What’s That You Say? Managing Third-Party Retailer, Distributor Claims About Your Product

May 12, 2011

Legitimate supplement companies should be aware of what third-party retailers and distributors of their products are saying.

As a naturopathic physician, I was frustrated when my patients abandoned a well-rounded wellness program in favor of a “magic bullet” dietary supplement. We’ve all seen the egregious ads and unsupported claims promising a quick fix to weight loss, or a “natural” way to bulk up, or a “cure” for chronic diseases. It’s unfortunate that there are companies in the marketplace preying on consumer desires for instant results by illegally positioning products as having these kinds of effects. Although there is a consumer market for quick-fix supplements, it doesn’t make it right for companies to sell them using illegal promises. Legitimate supplement companies should be aware of what third-party retailers and distributors of their products are saying, and should take steps to help ensure everyone throughout the supply chain is staying within the boundaries of the law.

A recent report from the Government Accountability Office, and a subsequent Congressional hearing, raised concerns about unsupported and irresponsible marketing claims made to consumers by retailers who are either unaware of, or willingly ignoring, dietary supplement advertising laws. FDA and the FTC have made it clear that enforcement against illegal supplement claims is a priority and that online marketers and retailers are on their radar. Whether or not a sales clerk truly believes a product can treat cancer, replace conventional medicines, or help someone lose 10 pounds in one week is irrelevant. Because unless that salesman is licensed to practice medicine, it is illegal to make such claims, whether verbally or through marketing materials. And illegal actions are bad for consumers, bad for your business, and bad for the industry.

A manufacturer would be smart to familiarize itself with the laws surrounding third parties marketing its products-particularly because of the negative impact that third-party marketers making unsupported claims can have on a brand. Companies should not wait to see their names tarnished by a third party’s mistakes, innocent or otherwise, but instead should be proactive and cover all their bases to protect their brands.

To be proactive, the first thing companies can do is to educate retailers on what they can and cannot say when it comes to selling supplement products to consumers. Many companies and retailers develop their own educational materials, sharing them with employees through seminars or other practices. The Council for Responsible Nutrition (CRN) recently released its “Roadmap for Retailers: Safely Navigating What You Say about Dietary Supplements,” a tool that manufacturers can provide to retailers as a guideline. The “Roadmap” is available at no charge on CRN’s website, www.crnusa.org.

Second, suppliers and manufacturers should monitor what others are saying about their ingredients and brands, and proactively correct those found making irresponsible and unsupported claims. Companies shouldn’t just turn a blind eye to how others are marketing their product for two main reasons: 1) to protect your consumer; and 2) to protect your reputation-both of which are vital to ensure the survival of your brand. The FTC’s Guide Concerning the Use of Endorsements and Testimonials in Advertising and previous decisions by the National Advertising Division have both helped set a precedent for what is expected of companies with regard to third-party claims. The FTC has suggested firms take up a risk-based, “reasonable monitoring program” so a company can keep track of what is being said about its products.

Protecting your brand’s reputation is key. Instead of waiting for the worst to happen, get out in front of the situation. Practice education and put a prevention policy in place, as these steps will help you in the long run. Illegal claims not only put your business in jeopardy of monetary regulatory enforcement action, but they also destroy consumer trust. And if you or your products are labeled as untrustworthy, it is unlikely your brand will survive in the marketplace.