This post is really written by Mr. Kevin Thompson, an attorney who helps distributors and companies around the world interpret the rules and define where the grey area is. I've chosen to translate it more or less straight off, because I know a lot of people don't read the information due to the language barrier. Read his full post HERE.
He starts by writing that we out in the field must not get involved in anything with COVID content. Companies have to step up their efforts when it comes to policing things so that this kind of content doesn't get out. We need to educate everyone in the field to avoid referring to it.
Use every online tool to get this information out to as many people as possible through newsletters, websites, social media and Zoom meetings, is his recommendation.
Selling supplements during a pandemic
The authorities in the US (the Federal Trade Commission) have spoken loud and clear. Instead of operating with a scalpel, they chose a sledgehammer. Their message is clear: Stay away from COVID. Don't even test the line.
On Friday, the FTC sent warning letters to 10 network marketing companies. These letters were all identical apart from the referenced claims associated with each company. The letters demanded that each recipient respond within 48 hours by email regarding the "specific actions taken to address the FTC's concerns."
This message is consistent with what the FTC has been doing since the beginning of March. They've created a separate page containing all the warnings sent out regarding supplements / income opportunities and COVID. So far, 70 warnings have gone out, 10 of them to network marketing companies.
The rule
It's legal for sellers of supplements to make "structure function" claims. So what is a structure function claim?
Translated into something we ordinary people understand: It's legal to suggest that a supplement can "support" a bodily function. It's not legal to suggest that a supplement can "fix" a broken bodily function, or even improve it. I know, it's complicated.
So when distributors for various companies suggest that consumers should take an "immune booster" to better prepare for the coronavirus, the FTC has made its position clear. VERY clear. There is no grey area.
The challenge
"Our product supports the immune system ... and people need a strong immune system to fight disease! ... so why can't we talk about it?"
That's a fair question. The whole point of "supporting an immune system" is to put the consumer in a better position to defend against illness. After all, the healthcare system is going through serious challenges and may even be on the brink of collapse.
Healthcare costs exceed people's ability to pay, and people are wary of going to clinics for check ups because of cost and fear of catching something. This leads people to explore alternative ways of minimising health risks, that is, to focus on prevention. That has created an enormous opportunity for network marketing, e-commerce and retail companies selling health related products.
Discussing immune system support is fine. Saying or implying that a consumer can boost their immune system to be better positioned to fight COVID is not fine.
The point
Companies shouldn't "tempt fate" and weigh the pros and cons of exploiting the pandemic for profit. There have to be strict measures in place to prevent any kind of reference to COVID or anything connected to coronavirus, COVID-19, quarantine, lockdown, pandemic, epidemic, etc. Hashtags that also refer to COVID should be avoided as well.
These are some of the solutions companies are looking at in real time right now:
A disclaimer on the website;
Distributing newsletters to the whole organisation;
Expanding search parameters on social media to catch references;
Lowering the tolerance for violations;
Adding segments to Zoom conferences on compliance training.
Adding disclaimers across all web properties to make it clear that the products can't be used to reduce the risk of COVID (or any other disease)
Promoting an income opportunity during a pandemic
If Mr. Thompson were to rank the concerns, it's his view that the FTC is mainly worried about sellers of supplements exploiting the pandemic to sell product. If there's bad information in the market about preventing and treating COVID, the results can be fatal.
The FTC didn't stop there, though. They also highlighted several cases of inappropriate income claims mixed with COVID. Here there's really nothing "new" to discuss.
Without a sufficiently clear statement about the income opportunity, the FTC considers income claims of above average results to be misleading. Period.
The latest warning from the FTC simply makes it clear that (a) they'll hold companies accountable for statements made in the field; and (b) they find it highly offensive when people exploit COVID to promote an income opportunity without showing a clear explanation of what it takes (a so called income disclosure).
See below for two examples:
"The company I work with is always open, even during quarantine! I've been working from home for over three years now and I'm still making money when others aren't! Isn't it time you found out what it is I do and how this company really works? . . . #workfromhome #financialfreedom."
"There's so much uncertainty in the world right now but our team has no CRISIS! We're having our best month ever and so many people are earning 100,000 a month now! Working from home has never been easier. Does anyone else need an income from working at home right now?"
His conclusion
A product message must never be combined with COVID. When it comes to the income opportunity, the same principle applies: promoting the income opportunity while directly or loosely referring to the pandemic is, according to the FTC, offensive.
Companies and leaders in the field have to "step up" to prevent a wave of unapproved claims now and in the future.
There really is an ocean of opportunity out there right now, despite a shaky economy. The future belongs to companies and distributors who can see around the corner, build with integrity, trust their advisors and deliver real value to consumers.
If you want to follow Kevin Thompson, you'll find him HERE.
You'll find my FB page HERE.
