Why brands should verify their marketing claims
Today, water filter brands can either rise to the top or sink to the bottom of consumer consideration based on marketing claims. A strong brand value proposition coupled with a differentiating marketing claim can help catapult products off the shelf. A weak, invalid or unsubstantiated claim can cause a brand to suffer greatly, and negatively impact sales or brand reputation. So, what are the areas to be considered when working to develop marketing claims?
Truth in Advertising
Let us start with rules and regulations. The Federal Trade Commission (FTC) has guidelines under the FTC Act that state advertising must be truthful and nondescriptive; advertisers must have evidence to back up their claims; and advertisements cannot be unfair.
In relation to claims, the FTC looks at both express and implied claims. Express claims are ones that are directly stated in the advertisement. For example, “XYZ water filter prevents getting sick from public water” is an express claim. Implied claims are made indirectly or by inference, such as “ABC water filters remove bacteria that can cause sickness.” In both instances, there must be sufficient evidence to support the claims’ validity.
In most cases, advertisements that make health or safety claims must be supported by “competent and reliable scientific evidence,” according to the FTC. They can be in the form of tests, studies or other scientific evidence that have been evaluated by qualified professionals. In addition, any tests or studies must be conducted using methods that field experts accept as accurate. This can be done through internal testing and validation or through a nonbiased, third-party testing company.
An invalid, inaccurate or unsubstantiated claim in the marketplace can cost a brand financially, as well as damage their reputation. Sometimes, the damage can be irreversible. An FTC cease-and-desist order will require a brand to pull their advertisements immediately, report periodically on the substantiation of new claims in new advertisements, and pay a fine of $42,5301 per day, per advertisement, if the company violates the law in the future. Civil penalties can cost companies up to millions of dollars in settlements.
In 2010, Dannon settled a lawsuit over claims for their Activia and DanActive brands. Sold at a 30% premium over other brands, they claimed that special bacterial ingredients that the company advertised as “clinically proven” helped strengthen immune systems and regulate digestion. A judge ruled the brands were making unproven claims. In the end, the settlement cost the brand $45 million.
Outside of the FTC, other organizations also can contribute to the policing of advertising claims. In 2015, Sawyer products were advised to discontinue the use of their claims by the National Advertising Division (NAD). The company claimed their water filter could produce “1 million gal guaranteed of clean, drinkable water tested and verified by the United Nations.” The NAD found that the testing provided by Sawyer was insufficient, unsubstantiated, and in some instances, unproven in relation to other claims.
Benefits of Validated Claims
The right claim can lead to stronger sales, heightened brand awareness and category leadership. A brand can make their product or service stand out significantly from the competition, if the claim is compelling enough. Third-party validation and verification of claims also can be a powerful tool to demonstrate that brands are making accurate, truthful and credible claims. By emphasizing a benefit or positive aspect of a product or service, brands help to reassure skeptical or first-time buyers considering a purchase, which can widen their consumer base.
As mentioned above, there are different classifications of claims, according to the FTC. There also are claims that can be covered by industry standards. If the product is certified to an industry standard, the manufacturer should be aware of what claims are covered by the scope of the standard, and which ones need separate verification. When separate verification is needed, consider using a third party to back your claims. An independent party, such as a Testing, Inspection and Certification agency (TIC), can offer a non-biased review. They can help ensure the claim language is clear, credible and substantiated by test data. A TIC agency-backed claim can add credibility in the eyes of government agencies, buyers and consumers. It is essential that no matter the goal of the claim, brands should take extra precautions when it comes to substantiating and validating their claims.
Water filtration plays an important role in consumers’ everyday lives. As humans continue pursuing healthy lifestyles, water filtration brands will continue marketing toward cleaner, better, faster and more often. This can expose brands to greater claim risks, which is why it is important to check all the boxes before going to market.