On the one hand, who likes big government? The FTC, Federal Trade Commission, sounds like the feds. Gear up your paranoia. On the other hand, who likes fake endorsements? And then — can I borrow your hand to make the third hand, please — wow! How can we resist highlighting this:
On Monday the FTC published a bulletin with the catchy title: Firm to Pay FTC $250,000 to Settle Charges That It Used Misleading Online “Consumer” and “Independent” Reviews. Here’s a summary, direct quote from that document:
The Learn and Master Guitar program promoted by Legacy Learning and Smith is sold as a way to learn the guitar at home using DVDs and written materials. According to the FTC’s complaint, Legacy Learning advertised using an online affiliate program, through which it recruited ‘Review Ad’ affiliates to promote its courses through endorsements in articles, blog posts, and other online editorial material, with the endorsements appearing close to hyperlinks to Legacy’s website. Affiliates received in exchange for substantial commissions on the sale of each product resulting from referrals.
I’m glad they got them. Fake endorsements are dishonest, they dilute real endorsements, they pollute the Web, and they tarnish the wisdom of the crowd. So hooray for the FTC, catching the spoilers who make it worse for everyone else. Get those evil-doers.
But then, wait, what was that? This is a more direct quote from the same document:
According to the FTC, such endorsements generated more than $5 million in sales of Legacy’s courses.
Now that worries me. I can subtract $250,000 from $5 million in my head, without needing an accountant or even a calculator. It comes to $4.75 million. What’s wrong with this picture?
My thanks to Anita Campbell who pointed on Twitter to Geno Prussakov’s blog post on this.
(Image: Oleg Golovnev/Shutterstock)
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