The FTC’s New Review Policy: What Does It Mean For Influencer Marketing?

Disclaimer: The information provided in this article is intended solely for general informational purposes and should not be considered legal advice. Compliance with FTC rules and guidelines is critical for brands and influencers alike. We strongly recommend that you consult with qualified legal counsel to address any specific questions regarding compliance with the new rules.

Earlier in 2024, the Federal Trade Commission (FTC) threw down the gauntlet with a bold new policy targeting fake reviews and deceptive testimonials, which just went into effect (as of October 21, 2024). This move reshapes not only general consumer trust but also has some major implications for brands and influencers who rely on social proof. In this guide, we’ll give a quick, no-thrills, breakdown of what the policy includes, why it matters for those in the influencer marketing game, and how brands and influencers can adapt to avoid the hefty fine that comes with violations.

What the New FTC Policy Entails

1. No Fake Reviews

The FTC now prohibits any fake, ghostwritten, or AI-generated reviews that misrepresent genuine consumer experiences. For brands and influencers, this means reviews must come from real people who have used the product. Content that mirrors real consumer sentiment is now a non-negotiable, shifting the focus to transparency in all testimonial content.

2. Paid Reviews Have a Catch

Incentivized reviews—where customers are offered something of value in exchange for their feedback—are permitted, but brands can no longer condition these incentives on positive feedback. Reviews must genuinely reflect the user’s experience, uncolored by compensation demands. Brands can still offer incentives for reviews, but no more nudging for only glowing feedback. 

3. Disclose Insider Reviews

Transparency time! If an employee, executive, influencer, or anyone with a “material connection” to the brand leaves a review, they must clearly disclose the relationship. This new rule aims to help consumers tell the difference between true user-generated content and insider endorsements. For influencers, this is a mandate to keep partnerships clear and transparent.

4. Be Transparent

The FTC is calling out brands with “independent” review sites that, well, aren’t. If a review platform is owned by or connected to a brand, it cannot portray itself as impartial. This ruling targets companies that may control review sites to present a biased view, underlining the need for authentic, user-generated content free from corporate influence.

5. Don’t Suppress Negative Reviews

Under the new rule, brands can’t hide the less-than-glowing reviews. Consumers are savvier than ever, and they’ll know if you’re sweeping criticism under the rug. Brands also can’t intimidate, threaten, or manipulate review displays. Instead, the rule encourages brands to own all feedback and let the truth be seen.

6. Avoid Fake Engagement

Buying or selling fake social metrics, such as followers or likes, is now prohibited if it misrepresents the influence of the brand or influencer. Artificially inflating social engagement metrics (i.e. likes, followers, etc) not only risks fines but undermines genuine influence. This shift means influencer partnerships need to be built on actual influence, not bot-padded numbers. The takeaway? Keep it real, or risk a hefty fine.

How This Impacts Influencer Marketing

Emphasis on Genuine Content

The new updates highlight the need for influencers to focus on authentic experiences with brands. With the prohibition of ghostwritten reviews, influencers must personally experience products and offer genuine endorsements. With authenticity taking center stage, influencers get to build real, long-lasting connections with their followers—no filler. 

Impact of Disclosure Rules

Transparency around endorsements and partnerships is now more essential than ever. Influencers must disclose if they received free products or compensation. Brands are also on the line to ensure influencers follow these rules, using clear, unambiguous language to indicate paid or gifted collaborations. Not only does this protect influencers from penalties, but it also boosts credibility and trust with their audiences.

Authentic Metrics and Avoiding Fake Follower Counts

For influencers and brands alike, maintaining accurate follower counts and engagement metrics has become a compliance requirement. Brands should prioritize partnerships with influencers who can bring real connections to the table, not just inflated numbers. This focus on authenticity will help build stronger, trust-based connections between influencers and their audiences.

Compliance Best Practices for Influencers and Brands

1. Clear Disclosure Policies 

Set clear guidelines on disclosures. Influencers should openly state partnerships using direct language like “#Sponsored” or “#Ad.” These disclosures shouldn’t feel hidden or subtle; clarity is key here, and your audience will appreciate the honesty. Pro tip: influencers can also verbally disclose partnerships in video content to comply with FTC guidelines.

This should be common practice at this point, so no need for changes if you’re already requiring this of your influencers.

2. Incentive Adjustments 

While incentivizing reviews is still allowed, brands should avoid offering rewards contingent on positive sentiment. The days of “five stars only” incentives are over–brands should encourage all types of feedback, letting the influencer express their true experience. Honest reviews not only resonate better but help build stronger credibility for brands and creators alike.

3. Review Transparency 

Brands should avoid manipulating or filtering reviews to favor positive feedback. Platforms like Instagram and TikTok, where customer comments function as reviews, should be managed ethically. This doesn’t just keep you compliant; it builds brand trust by showing that you’re not afraid to share all perspectives.

4. Content Verification and Review 

Brands need to regularly audit influencer content for compliance. This means verifying that influencers are using disclosures and avoiding tactics that artificially inflate follower counts. Educating influencers on the requirements of the FTC policy can prevent missteps and ensure both parties remain compliant.

Risks and Consequences of Non-Compliance

The penalties for breaching FTC rules are significant, with fines reaching up to $51,744 per violation. But the impact goes beyond financial loss; brands and influencers risk damaging their reputation and eroding consumer trust. Hypothetically, if a brand were found paying for undisclosed positive reviews or manipulating reviews to exclude negative feedback, it could face costly investigations, legal consequences, and a damaged brand image that would take years to rebuild.

Conclusion

The FTC’s updated policy on fake reviews is more than just a new set of rules; it’s a clear path toward more authenticity and transparency across the board. For brands and influencers alike, embracing these guidelines means building relationships on trust. And in today’s world, where consumers are savvy and the competition is fierce, trust isn’t just an asset—it’s everything.

Visit FTC.gov to stay up-to-date on the latest policy updates.

About the Author: Chase Fortune, Marketing Manager

With nearly a decade of experience in the industry, Chase is a seasoned marketing professional, adept in multiple disciplines from digital media planning & buying to account and project management. For the last three years, Chase has worked with AdParlor, first on the client account side, and now on the marketing side of the business. 

When he’s not planning his next big campaign for a client or researching the latest trends, you can most likely find him in his CrossFit gym 🏋️ or out on the mountain biking trails! 🚵