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Avoid Misleading Customers with Energy Saving Ads
October 02, 2012

BBB Reminds Businesses to Avoid Exaggerated Product Performance Claims

As BBB Accredited Businesses, your company commits to uphold high standards of ethical marketplace behavior, including advertising honestly. Recently, the Federal Trade Commission issued warning letters to several companies across the country regarding energy savings claims made in online advertisements. BBB encourages you to review the following FTC and BBB advertising guidelines to ensure all claims are substantiated and truthful:

Energy savings claims must be backed by scientific evidence.
Product claims of energy savings, performance, safety, results, etc. should be based on recent and competent scientific, engineering or other objective data.

Be specific about the type of savings consumers can expect.
There is a difference between total home energy savings and heating and cooling savings. Heating and cooling expenses may account for less than half of a home energy bill. Thus, a 15 percent reduction in a home’s heating and cooling costs does not mean the homeowner will save 15 percent on his or her entire energy bill. If you claim consumers will achieve a specified percentage of energy savings, you should state clearly whether you are referring to heating and cooling savings or savings on a home energy bill.

Be prepared to substantiate all claims.
The primary responsibility for truthful and non-deceptive advertising rests with the advertiser. Advertisers should be prepared to substantiate any claims or offers made before publication or broadcast.

Be careful when making “up to” claims.
A recent FTC study shows many consumers interpret claims that products will save “up to” a specified amount of energy to mean that almost all consumers are likely to get the specified savings. To avoid confusion, clearly disclose the results consumers are likely to get. For example, if you say that consumers will save “up to” a specified percentage in savings, your substantiation should prove that almost all consumers are likely to get that percentage in savings.

Be realistic when selecting home characteristics for modeling.
Many factors affect the savings homeowners achieve by using energy efficient products, including a home’s location, size, insulation and existing windows. If you use energy modeling software to determine the savings consumers will get from your products, avoid choosing characteristics that produce inflated results.

Clearly and prominently disclose any assumptions.
If your substantiation shows that consumers will get a specified amount or percentage of savings only under certain circumstances, disclose those circumstances clearly and prominently near the claim. Disclosures in small, difficult-to-read type may not be enough to clarify a savings claim.

If you have a question regarding the nature of a future advertisement, please contact BBB at info@centraltx.bbb.org. BBB’s Code of Advertising is available at www.bbb.org/us/bbb-code-of-advertising.