NAD’s Monitoring Priorities: A Reminder to Carefully Vet Health Claims and Influencer-Based Ads

As the Federal Trade Commission (FTC) and Food and Drug Administration’s (FDA) enforcement priorities face potential shifts under the incoming administration, marketers should keep in mind that their advertising claims — especially those involving health and safety — will continue to be closely monitored by the National Advertising Division (NAD) of BBB National Programs. The NAD operates as an independent body overseeing advertising self-regulation, addressing disputes between competitors, and proactively launching challenges as part of its routine monitoring process to ensure advertising integrity. With respect to its monitoring, the NAD has particularly focused on health and safety claims, as well as influencer-driven marketing.

Recent cases demonstrate this focus. For example, the NAD reviewed Drip Hydration’s Ketamine IV Therapy ads, which claimed to treat mental health issues such as depression and post-traumatic stress disorder. In response to the NAD’s challenge, the advertiser agreed to discontinue these health claims. Similarly, the NAD challenged Drunk Elephant, a skincare brand, for asserting claims relating to its products’ safety for tweens and teens and efficacy in addressing acne. While the brand substantiated its safety claims, it voluntarily discontinued the efficacy statements. It is also worth noting that Drunk Elephant is the latest in a series of cosmetic companies that the NAD has targeted for its routine monitoring challenges.

Notably, the NAD also flagged Drunk Elephant’s influencer marketing for inadequate disclosure practices. In particular, the NAD cited a failure to clearly communicate material connections between the brand and its influencers. Drawing on the FTC’s Endorsement Guides, the NAD recommended adjustments, such as ensuring hashtags like #drunkelephantpartner are clearly visible without having to click on a hyperlink, separated to be more legible, and prominently placed in posts and videos.

The NAD’s cases are an important reminder to continue closely vetting all of your health and safety claims to confirm they are backed by competent and reliable scientific evidence and ensure all influencer-based marketing complies with the FTC’s Endorsement Guides, including by clearly and conspicuously disclosing material connections. While the NAD’s self-regulatory process is voluntary, marketers should note that a refusal to participate in the process or to comply with the NAD’s recommendations will be publicized in an NAD press release and results will be referred to the appropriate regulatory agency, including the FTC and FDA.

© Arnold & Porter Kaye Scholer LLP 2024 All Rights Reserved. This Blog post is intended to be a general summary of the law and does not constitute legal advice. You should consult with counsel to determine applicable legal requirements in a specific fact situation.