NAD Reviews Social Media Endorsements


In a case of first impression, the National Advertising Division of the Council of Better Business Bureaus (NAD) - the advertising industry's self-regulatory forum - considered social media promotions, social media endorsements, and what it means when a company advertises that Facebook users "like" it. Specifically, NAD evaluated (1) an advertiser's offer for "free glasses" to people who "like" the advertiser's product (which NAD termed a "like-gated" promotion), and (2) the advertiser's statements about how many people "like" its products (which NAD said is an endorsement). NAD investigated the statements made by Coastal Contacts, Inc., after a competitor, 1-800 Contacts, filed a challenge with NAD.

Coastal Contacts offered the following promotion on its Facebook page: "Like This Page! So you too can get your free pair of glasses!" Coastal Contacts also made statements on its Facebook page and in press releases about how many people "like" its products. 1-800 Contacts challenged the promotion by arguing that Coastal Contacts should have disclosed the material terms and conditions in conjunction with the offer, such as consumers would be charged shipping and handling charges, not all styles of glasses were available as part of the promotion, and only a certain number of glasses would be given away as part of the promotion. 1-800 Contacts also challenged statements about how many people "liked" Coastal Contacts' products, arguing that such statements were fraudulent endorsements because some consumers may have "liked" the products in order to qualify for the promotion.

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