Reviews and testimonials are powerful tools; they show other customers that your business is trustworthy and high-quality. If you don’t have reviews, it’s a red flag for prospective customers. Many businesses will offer gift cards, discounts, or other incentives in order to get their first reviews. So, can you offer gift cards for reviews? What about other incentives? Let’s take a closer look.
Note: this post is not legal advice. If you are uncertain about legal implications, always consult a legal expert.
Can You Offer Gift Cards for Reviews?
The short answer is yes, you can offer gift cards in exchange for reviews. However, there are some important caveats to keep in mind. Ignoring these important points can result in some serious trouble for your business.
Providing gift cards in exchange for reviews can sometimes be confusing. Here are a few good rules of thumb to keep in mind:
- Your must disclose that you provided gift cards in exchange for the reviews that you collect
- The review must be an honest retelling of the customer’s experience.
- The review should not lead customers to expect unrealistic results
- You cannot offer gift cards for reviews on other review websites, like Yelp, Amazon, Google, etc.
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Can You Offer Gift Cards For Reviews You Collect Yourself?
You can offer gift cards to customers in exchange for reviews that you gather yourself (ie; not gathered through a third-party site like Google or Amazon, which we’ll explain in more detail later). However, when you offer gift cards in exchange for reviews, it’s important to be transparent about this process.
The Federal Trade Commission (FTC), which dictates fair advertising practices, outlines the review collection process in their Guides Concerning the Use of Endorsements and Testimonials in Advertising. In § 255.5 “Disclosure of material connections,” the document explains that advertisers and businesses must disclose any “material relationships” with an endorser, including someone who provides a review or testimonial. This means that the reviews or testimonials you gather in exchange for gift cards must clearly show that the customer received a gift card. You might do this by adding a simple statement such as, “this customer received a gift card as thanks for their input. Add your input and you can receive a gift card too!”
What About Celebrity Endorsements?
If you’ve noticed advertisements with celebrity endorsers, but you haven’t noticed any disclosure of a material relationship, you may be wondering if businesses really follow this rule. It’s important to note that disclosing celebrity compensations are not usually required since, according to the FTC, “such payments likely are ordinarily expected by viewers.” This does not apply to everyday customers, however.
Incentivized Reviews Must Still Be Honest and Accurate
It’s also important to note that, when you provide gift cards in exchange for reviews, the reviews still must be honest and accurate depictions of the customers’ experience. The reviews also cannot make unsubstantiated claims that don’t reflect the average consumer’s experience. For example, if a customer reviews a skin care product and claims that it cured their eczema, but the product has no ingredients designed to do that and such an effect should not be expected, the business should not use this review in their advertising. Otherwise, they could be fined for deceptive advertising.
Can You Offer Gift Cards for Reviews on Sites Like Amazon, Google or Yelp?
No, you cannot offer gift cards for reviews on sites like Amazon, Google, Yelp or others. The practice may get you banned from these sites.
You may be wondering, why do other websites have stricter rules than the FTC? Third-party websites that collect reviews have financial incentives to make sure that their reviews are accurate and reliable for consumers. If consumers think that the majority of reviews on these sites are not reliable or accurate, this aspect of the website will be useless. So, these sites take a harder stance in order to protect the value in their websites. By contrast, the FTC must serve both businesses and consumers, and make rules that are fair, but not overly restrictive. Forbidding incentivized reviews or endorsements all together could put a strain on businesses, especially new businesses who are seeking their first reviews.
Can You Offer Discounts or Other Incentives for Reviews?
Instead of gift cards, you might consider offering discounts or other incentives in exchange for reviews, such as free samples or free shipping. However, these perks would also be considered a “material relationship.” Third-party websites would also consider these perks incentives, which would not be allowed for collecting reviews.
This means, you may offer discounts or other incentives to customers in exchange for reviews, but you must disclose this practice. Remember that third-party sites take a stricter stance, and this practice is not allowed if you’re collecting reviews on a third-party site.
What If You Break These Rules?
Breaking these rules can have big consequences. The FTC has fined businesses millions of dollars for using unfair or deceptive advertising practices. Amazon and Yelp have both sued businesses who have tried to buy or incentivize reviews on their sites. Breaking these rules and taking part in deceptive advertising can put you at risk for expensive fines, lawsuits, orders to retract advertisements, and more.
If you’re working on collecting reviews, but you’re worried about breaking these rules, a simple rule can help you avoid repercussions; be honest. When you’re transparent about how you’re collecting reviews and what you can offer, you’ll win over even more customers.
Posted in: Customer Feedback