. Probably the FTC guidelines may trigger some thoughts in India too about “Appropriate Disclosures” (Not banning) for advertisement of health products.