Why this matters.
The Federal Trade Commission’s Guides Concerning the Use of Endorsements and Testimonials in Advertising (16 CFR Part 255), updated in 2023, require clear and conspicuous disclosure of any material connection between endorsers and the brands they promote. This applies to influencer posts, affiliate links, paid reviews, employee testimonials, and even free product given in exchange for reviews. The FTC has increased enforcement significantly, sending warning letters to hundreds of companies and influencers and pursuing civil penalties against repeat violators.
The guides apply to businesses of all sizes and individual content creators. A ‘material connection’ includes any payment, free products, discounts, family relationships, or employment. Disclosures must be clear and conspicuous — not buried in hashtags, below ‘more’ buttons, or in ways that are easy to miss. The FTC’s updated 2023 guides added new requirements for AI-generated endorsements, fake reviews, and fake social media indicators. State consumer protection laws may impose additional requirements.