Reviews on the Internet can be a tricky thing. Most Internet marketers assume that writing a review is always regarded as sharing a personal opinion, and chances are good that you’re reading this post from a country that values free speech as a right. But with organizations like the Federal Trade Commission involved, you have to be very careful any time you promote a product or service on your blog.
It’s not just your reputation as a blogger on the line if you make a mistake, but your very livelihood. Worse, you could face fines or legal repercussions should you falsely promote a product for personal gain. So what are the dangers of building review sites, or even hosting a guest review on your blog?

The Federal Trade Commission

The FTC publishes a set of guidelines periodically on endorsements (which you can find here) that outline exactly what you can and can’t do when you endorse a product or service. But there are a couple of general rules that can help you adhere to the guide quickly when looking at your own website.
If you receive some form of compensation for reviewing a product, this should be disclosed at some point in the review. For example, you might be contacted by an advertiser that offers to pay you each time you write a positive review of their product on your site, instead of buying banner advertising. This should be mentioned in the review. This works the same way if you receive the product for free, and expect to continue receiving free products from the advertiser in exchange for positive reviews. Of course, simply receiving a free product with no strings attached because the company hopes you will provide a good review does not necessarily require a disclosure that you didn’t have to pay for the product.
For the sake of honesty however, you might decide to mention that the company provided that product or service to you at no charge. The disclosure can be as simple as — Disclosure: I was compensated to provide this review on behalf of [Insert Company].
But anchor text is a whole different story. Just because you link to a site does not mean that you are reviewing their product. If you receive no monetary compensation for linking to a review site, such as including a link to a wireless Internet site using anchor text like compare CLEAR 4G, like we did here, you’ve done nothing wrong according to the FTC.
To sum up the FTC Endorsement Guidelines, remember these three simple rules:

• Don’t review a product that you haven’t tried.
• If you receive some form of compensation for trying a product and didn’t like the product, don’t pretend like you did.
• Don’t support or make claims that can’t be backed by research or scientific proof. If you can’t prove that a product will help you lose 60 pounds in one week, for example, don’t say so in the review.

The FTC is particularly careful about any product that consumers put in their mouths, such as pills or food. Be absolutely certain that you can back up every claim that you make about a product before endorsing it. As you will see in the next section, the repercussions for making false claims about a diet pill can be severe. Once you start reviewing weight loss or similar products, you begin treading not just in FTC territory, but FDA territory as well.

What Can Happen if You Violate FTC/FDA Guidelines

It’s unlikely that you’ll face a fine for forgetting to disclose that you were compensated for providing a positive review of a product. It’s even more unlikely that you’ll face prison time. However, making false claims about a product or service is a whole new ballgame, and you can face very serious consequences for doing so.

Two famous fraud cases have been reported in the last year, both involving dietary supplements. One man was sentenced to 20 years in prison for allegedly making false claims about a diet pill that promised to help users shed nearly 50 pounds in a month. His claims were supported by an unlicensed Mexican doctor, when they were even remotely supported at all. Prosecutors also claimed that the man received substantial monetary benefits for providing the false reviews, making as much as $10 million in four years.
Another famous infomercial guru named Don Lapre was also indicted for allegedly making false claims that prosecutors claim defrauded hundreds of thousands of customers for millions of dollars. These infomercials made claims involving a product called “The Greatest Vitamin in the World.” The FDA simply charged the man with making claims that were not supported by evidence, and indicted him of 41 counts of fraud. He was later found dead in prison of a self-inflicted wound.
In general, avoid making substantial claims like “this is the best product in the world” or “this product will change your life” if those claims cannot be supported by evidence. A good rule is to simply avoid hyperbole in your statements.

Your Website’s Readers and Trust

Legal trouble is not your only worry when using reviews to monetize your website. Your readers trust that the information you provide is honest and accurate — that’s why they read your content. If you continually review products that you haven’t tried, or promote products that you don’t like yourself, you risk losing your readers’ trust, and losing traffic and conversions.
To avoid losing trust in your audience, try every product before providing a review, even with sponsored reviews. If your advertisers are not willing to let you try a product before allowing them to post a review or advertisement, it might be time to find new advertisers. Best of all, you can make the claim that you try each and every advertiser or product that goes on your site before publishing information — which can help you earn more trust and conversions.
Focus on products that really fit your audience’s interests. In other words, don’t simply send out email newsletters loaded with every advertisement you can secure. This can actually hurt your conversion rates more than it can help them. Readers can usually tell if you honestly think a product or service is worth their time.
Remember, some bad points in every review show that you are impartial, and don’t necessarily mean that they won’t buy the product. There are negative aspects to even the best products and services in every niche, and things like a low selling price or overwhelming positives can still make a product worth its price.
Guest Post By: Mitch O’Conner is an online marketer and writer. When he’s not busy testing sites, generating traffic or writing content, he enjoys spending time with his wife and kids, watching TV, playing games or going camping.