National Advertising Division Finds The Coldest Water, LLC Takes Appropriate Measures to Disclose Material Connections in TikTok Influencer Advertising
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New York, NY – November 16, 2021 – The National Advertising Division (NAD) of BBB National Programs determined that appropriate efforts were made by The Coldest Water, LLC to ensure that its influencers’ material connections were disclosed in TikTok videos for its Coldest Water bottle.
In June 2021, through its ad monitoring program, NAD inquired about numerous TikTok videos by influencers featuring a reusable, insulated Coldest Water bottle. The case was initially referred to the Federal Trade Commission (FTC) for review due to the advertiser’s failure to respond to NAD’s request to provide support for its claims. After this referral, The Coldest Water, LLC decided to engage with NAD’s self-regulatory process and made modifications to its advertising.
The advertisements in question were posted on the social media platform TikTok by various social media influencers. In each video, a Coldest Water bottle was displayed prominently somewhere in the foreground or background so that the brand logo can clearly be seen, but the product itself is not mentioned or referenced by the influencer. The challenged videos use the hashtag “#thecoldestwater” and tag the company (@thecoldestwater), but do not include any material connection disclosures to the company.
In its initial inquiry, NAD questioned whether consumers would take away a message that influencers placing Coldest Water bottles in videos are endorsing the product and that such influencers have a material connection with the company making the endorsed product. According to the FTC Guides Concerning the Use of Endorsements and Testimonials in Advertising, “when there exists a connection between the endorser and the seller of the advertised product that might materially affect the weight or credibility of the endorsement (i.e., the connection is not reasonably expected by the audience), such connection must be fully disclosed.”
Because the advertiser was not aware of existing relationships between the company and any of the influencers in the specific TikTok videos cited in the case, NAD was persuaded that these videos did not constitute endorsements of the company’s product.
In addition, the advertiser explained to NAD that it does not suggest that influencers post about its product in order to receive sponsorships. The advertiser also provided NAD with excerpts of its social media policy pertaining to compliance with FTC laws and regulations. Finally, the advertiser explained that it provides its sponsored influencers, all of whom are “invite-only,” with social media guidelines stating that if the influencers promote the company in any way in exchange for money or bottles, they must disclose their relationship per FTC regulations. According to the advertiser, compliance is monitored by a team of employees.
NAD noted its appreciation for The Coldest Water LLC’s efforts to ensure that its influencers comply with applicable rules and regulations concerning the disclosure of any material connections with the company in sponsored TikTok videos.
NAD also inquired about a page of the advertiser’s website entitled “How Can I Promote the Coldest Water,” based on its concern with language indicating that The Coldest Water, LLC was actively encouraging influencers to post about its products on TikTok in exchange for a potential sponsorship opportunity. The advertiser stated that this webpage was not actively promoted to the general public and typically only provided to influencers with existing contractual relationships with the company, however it voluntarily agreed to discontinue the claims about promoting the product on TikTok.
In its advertiser statement, The Coldest Water, LLC stated that it “agrees to comply with NAD’s recommendations.”
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About the National Advertising Division: The National Advertising Division (NAD) of BBB National Programs provides independent self-regulation and dispute resolution services, guiding the truthfulness of advertising across the U.S. NAD reviews national advertising in all media and its decisions set consistent standards for advertising truth and accuracy, delivering meaningful protection to consumers and leveling the playing field for business.
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