NAD Recommends Applegate Discontinue Certain Claims for Cellulose Insulation; Finds Company can Support Certain Claims

New York, NY – June 13, 2016 – The National Advertising Division has recommended that Applegate Insulation discontinue certain claims for the company’s cellulose insulation products, but found the company could support its “R-value per inch” claims.

NAD is an investigative unit of the advertising industry’s system of self-regulation. It is administered by the Council of Better Business Bureaus.

The claims at issue in this case were challenged by the North American Insulation Manufacturers Association (NAIMA.) NAIMA objected to comparative performance claims, made throughout Applegate’s advertising, that cellulose insulation provides superior energy savings over fiberglass insulation, resulting in consumers having significantly reduced heating and cooling bills.  Applegate maintained that it has a reasonable basis for its energy savings claims based on the findings of three studies – the Colorado Study, the Leominster, Massachusetts Study, and the Oak Ridge Study.

Following its review of the advertising and advertiser’s evidence, NAD determined that one of the reasonable messages conveyed by comparative performance claims which specifically reference “studies” is that consumers will actually experience the same energy savings as reported in these studies.  In this case, NAD found the advertiser’s evidence insufficient to support the challenged comparative performance claims and recommended the advertiser discontinue the following claims:

• “[I]f one type of insulation is more effective than another, it can help save even more money (and energy). Studies at universities, national laboratories, private research facilities and hundreds of homes and buildings have shown that cellulose is from 20% to 50% more effective than fiberglass.”
• “A study by the Leominster Housing Authority demonstrates how using Applegate can reduce the load on your heating bills by as much as 32%! We’re so confident that you’ll save money using Applegate insulation that we’re even willing to guarantee it.”
• A set of two side-by-side charts appearing under the heading “Applegate Cellulose helps keep your home warmer in the winter, cooler in the summer, blocks air infiltration, and saves you money!”
• “Extensive and expensive air sealing measures must be used for fiber glass buildings to approach the tightness of buildings insulated with cellulose. The extra expense may yield few benefits. In a Massachusetts survey the cellulose insulated building still consumed 32% less energy for heating than buildings insulated with fiberglass, even after extensive air sealing of all the buildings was done.”
• “Applegate Cellulose insulation can reduce your utility bill by up to 40%.”
• Applegate Cellulose “is more effective at reducing energy costs than [fiber] glass.”
• “Pound for Pound Applegate Cellulose Insulation is more effective at reducing energy costs then glass . . . .”

NAD recommended that Applegate discontinue the unsupported claims that “Some studies have shown boron might lower the risk of some cancers and is a chemical commonly found in vegetables such as almonds, apples … and pears, according to BoraxPioneer,” and the claim that “The fire retardant additives used to manufacture Applegate are non-toxic. One of the additives, boric acid, is six times less toxic to humans than table salt!”  NAD noted, however, that nothing in its decision precludes Applegate from making an appropriately qualified truthful claim about the safety of its product, provided that it refrains from making categorical “non-toxic” claims.

NAD recommended that Applegate discontinue the unsupported claim that “Applegate Insulation quiets a home better than fiberglass by reducing air infiltration through wall cavities. Applegate Cellulose completely fills the intended space making it difficult for sound to pass,” and a graph depicting the superior acoustic performance of cellulose over fiberglass batts.  NAD also recommended the advertiser discontinue a challenged “sound bucket” demonstration.

NAD determined Applegate provided a reasonable basis for its “R-value per inch claims,” noting that the evidence in the record supports a finding that Applegate’s cellulose insulation meets the exception to the FTC’s R-value rule and therefore, Applegate is not prohibited by that rule from making “R-value per inch” claims.

Applegate, in its advertiser’s statement, said the company “will take NAD’s recommendations into account for current and future advertising materials.”

Note: A recommendation by NAD to modify or discontinue a claim is not a finding of wrongdoing and an advertiser’s voluntary discontinuance or modification of claims should not be construed as an admission of impropriety. It is the policy of NAD not to endorse any company, product, or service. Decisions finding that advertising claims have been substantiated should not be construed as endorsements.