For the past two years, Consumer World has been investigating TV talk shows that present what looks like a typical informational segment, but in fact the program is quietly making money by airing it. In essence you are watching an infomercial — advertising masquerading as regular program content. (See our first two stories, one about the truth behind “deal” segments on morning TV, and the other about doctors as product experts on television.)

Another prong of our investigation focused on a segment from the CBS daytime show, The Talk. In this March 2018 segment, a dermatologist conducts a beauty care quiz with the co-hosts and the audience.

After several general questions, the dermatologist casually mentions a particular product line, No7, and discusses the benefits of it. The program host then introduces a consumer in the audience who tells of her positive experience with the product. Only in the credits at the end of the program is there a momentary disclosure that No7 sponsored part of the show.

*MOUSE PRINT:

So this segment which appeared to be a regular part of the program was really an infomercial of sorts. Marketers call it “product integration.”

There are several legal issues here. Was the doctor paid by the company to tout its products and was that consumer in the audience a plant?

To answer the first question, we did a little digging. On The Talk‘s website, CBS offered this description of that beauty segment:

*MOUSE PRINT:

And on the doctor’s own social media account, we found her thanking the manufacturer for selecting her to be their dermatologist spokesperson for No7:

*MOUSE PRINT:

As for the audience member who touted her results using the product, we can find no independent information about her. However, what are the odds that sitting right there in the front row was an average consumer who just happened to try the product and liked it? In all likelihood, both the doctor and audience member were paid by No7 for the appearance. And that triggers the FTC’s guidelines governing testimonials and endorsements, which require clear disclosure if those people were paid for their comments. No such disclosure was made on the program.

Equally if not more important is the lack of disclosure to the viewing audience at the time the segment was airing that it was actually sponsored content — in essence an advertisement — rather than a regular program segment. They disclosed the sponsorship only in the credits at the end of the program. Under the FCC’s “payola” rules, if a program’s producers receive payment to feature a product, that fact must be disclosed to viewers during the program.

Also, whenever someone creates content that looks like the other material that surrounds it, but is really advertising, this is called native advertising. To keep viewers of TV shows and readers of news websites properly informed about the commercial nature of these types of offerings, the FTC’s native advertising guidelines require clear, up-front disclosure. And that is often missing or obscured.

After seeing this segment on The Talk, Consumer World contacted the West coast head of broadcast standards at CBS to remind the company of the various disclosure requirements, and ask what the network was going to do to correct the problem. Not long thereafter, the segment was quietly removed from the CBS website. And eventually, we got a reply:

“I have been advised that we have reviewed our practices and procedures and have reiterated to those involved the importance of transparency, and adhering to the applicable guidelines. You may have seen some changes on our product integrations on THE TALK, as well as some of our other programs.”

This segment on The Talk is but one example of the secret commercialization of content on TV talk and information programs. Over the years, we’ve seen other sponsored segments with often poor disclosures on The Doctors, Rachel Ray, Steve Harvey, and other shows. We hope that the FTC will direct some of its enforcement efforts to the television networks that engage in these sneaky practices.

Next week we check out a segment on the Dr. Phil show that just aired a few weeks ago.

For the past 10 years, we have warned readers about fake news sites with stories that tout pills and face creams supposedly endorsed by big celebrities or reporters. In reality, those celebrities never actually used or promoted those products. Now the stars are fighting back against the scammers (See New York Times story.) Also, see our 2019 story, 2016 story and one from 2009.

Last week, Ellen DeGeneres and Sandra Bullock filed a lawsuit against 100 unspecified defendants who over the years have set up websites selling beauty aids usually on a free trial offer basis using their likenesses and made-up endorsements without authorization.

Here are excerpts from two such websites with fake stories and testimonials about products they never used:

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All these types of sites use celebrities’ testimonials to convince potential buyers of the legitimacy and effectiveness of the products they are pitching. The offers generally end with a free trial period (just pay $5 for shipping). Inconspicuous fine print disclosures ultimately hoodwink unsuspecting buyers into receiving monthly shipments of the products for $70-$90 a bottle or jar.

We asked Ellen’s lawyer why they filed this suit.

“People are being defrauded in this massive scam using Sandra’s and Ellen’s names and images. Like Whack-A-Mole, for each fake site exposed, another one pops up. The complaint exposes the scam and how it works so people can avoid getting trapped in it, and provides a way to identify those responsible and profiting from it so they can be stopped and held to account.” — Michael Weinsten, Attorney for Ellen DeGeneres.

The lawyers are seeking compensatory damages, disgorgement of profits, punitive damages, and an injunction against the use of their clients’ likeness and name in the future.

We say, go get’m.

When a web store offers 20% off upon entering a promo code at checkout, who wouldn’t use it? We all would. But here is an example from the Bath and Body Works website that may make you rethink always using a coupon code.

For this purchase of some hand sanitizer, they are charging $5.99 for shipping. There is, however, at the top of every page a 20% off offer if you enter a particular promo code when you check out.

If you enter that code, something surprising happens.

*MOUSE PRINT:

While you indeed get a $2.20 discount on the hand sanitizer, the price of shipping mysteriously jumps up $4 from $5.99 to $9.99.

What’s going on here? The answer is contained in a fine print disclosure elsewhere on their website:

*MOUSE PRINT:

The 20% off coupon which was applied to this order reduced the merchandise total to under their $10 minimum and thus a $4 surcharge was imposed. Most people would never realize that using a discount coupon could actually cost them money.

Amazon has begun opening small brick and mortar retail stores called “Amazon 4-Star.” The stores only feature products that are rated four stars or higher and that are new and trending or bestsellers. One just opened last week in Natick, Massachusetts, to join the ones already in Manhattan, Denver, Seattle, and Berkeley. So MrConsumer paid a visit to the new store.

The company installed electronic shelf tags that allow it to change prices on goods multiple times a day just the way they do online. Worse, they are using an unusual type of dual pricing on some of those tags – one price for Prime customers who pay $119 a year, and another price for the rest of us.

Here’s a book they had at the store.

The electronic price tag shows a Prime price of $20.99 and a “price” of $34.95. The store says that non-Prime customers would pay $34.95.

Looking up that book at Amazon.com provides a surprise.

*MOUSE PRINT:

It shows that $20.99 was not a special Prime members only price, but a price that anyone could order it for. Worse, it says the list price of the book is $34.95 — exactly what the Amazon store was charging non-Prime customers. Since when does Amazon sell anything at full list price?

Here’s another example.

This Instant Pot is $79 for Prime customers only, and $99.95 for everyone else. But a quick look at the website reveals…

*MOUSE PRINT:

Everyone pays $79 online for the Instant Pot and it is not a Prime exclusive item or price. The $99.95 they are charging in their brick and mortar store is full list price.

A third example is here.

While many items in the store have this dual pricing system, most have a single price on them. That single in-store price appears to match the online price. The store will not price match Amazon.com’s web price for non-Prime customers.

We asked Amazon’s PR folks why they use a dual pricing system, and why in the world this famous discounter is charging full list price on some items to non-Prime customers. The spokesperson was not able to reply in time for publication, but we will post the response when it is received. And surprise, they did not provide us with a statement. But, we found an inconspicuous disclosure now on the Amazon website:

*MOUSE PRINT:

The lesson here is not to assume you are paying the regular Amazon.com price at their retail stores. Do a quick check online to make sure you are not overpaying.

Several prominent newspapers in the Tribune family are now devoting entire sections of their websites to product reviews. Sounds great – a good consumer service. The problem is that the articles amount to a form of advertising because the papers get paid for each product sold, and they don’t disclose that fact to readers upfront.

Here is a screen capture of the product review section from the Chicago Tribune:

Scroll down the list.

Some of what they cover are important topics such as “The Best Men’s Slipper,” “The Best Baby Bath Toy,” “The Best Nipple Pasties,” and “The Best Cake Pop Maker.” These certainly are the type of reviews that shoppers are clamering to read, MrConsumer opines sarcastically.

A full page of stories/reviews also appear in the consumer review section of the Sun Sentinel (Florida), the New York Daily News, the Baltimore Sun, and other Tribune newspapers.

Here is an excerpt of the men’s slipper story, as an example. Note that the links to the three “best” slippers all go to Amazon.

*MOUSE PRINT:

Scroll down the story to see links.

Those links are affiliate links where Amazon (in this case) pays a small commission if a reader buys any of those slippers. Hovering over the link reveals a “tag” used by Amazon to identify the affiliate so it knows whom to compensate.

*MOUSE PRINT:

That commission on each sale is shared between both the newspaper and the service that provided the reviews, BestReviews. Tribune Publishing is a majority owner of BestReviews. The review company says it strives to be 100% objective because it buys all the products it tests. But the company admits it doesn’t really test all the products it writes about.

*MOUSE PRINT:

“For some product categories we solely use research and consumer feedback to create the information in our review.”

If you didn’t realize that the newspaper publishing these stories makes money via those links, that is no accident. The paper only discloses that financial connection at the very end of each review.

*MOUSE PRINT:

Federal Trade Commission guidelines for both product endorsements and native advertising (where advertising looks like regular editorial content) require clear disclosure if there is a financial connection between the parties, and that advertising content that looks like regular articles be clearly labeled. Whether the Tribune has violated the law is up to the FTC to decide, but we think they could do a better job of disclosing at the top of these articles that both the company that wrote the stories and the newspaper that publishes them make money if readers make a purchase through the provided links.

We asked editors at the Chicago Tribune, the Sun Sentinel, and the Tribune entity that distributes these stories some very pointed questions about their review section. None of the three responded to our inquiries.

The use of affiliate links in traditional media stories seems to be increasing. So (unfortunately) you have to look carefully to see if a website posting a story about a particular product might also be recommending it because they have a financial incentive. If so, take that into account.