As an online business owner, having a great product or service is just half the job. If people do not know your business exists, sales will not follow. That is why most online businesses invest in advertising. In the U.S., ads are closely regulated to protect consumers from being misled. If you advertise online, whether through social media, email, influencers, or your website, it is essential to understand the advertising laws that apply. Let’s walk through the top five advertising laws every online business should know.

Disclosures Must Be Unambiguous

The Federal Trade Commission (FTC) is a body that ensures consumers are protected from deceptive advertising. Disclosures in advertising have to be clear and conspicuous. This means that your disclosure must be easily noticeable, easily understandable, and placed close to the claim it explains. You should never attempt to bury important information in tiny font, footnotes, or separate links.

Truth in Advertising is Non-Negotiable

Truth-in-advertising laws require that ads be truthful and supported by evidence. Under Section 5 of the Federal Trade Commission Act, businesses are prohibited from engaging in unfair or deceptive practices in commerce. You cannot run an ad that misleads a reasonable consumer, or omit any facts that would alter how someone perceives your product. In some industries, the FTC shares oversight with other federal agencies. For instance, the Food and Drug Administration (FDA) also regulates advertising for products like food, drugs, dietary supplements, medical devices, and cosmetics, meaning businesses in these sectors must comply with both FTC and FDA rules.

Claim Substantiation

According to the FTC’s substantiation doctrine, any advertising claim must be supported by evidence before the ad goes live and while it is running. This applies to both express claims, which are the direct statements, and implied claims, which consumers are likely to infer from context, visuals, or wording. Because implied claims do not require intent, they often create significant legal risk. This can put your business at risk if consumers infer a particular meaning you didn’t even realize you were communicating.

Material Connections Have to Be Disclosed

If someone is endorsing your product, and there is a material connection, such as payment, free products, commissions, or other benefits, that connection must be disclosed. Even expert endorsements or independent testing claims require disclosure if there is compensation involved. The goal here is transparency, so consumers understand when an endorsement is not purely organic.

The Lanham Act

While the FTC protects consumers, the Lanham Act empowers competitors to sue for false advertising. So, if your ad contains false or misleading claims that harm another business, you could face a lawsuit.

For a business to successfully sue under the Lanham Act, it must establish the following:

Claims made in your ad are actually false

The advertisement could or did deceive a large number of the targeted population

The product shown in the ad was sold across state lines

The deceptive part of the ad was significant

The competitor was going to be harmed by the deception.

When making an advertisement, always ensure you are not violating any of these laws.

Contact the Internet Law and Social Media Attorneys at Revision Legal

For more information, contact the experienced Internet Law and Social Media Lawyers at Revision Legal. You can contact us through the form on this page or call (855) 473-8474.