Misleading Endorsements Using Celebrity Names and Images

There have been instances of scam artists and dishonest business people misappropriating the name or image of celebrities and famous people to promote products and sell unreliable products or nonexistent services. Such campaigns often come and go quickly and are difficult to prevent. Other campaigns may use celebrity name variations or imply that a deceased person was a fan and supporter of a product.

It is reported that Babe Ruth was the first celebrity to make lots of money from product endorsements [12]. In fact, a search of Babe Ruth items on eBay shows him in numerous magazine ads for liquor, cigarettes, watches, beverages, baseball gloves, candies, and underwear. He died in 1948 and his image and name have been used in dozens of advertising campaigns since then, the legitimacy of all these campaigns has not been confirmed and his lifetime and after-death endorsement earnings are unknown.

The U.S. Federal Trade Commission (FTC) has received complaints and opened investigations into the false advertising of unproven products marketed by making false claims about their effectiveness. Some of these cases involved e-mail messages that appear to come from family members, friends, or other contacts. The e-mails had links to fake news sites that used celebrity names to promote products and make them appear legitimate [13].

Some advertising campaigns that have used celebrity endorsers have been found to be misleading. The Consumer Financial Protection Bureau (CFPB) conducted a focus group study on reverse mortgage advertisements that found many participants were left with misimpressions about the product. After viewing the ads, consumers were confused about reverse mortgages being loans, and they were left with the false impression that they are a government benefit or that they would ensure customers could stay in their homes for the rest of their lives. Many ads featured celebrity spokespeople discussing the benefits of reverse mortgages without mentioning the risks. Most consumers recalled TV ads that featured spokespeople portrayed as reliable and trustworthy. One consumer in one focus group said, “When it’s a former Congressman endorsing it, it makes it sound like a good idea” [14].

A study in the July 2016 publication Pediatrics examined the use of music celebrities by the food industry to endorse sugary soft drinks and nutrient-poor foods through multi-million-dollar campaigns. The study, “Popular Music Celebrity Endorsements in Food and Non-Alcoholic Beverage Marketing,” found 65 entertainers associated with the 2013 and 2014 Billboard Hot 100 chart that had one or more food and beverage endorsements between 2000 and 2014. The study also looked at the nutritional value of endorsed products and found 81% were unhealthy, according to the Nutrient Profile Index. No celebrities endorsed fruits, vegetables, or whole grains. Of the non-alcoholic beverage endorsements, 71% were for sugar-sweetened beverages, with only three endorsements for water or water-related products, such as a filter [15].

Endorsements are an important tool for advertisers and they can be persuasive to consumers. Several celebrity endorsers have run into unexpected difficulties as the products they were endorse became known for defects, associated with companies that are not in compliance with truth-in-advertising laws, or with companies found to be exploiting child labor in other countries.

The FTC publication “Concerning the Use of Endorsements and Testimonials in Advertising” provides guidelines designed to help advertisers of all types, including television, print, radio, blogs, word-of-mouth marketing, and social media, to make sure that they meet guideline standards. For example, advertisers are advised that using unrepresentative testimonials may be misleading if they are not accompanied by information describing what consumers can generally expect from use of the product or service. In addition, the Endorsement Guides let endorsers know “that they shouldn’t talk about their experience with a product if they haven’t tried it, or make claims about a product that would require proof they don’t have.” The Endorsement Guides also state that if there is a connection between the endorser and the marketer of a product that would affect how people evaluate the endorsement, it should be disclosed. The Endorsement Guides are not regulations, so there are no civil penalties associated with them. But if advertisers don’t follow the guides, the FTC may decide to investigate whether the practices are unfair or deceptive under the FTC Act [16]. The following is a list of headlines from a September 19, 2016 Web search of FTC cases that dealt with deceptive advertising:

  • ? Warner Brothers Settles FTC Charges It Failed to Adequately Disclose It Paid Online Influencers to Post Gameplay Videos (July 2016)
  • ? Operators of Phony Doctor Certification Program and Misleading Health and Lifestyle Websites Settle FTC Charges (June 2016)
  • ? FTC Approves Final Order Prohibiting Machinima, Inc. from Misrepresenting that Paid Endorsers in Influencer Campaigns are Independent Reviewers (March 2016)
  • ? FTC Sues Marketers Who Used Gag Clauses, Monetary Threats, and Lawsuits to Stop Negative Consumer Reviews for Unproven Weight-Loss Products (September 2015)
  • ? Xbox One Promoter Settles FTC Charges That It Deceived Consumers with Endorsement Videos Posted by Paid Influencers (September 2015)
  • ? FTC Halts Deceptive Marketing of Bogus Weight-Loss Products (May 2015)
  • ? FTC App roves Final Order Barring AmeriFreight from Deceptively Touting Online Consumer Reviews and Failing to Disclose Incentives It Provided to Reviewers (April 2015)
  • ? FTC Stops Automobile Shipment Broker from Misrepresenting Online Reviews (February 2015)
  • ? Sony Computer Entertainment America to Provide Consumer Refunds to Settle FTC Charges Over Misleading Ads for PlayStation Vita Gaming Console (November 2014)
  • ? Public Relations Firm to Settle FTC Charges That It Advertised Clients’ Gaming Apps through Misleading Online Endorsements (August 2010)
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