Electronic retailing self-regulation program
The Electronic Retailing Self-Regulation Program (ERSP) is a self-regulatory program created in 2004 by American business organizations to promote consumer confidence. ERSP is a program of the Electronic Retailing Association http://www.retailing.org in conjunction with the National Advertising Review Council (NARC) and administered by the Council of Better Business Bureaus. The mission of the program is to enhance consumer confidence in electronic retailing, by providing a forum to self-regulate direct response advertising.
ERSP was created for several reasons, to: improve consumer confidence in electronic retailing; demonstrate the strong commitment of this industry to effective self-regulation; provide a quick and efficient mechanism for review of high-profile advertising (such as weight-loss advertising) and affecting the discontinuance of advertising containing egregious claims. ERSP investigates the truth and accuracy of claims in direct response advertising from inquiries brought to ERSP’s attention through competitor’s challenges, consumer’s concerns, or through ERSP’s ongoing monitoring program. Working as a voluntary program, ERSP is an efficient and useful tool to assist direct response marketers with timely and cost effective measures to minimize government interference and increase consumer confidence.
The direct response industry includes long-form (infomercial) productions, short-form commercials, live home shopping channels, print advertising, Internet marketing, cell phone advertising, broadband channels, and radio advertising. Anything that has a direct link to the marketer: either a 1-800 number, email, or website is within ERSP’s purview.
ERSP inquires about the evidentiary support that a marketer possesses for product claims communicated through any form of direct-response advertising. Advertising claims come to ERSP’s attention through competitive challenges and ERSP’s ongoing monitoring program.
Among the most significant benefits afforded by this program are:
• speed – the ERSP mandate is to resolve all inquiries within 60 calendar days
• cost –low cost alternative to litigation
• burden of proof – ERSP does not require that injury to a consumer be proven as may be required by law and
• confidentiality – a company may bring cases anonymously to ERSP and, conversely, any proprietary information submitted confidentially will remain so in an ERSP challenge.
The 60-day structure of this program is vital in limiting marketer inconvenience, but comprehensive enough to provide a thorough review. The success of the program lies in the voluntary participation by direct response marketers and the nature of the self-regulatory format. With the beneficial nature of this format for the electronic retailing industry, ERSP looks forward to not only continuing its monitoring program but to addressing the challenges brought by both consumers and competitors of electronic marketing.
Core claims at issue in an ERSP inquiry might include:
• Establishment Claims (“Clinically proven”)
• Performance Claims (how well a product performs)
• Testimonials (Anecdotal tales from consumers about their results with the product)
• Weight Loss Claims
• Health and Safety
• Before and After Photographs
• Comparative Claims
ERSP opened its first case in August 2004.
How the ERSP Process Works
ERSP details its concerns in an initial letter of inquiry and the marketer is given 15 calendar days to respond to ERSP with substantiation for the issues raised. ERSP then has 15 calendar days to ask the marketer for more information regarding its submission. Upon receipt of that request the marketer has 10 days to answer ERSP’s questions, and upon receipt of that, ERSP has 15 calendar days to reach a decision.
If a marketer does not respond to the initial inquiry letter by ERSP, a press release summarizing the claims at issue and announcing a 10-calendar-day response for the marketer is released.
ERSP Determinations – What to Expect
Participants in an ERSP review can anticipate one of three results:
• ERSP determines that the core claims at issue are supported by reasonable evidence.
• ERSP recommends the marketer modify core claims.
• ERSP determines there is no support for the claims at issue and recommends that the advertiser pull the advertisement.
ERSP also refers marketers to the appropriate regulatory agency if they fail to respond or refuse to comply with ERSP’s findings. Compliance inquiries are also conducted to confirm compliance with ERSP recommendations.
ERSP Review Program
In January 2012, the Electronic Retailing Self-Regulation Program (ERSP) expanded its purview to monitor and review advertising of the coaching and mentoring and live seminar industry. The program is called the “ERSP Review Program.” The ERSP Review Program has two fundamental components: 1) review of telemarketing practices and free live seminar events which include telesales phone calls, scripts and recordings of free, live seminar events ; 2) monitoring of lead generation advertising applicable to the coaching and mentoring industry including print, broadcast and online advertising.
ERSP Copy Review
In 2014 ERSP introduced its Copy Reviewservice which is offered to members of the direct response industry and provides a review of advertising and the reasonable messages being communicated in the advertisement (usually conducted before the advertising is nationally disseminated). The review is focused on the legal, regulatory, self-regulatory and/or statutory provisions that should be considered and/or adhered to with respect to representations (express or implied) disseminated in an advertisement. Unlike a preclearance service which entails a comprehensive review of a marketer’s substantiation, a copy review evaluation is a “non evidentiary” review and is limited to “primary” and “core” claims communicated in an advertisement. Consumer complaints can be sent into ERSP via this complaint form.
Copies of previous ERSP case reports are located here.