How the FTC's fake review rule impacts ecommerce stores

Stuart -

As of October 21st, 2024 the FTC has put into effect its “final rule” banning fake online reviews & testimonials. Much of the new rule is updating & clarifying previously existing rules to explicitly call them out as fraud. It is also clear the FTC plans to enforce this rule — they are actively solicitation reports of abuse & plan to “seek civil penalties against knowing violators”.

The rule is one we largely agree with. Fraudulent review practices waste customers' time & hurt honest businesses – this new rule is an important step to maintain the integrity of consumer reviews. But it does put a burden on businesses to understand & make sure they are operating in-line with the new rule.

What does the FTC's fake review rule actually prohibit?

While we can't cover everything in the rule (the rule itself is 163 pages long) here, the FTC breaks the new rule out into the following categories:

  • Fake or False Consumer Reviews, Consumer Testimonials, and Celebrity Testimonials
  • Buying Positive or Negative Reviews
  • Insider Reviews and Consumer Testimonials
  • Company-Controlled Review Websites
  • Review Suppression
  • Misuse of Fake Social Media Indicators

All of these have direct implications for consumer brands. The particular areas that apply to how you use Junip (or other review platforms) are: "Fake or False Consumer Reviews", "Buying Positive or Negative Reviews", "Insider Reviews" and "Review Suppression".

Fake or False Consumer Reviews

This one is easy. You cannot create or purchase fake reviews for your products. The rule also makes clear consumers cannot create false reviews for products they have no experience with. That means you cannot create and submit reviews yourself & you absolutely cannot upload fake reviews to your review platform via import.

Buying Positive or Negative Reviews

You cannot make an incentive (ie discount) conditional on the review being positive. If customers get a $10 discount for leaving a review... they get that discount even if they submit a 1-star review.

Insider Reviews

If you (or your employees) are leaving a review for your own company or products, you need to disclose that relationship in the review itself.

Review Suppression

You cannot suppress reviews based upon their ratings or negative sentiment (ie hiding 1-star reviews). You also cannot threaten users into removing their review.

So what do businesses need to do?

If you're abusing reviews – stop. If you're not, you might need to still triple check your team's day to day practices (especially as it relates to incentivizing reviews as well as responding to negative reviews) to make sure they're fully compliant.

Junip is already set up to be in-line with these guidelines, but our moderation (watching out for inappropriate reviews) & migration (moving reviews from a previous vendor) features do have a bit of room for bad actors on your team to potentially put you at risk if they choose to abuse these tools.

We have updates in beta to completely remove any concerns related to the new rule from your plate (and ensure you stay fully complaint). If you'd like to be a part of the beta – please email stuart@juniphq.com.