We’ve all heard ads that make “up to” claims, such as “save up to 50%,” or “lose up to 10% of your body fat.” This post describes what these claims mean and how claim substantiation is conducted with these types of claims.
What are “up to” claims?
“Up to” claims, like other types of claims, are governed by the Claims Substantiation Principles set forth by the Federal Trade Commission. These principles for claim substantiation dictate that companies must be able to substantiate statements made in their advertising. In other words, if your company makes a claim about your product, it must be able to back up the claim.
An “up to” claim is a statement used to advertise a product containing the phrase “up to” in reference to an outcome generated by the product. Like other types of claims, the FTC’s position on “up to” claims is that before a company can make a statement about its product, the company must have a “reasonable basis” to support the claim.
What does the FTC say about “up to” claims and advertising substantiation?
The FTC’s definition of a “reasonable basis” depends on several factors relevant to claim substantiation. For example, the product, the type of claim, the cost of developing substantiation for the claim, the benefits of a truthful claim, the consequences of a false claim, and the definition of “reasonable” by experts in the field are some of the factors taken into consideration in claim substantiation (or advertising substantiation) matters.
The FTC’s position references a published study they commissioned in May 2012 examining how consumers responded to “up to” claims. The study was conducted in conjunction with an FTC matter involving five home window replacement companies who claimed their product would save homeowners “up to 47%” in energy costs.
According to the FTC, the study shows that when a company makes “up to” claims, many consumers are likely to expect that they personally will achieve the maximum “up to” results. This FTC ruling led the commission to implement a new standard on “up to” claims. As of today the FTC’s position is that marketers “who advertise these claims should be able to substantiate that consumers are likely to achieve the maximum results promised under normal circumstances.” In a future post, we will provide information about how the study was done and give our opinion.
Why is claim substantiation important to advertisers?
The FTC released the “up to” study to provide guidance to companies regarding how to make claims. They also sent out a clear message to advertisers to expect some scrutiny when using “up to” claims. Companies who use “up to” claims should proceed with caution and make sure that they have evidence to fulfill the “reasonable basis” requirement. Among other sources, such evidence can come from advertising substantiation surveys.
Dr. Bruce Isaacson
MMR Strategy Group