All's Not "Fair" in Advertising: Social Impact Product Marketing

by Proskauer Rose LLP
Contact

Advertising by consumer product companies that calls attention to the "green" benefits or "social impact" of products is on the rise, as the media, the Federal Trade Commission, and the National Advertising Division of the Council of Better Business Bureaus, Inc. ("NAD") have all recognized. Two recent NAD decisions highlight the importance of accurately communicating to consumers the extent to which an advertised product embodies those qualities because, as NAD wisely has recognized, "customers cannot easily verify for themselves whether social impact claims…are truthful or meaningful, [and] purchasers often rely on advertising, including certification marks, to determine what public interest benefits the product offers."[1]

This past summer, in two related NAD disputes,[2] TransFair USA and Avon Products, Inc. (which used TransFair marks in its advertising) were challenged by Dr. Bronner's Magic Soaps concerning the use of certain TransFair "Fair Trade Certified Ingredient" seals and statements on personal care and cosmetic products. Dr. Bronner's argued that these TransFair seals falsely communicated that the entire product, as opposed to specific ingredients, were fair trade certified, and that certain other fair trade advertising statements also communicated the message that entire products were fair trade certified when they were not. Dr. Bronner's also challenged the application of the "Fair Trade Certified Ingredient" and "Fair Trade Certified Ingredient-Specific" seals to products which contained only 2-5% fair trade certified ingredients (in accordance with TransFair's established standards), and argued that Avon, specifically, should be required to substitute fair trade ingredients, wherever possible, in its product compositions. As discussed below, NAD agreed in large part with TransFair and Avon concerning their advertising, but certain recommendations were made for revising statements used in connection with their fair trade claims.

TransFair, a nonprofit organization, audits and certifies fair trade products in the United States. The term "fair trade" is generally used to describe agricultural ingredients or products that are supplied by farmers in developing countries who have been paid a certain minimum price, whose workers are employed in accordance with recognized safe, healthful working conditions, and who commit to using environmentally-sustainable farming methods. These NAD disputes concerned personal care and cosmetic products that contained fair trade certified ingredients and were therefore eligible to use certain "Fair Trade Certified Ingredient" marks on their packaging. As explained in the NAD decisions, TransFair follows a specific policy of certification for personal care and cosmetic products whose manufacturers wish to use TransFair's "Fair Trade Certified Ingredient" and "Fair Trade Certified Ingredient-Specific" seals. Specifically, (1) "leave on" oil and wax based products must contain a minimum of 5% fair trade ingredients; (2) "wash off" products must contain a minimum of 2% fair trade ingredients; (3) for cosmetic products that contain more than one ingredient, all ingredients that can be fair trade certified must be fair trade certified; and (4) all fair trade certified ingredients must be clearly identified on the packaging.

In its decisions, NAD was careful to clarify that, since TransFair's certification process itself did not constitute national advertising, it was not appropriate for NAD to evaluate the standards or certification methods that TransFair employs.[3]  Instead, NAD evaluated the messages that were conveyed to consumers by use of the "Fair Trade Certified Ingredient" and "Fair Trade Certified Ingredient-Specific" seals (and other fair trade statements) on certain cosmetic and personal care products, including Avon products.

NAD found that although TransFair's "Fair Trade Certified Ingredient" and "Fair Trade Certified Ingredient-Specific" seals were closely similar in appearance to TransFair's "Fair Trade Certified" seal (which denotes an entire  product  comprised of fair trade ingredients), there was little potential for consumers to confuse these seals and believe that an entire product was fair trade certified. Importantly, the "Fair Trade Certified Ingredient" and "Fair Trade Certified Ingredient-Specific" seals appear alongside statements that make it clear which ingredients are certified, and consumers generally recognize that personal care and cosmetic products are composite products (i.e., comprised of several substances). Because TransFair requires that the fair trade certified ingredients be clearly identified on the advertising and packaging, it was unlikely that consumers would take away an implied message that these products are made entirely of fair trade certified ingredients.[4]

NAD further determined, however, that the TransFair authorized statements permitted for use on the product packaging (which often referred to the benefits of fair trade  products , not ingredients) should be revised to explain not only the meaning of fair trade, but also to make it clear to consumers that TransFair only requires that cosmetic and consumer care products contain 2-5% fair trade certified ingredients. In particular, concerning Avon's use of certain authorized TransFair statements, NAD recommended that the statements be modified to ensure that any fair trade references were narrowed to refer to particular ingredients, not  products  as a whole. To that end, NAD also examined Avon's print and Internet advertisements containing fair trade statements and found that several overstated the impact that its fair trade ingredient products (which are only required to contain 2-5% fair trade ingredients), had on the fair trade movement. Indeed, NAD found that certain statements could give consumers the impression that the majority of ingredients in the Avon products were fair trade certified, when they were not. In that respect, NAD recommended that Avon discontinue its use of certain demonstrative photographs and statements such as, "help change the world with four of the best body care products on earth," which implied the product's wide impact on the movement. NAD emphasized, however, that Avon was  not  prevented from advertising the fact that it incorporates Fair Trade Certified Ingredients or speaking generally about Avon's efforts to support the fair trade movement, particularly because print and Internet ads (unlike packaging) provide an advertiser with space to explain its statements in full detail.

These NAD cases serve as important reminders that while advertisers are encouraged to educate consumers and promote the socially responsible nature of their products, advertisers must also ensure that their claims send clear and accurate messages concerning the scope of that social impact.


[1] TransFair USA, NAD Case Report # 5337, June 2011.

[2]  TransFair USA, NAD Case Report # 5337, June 2011; and Avon Products, Inc., NAD Case Report # 5338, June 2011.

[3] For that reason, NAD similarly did not opine on Dr. Bronner's argument that Avon should be required to substitute fair trade ingredients in its product compositions. 

[4] Because Avon clearly marked its fair trade ingredients and used the appropriate corresponding ingredient seal marks, NAD found that consumers were not likely to be misled into thinking that Avon products were comprised wholly of fair trade ingredients.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Proskauer Rose LLP | Attorney Advertising

Written by:

Proskauer Rose LLP
Contact
more
less

Proskauer Rose LLP on:

Readers' Choice 2017
Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:
Sign up using*

Already signed up? Log in here

*By using the service, you signify your acceptance of JD Supra's Privacy Policy.
Custom Email Digest
Privacy Policy (Updated: October 8, 2015):
hide

JD Supra provides users with access to its legal industry publishing services (the "Service") through its website (the "Website") as well as through other sources. Our policies with regard to data collection and use of personal information of users of the Service, regardless of the manner in which users access the Service, and visitors to the Website are set forth in this statement ("Policy"). By using the Service, you signify your acceptance of this Policy.

Information Collection and Use by JD Supra

JD Supra collects users' names, companies, titles, e-mail address and industry. JD Supra also tracks the pages that users visit, logs IP addresses and aggregates non-personally identifiable user data and browser type. This data is gathered using cookies and other technologies.

The information and data collected is used to authenticate users and to send notifications relating to the Service, including email alerts to which users have subscribed; to manage the Service and Website, to improve the Service and to customize the user's experience. This information is also provided to the authors of the content to give them insight into their readership and help them to improve their content, so that it is most useful for our users.

JD Supra does not sell, rent or otherwise provide your details to third parties, other than to the authors of the content on JD Supra.

If you prefer not to enable cookies, you may change your browser settings to disable cookies; however, please note that rejecting cookies while visiting the Website may result in certain parts of the Website not operating correctly or as efficiently as if cookies were allowed.

Email Choice/Opt-out

Users who opt in to receive emails may choose to no longer receive e-mail updates and newsletters by selecting the "opt-out of future email" option in the email they receive from JD Supra or in their JD Supra account management screen.

Security

JD Supra takes reasonable precautions to insure that user information is kept private. We restrict access to user information to those individuals who reasonably need access to perform their job functions, such as our third party email service, customer service personnel and technical staff. However, please note that no method of transmitting or storing data is completely secure and we cannot guarantee the security of user information. Unauthorized entry or use, hardware or software failure, and other factors may compromise the security of user information at any time.

If you have reason to believe that your interaction with us is no longer secure, you must immediately notify us of the problem by contacting us at info@jdsupra.com. In the unlikely event that we believe that the security of your user information in our possession or control may have been compromised, we may seek to notify you of that development and, if so, will endeavor to do so as promptly as practicable under the circumstances.

Sharing and Disclosure of Information JD Supra Collects

Except as otherwise described in this privacy statement, JD Supra will not disclose personal information to any third party unless we believe that disclosure is necessary to: (1) comply with applicable laws; (2) respond to governmental inquiries or requests; (3) comply with valid legal process; (4) protect the rights, privacy, safety or property of JD Supra, users of the Service, Website visitors or the public; (5) permit us to pursue available remedies or limit the damages that we may sustain; and (6) enforce our Terms & Conditions of Use.

In the event there is a change in the corporate structure of JD Supra such as, but not limited to, merger, consolidation, sale, liquidation or transfer of substantial assets, JD Supra may, in its sole discretion, transfer, sell or assign information collected on and through the Service to one or more affiliated or unaffiliated third parties.

Links to Other Websites

This Website and the Service may contain links to other websites. The operator of such other websites may collect information about you, including through cookies or other technologies. If you are using the Service through the Website and link to another site, you will leave the Website and this Policy will not apply to your use of and activity on those other sites. We encourage you to read the legal notices posted on those sites, including their privacy policies. We shall have no responsibility or liability for your visitation to, and the data collection and use practices of, such other sites. This Policy applies solely to the information collected in connection with your use of this Website and does not apply to any practices conducted offline or in connection with any other websites.

Changes in Our Privacy Policy

We reserve the right to change this Policy at any time. Please refer to the date at the top of this page to determine when this Policy was last revised. Any changes to our privacy policy will become effective upon posting of the revised policy on the Website. By continuing to use the Service or Website following such changes, you will be deemed to have agreed to such changes. If you do not agree with the terms of this Policy, as it may be amended from time to time, in whole or part, please do not continue using the Service or the Website.

Contacting JD Supra

If you have any questions about this privacy statement, the practices of this site, your dealings with this Web site, or if you would like to change any of the information you have provided to us, please contact us at: info@jdsupra.com.

- hide
*With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name. Or, sign up using your email address.