The FTC Is Sniffing Out Fake Testimonials Online

NEW YORK — An endorsement or testimonial from current or past clients can help you stand out, particularly online. However, the Federal Trade Commission has some guidance for how to use them in your business.

This year, the FTC released new guidance about including endorsements or testimonials in your digital marketing, including social media and online reviews. In particular, the FTC wants to sniff out fake reviews. The commission has already gone after some companies, including real estate brokerages, accusing them of violations—which can carry a maximum fine of about $50,000 per violation. A rental listing platform, for instance, was recently accused of paying for tens of thousands of fake online reviews to gain more prospective tenants.

“It’s important that real estate professionals understand how to properly incorporate testimonials into their marketing strategy and be familiar with the Federal Trade Commission’s latest guidance,” Maame Nyamekye, an associate counsel with the National Association of Realtors®, says in the latest “Window to the Law” video.

Nyamekye offers tips in the video on how to use testimonials and endorsements in your business:

• Ensure any endorsement you post is truthful and not misleading. “Endorsements should always reflect the individual’s honest opinion, belief and experience of your services,” Nyamekye says.
• Wherever you post testimonials, include a disclosure that the customer experience with your services can vary from one person to another.
• Be upfront about any connection between your business and the person writing the review, and note whether the person was paid to post a review.

Learn more about how to use reviews in your business with these resources:

• The Power of Testimonials and How to Ask for Them — Customer testimonials and reviews are a powerful (and free) marketing tool, which means they should be top of mind for every real estate professional. Start the conversation about reviews and testimonials early with your clients.
• Smarter Ways to Collect and Use Testimonials — Client testimonials are crucial to building a robust real estate brand, but you need to learn how to collect and use them correctly in order to get the most out of this vital marketing asset.

© 2023 National Association of Realtors® (NAR)