Read about the BBB’s standards for honest and fair business ads
These basic advertising standards are issued for the guidance of advertisers, advertising agencies and advertising media. It is impossible to cover fully the wide variety of advertising practices by specific standards in a code such as this, which is designed to apply to the offering of all goods and services in all forms of media.
Note: To learn more about each standard, click on “Click here for specifics” to read the entire text for that item (on the BBB website).
BBB Code of Advertising – Summary
Each section of the BBB Code of Advertising is summarized here to help you select the parts of the Code that apply to your specific situations. Please click at the end of a paragraph to access the entire section in detail or click here to go directly to the full text version.
1. Basic Principles of the Code
Advertisements should be truthful, sincere offers to sell. Advertisers have a responsibility to have substantiation for all claims made and should be able to provide that substantiation upon request. All advertising that may mislead or deceive consumers should be avoided. Click here for specifics.
2. Comparative Price, Value and Savings Claims
When comparing prices to one’s own former selling price, current price of others, list prices, wholesale prices, or to items which are imperfect, it is important to make sure that consumers have all the necessary information to make an informed purchase. In addition, when offering a price match guarantee, the offer should be made in good faith, include all necessary information to take advantage of it and not place an unreasonable burden on the consumer who wants to take advantage of the offer. Click here for specifics.
3. Comparison with own former selling price
When comparisons are made to a former selling price, it must be to a bona fide price that has been offered for a reasonable time. If no sales had been made at that price, the advertiser must be sure that the markup on the higher priced product is similar to other products. Click here for specifics.
4. Comparison with current price of identical products or services sold by others
Advertisers must be reasonably certain that the compared to price does not appreciably exceed the price at which substantial sales for the identical product have been made. Click here for specifics.
5. Comparison with current price of comparable products or services sold by the advertiser or by others
Advertisers must be reasonably certain that the compared to price does not appreciably exceed the price at which substantial sales for the comparable product have been made. Click here for specifics.
6. List Prices
List prices comparisons may mislead the consumer where they are not to a price at which substantial sales of the product have occurred. An advertiser can use a list-price non-deceptively where it does not claim a savings, and includes certain disclosures. Click here for specifics.
7. Imperfects, Irregulars and Seconds
A price comparison to an imperfect product must include a clear disclosure, among others, that such comparison applies to the price of the product if perfect. Click here for specifics.
8. “Factory to you,” “factory direct,” “wholesaler,” “wholesale price”
Such phrases are appropriate under certain circumstances. For example, the phrase “factory to you” can be used where the advertiser actually makes the product. The phrase “wholesale price” can be used if that price is comparable to the price charged by wholesalers. Click here for specifics.
Retailers can advertise “sales” where they are offering a significant reduction in price for a limited period of time. At the end of the sale period, retailers can, in good faith, convert the sale price to a new regular price if they no longer claim a savings. Click here for specifics.
10. “Emergency” or “Distress” sales
Emergency sales must be for a limited period of time, and only include products that are affected by the emergency. The reason given for the sale must be true. Advertisers stating they are closing out a particular product can do so where the advertiser will no longer carry that product. Click here for specifics.
11. “Up to” price savings claims
When advertising, for example, savings of “up to 40%,” at least 10% of the items must be available at 40% off. Advertisers may want to include a disclosure of both the minimum and maximum savings available to provide more information to consumers. Click here for specifics.
12. Lowest Prices, Underselling claims
Advertisers should avoid making unqualified lowest prices claims. One appropriate qualification is to promise truthfully that the advertiser will meet or beat a lower price sold by others. Click here for specifics.
13. Price equaling, meeting competitors’ prices
When advertisers offer a price match guarantee, the offer should be made in good faith, include all necessary information to take advantage of it, and not place unreasonable burdens on the consumer who wants to take advantage of the offer. Click here for specifics.
Use of the word free includes a requirement, among others, that the “free” item actually is free. When offered with the purchase of another item, the free item should not be paid for by an increase in the regular price of the other item. Click here for specifics.
15. Trade-in Allowances
If an advertiser offers to accept a trade-in when a consumer purchases an item, the advertiser must disclose all terms for the offer clearly and conspicuously. Click here for specifics.
Offering credit to consumers comes with numerous requirements which must be met. In addition, if promising “easy credit,” or “guaranteed financing” or like terms, the consumer should receive what is promised. Click here for specifics.
17. Extra Charges
To avoid confusion, the existence of any extra charges (such as delivery, assembly, postage and handling, etc.) should be clearly and conspicuously disclosed in an advertisement in immediate conjunction with the price. Click here for specifics.
18. Negative Option Plans, Continuity Plans and Automatic Shipments
Advertisements for a product or service that include an offer to sell consumers additional goods or services under a negative option should disclose all material terms of the negative option. Advertisers should avoid making vague or unnecessarily long disclosures that might include contradictory language. Click here for specifics.
19. Bait Advertising and Selling
A “bait” offer is one where the advertiser does not intend to sell the product, but instead to lure the consumer in to switch them to another product, usually at a higher price. Advertisers should avoid such offers. Click here for specifics.
20. Warranties or Guarantees
When using the term “warranty” or “guarantee” the advertiser should clearly and conspicuously include a statement that the complete details of the warranty can be seen prior to the sale which could include putting it on the seller’s website. Advertisers should disclose any material limitations on a “satisfaction guarantee” or “money back guarantee” and define, for consumers, the meaning of claims such as “lifetime guarantee.” Click here for specifics.
21. Layout and Illustrations
The illustrations and overall layout of advertising should enhance the consumer’s understanding of the offers and accurately represent the featured products and services. Click here for specifics.
Asterisks can be used to provide additional information about the product or service. However, they should not be used to contradict or change the meaning of the original claim. Click here for specifics.
Only commonly known abbreviations should be used in advertising. Click here for specifics.
24. Use or Condition Disclosures
Terms including “used,” “secondhand,” “rebuilt,” “reconditioned,” “as-is,” etc. have specific meaning. Advertisers should use them only in those circumstances and with appropriate disclosures. Click here for specifics.
Advertisers must disclose clearly whenever they offer a product “as is.” Click here for specifics.
Advertisers must not describe products as “discontinued,” or by similar words unless the manufacturer has discontinued the product, or the retailer will discontinue offering it after clearing existing inventories. Click here for specifics.
27. Superiority Claims – Comparatives – Disparagement
Deceptively or falsely disparaging advertising of a competitor’s products or services must not be used. Comparisons should fairly reflect all aspects of the products or services equally. Click here for specifics.
28. Objective Superlative Claims
Claims that relate to tangible qualities and performance values of a product or service can be used when the advertiser has substantiation. An example of a claim requiring substantiation would be “#1 car sales in the city.” Click here for specifics.
29. Subjective Claims – Puffery
Expressions of opinion or intangible qualities of a product or service do not need to be substantiated. Such claims include “we try harder” or “best food in the world.” Click here for specifics.
30. Testimonials and Endorsements
Advertisers should ensure that testimonials and endorsement are not misleading and represent the current opinion of the endorser. A consumer endorser’s experience should reflect what users generally achieve, unless there is a clear and conspicuous disclosure of what the expected results will be. Advertisers should not include claims in testimonials that they themselves cannot make and support. Click here for specifics.
Rebates are payments of money after the sale. Advertisers should clearly and conspicuously state the before-rebate cost as well as the amount of the rebate and include key terms that consumers need to know. Click here for specifics.
32. Business Name or Trade Style
Business names or trade styles should not contain words that would mislead the public. Words like “factory” or “wholesaler” should only be used under appropriate circumstances. Click here for specifics.
33. Contests and Games of Chance or Skill
Advertisers should publish clear, complete and concise contest rules and provide competent impartial judges to determine the winners. Contests that include the three elements of prize, chance and consideration (payment) are considered lotteries in violation of state and federal laws. Canadian law contains similar prohibitions. Click here for specifics.
34. Claimed Results
Claims relating to performance and results should be backed up by reliable evidence. Click here for specifics.
35. Unassembled Products
Advertisers should disclose when merchandise requires partial or complete assembly by the consumer, e.g., “unassembled,” “partial assembly required.” Click here for specifics.
36. Environmental Benefit Claims
Advertisers should avoid broad, unqualified environmental claims such as “green,” or “eco-friendly.” Other claims such as “degradable,” “recycled,” and “non-toxic,” should only be used when substantiated and properly qualified. Environmental Certifications and seals of approval may be used if properly issued. Additional disclosures are needed if not issued by an independent third-party. Click here for specifics.
37. “Made in USA” Claims
“Made in USA,” and similar terms used to describe the origin of a product must be truthful and substantiated. In general, all or virtually all of the product must be made in the USA. Qualified “Made in USA” claims can made be under certain circumstances and with appropriate disclosures. Click here for specifics.
38. “Product of Canada” and “Made in Canada” Claims
“Product of Canada,” “Made in Canada” and similar terms used to describe the origin of a product must be truthful and substantiated. To make “Product of Canada” claims, virtually all of the product must be made in Canada. Where goods are partially made in Canada, “Made in Canada” claims can be made if appropriately qualified. Click here for specifics.
39. Native Advertising (Deceptively Formatted Advertisements)
Native Advertisements are created to resemble the design, style, and functionality of the media in which they are disseminated, which could make it difficult to distinguish between advertising and non-commercial content. Click here for specifics.
This article was originally written and posted by the Better Business Bureau. It is reposted here by permission of the Better Business Bureau. No recommendation or endorsement of any BBB service is expressed or implied by the Center for Ethics in Practice, the University of St. Thomas, BERC, or any of its sponsors, partners, or content providers.