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Customer Testimonials Under Scrutiny

Posted by on 27 Jun 2013

Customer testimonials have long been used as a legitimate, and in many cases effective, marketing tool. But have you ever read a testimonial and wondered whether it was real or fake? More importantly, with the rise of social media and customers being able to post comments and testimonials on anything from Facebook to YouTube, how can you be certain that the comment is real?

The concept of 'misleading and deceptive' statements on social media is becoming a significant issue and cases brought before the Courts as recently as February 2013 are highlighting this. The ACCC has also made a statement recently that it is prioritising work in the areas of credence claims and fake testimonials.

As far back as February 2011, the Federal Court held that Allergy Pathways was responsible for the customer testimonials posted by customers on the company’s Facebook wall. This was the Court’s view on the basis that the company did not remove the statements once it became aware of them. As a result, the company and its directors were each fined $7,500 for breaching promises to the Court that they would not make any misleading and deceptive statements. This particular decision was also the first time that the ACCC obtained court orders requiring someone to place corrective notices on channels of video streaming websites such as YouTube, where some of the misleading and deceptive statements were made.

In February 2013, the ACCC commenced action against the companies trading as “Euro Solar” and “Australian Solar Panel” for written testimonials that appeared on and video testimonials that appeared on YouTube and It was claimed that the testimonials were not made by genuine customers of these companies and the ACCC is seeking penalties and costs in relation to these alleged misleading and deceptive statements.

Each of these cases sends a clear message that a company cannot hide behind a user or customer to escape liability for materials posted on its social media page. Any incorrect statements on your social media page should either be removed or specifically addressed and corrected on your social media page. Most importantly, any comment you make in response to a customer's must be sufficiently strong so as to override the false impression made by the original comments.

The best course of action? Don’t get caught up in the first place. Monitor your website and social media pages carefully and ensure that any testimonials or comments posted are genuine and accurate. This applies not only to testimonials by the company but also by site users!

For more information please contact our experienced lawyers (02) 9895 9200.

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