Beware of Your Website's Free Trial Offerings Amidst FTC Crackdowns

Deceptive marketing is unethical and a scam, and it has no place on the internet, says the Federal Trade Commission (FTC). If you operate a website with a shopping cart checkout system, be careful how you sign up paid subscribers or offer other free trials.

The Dangers of “Free Trials”

Recent national news stories have been broadcast highlighting victims who felt they were conned into signing up for subscription services just by ordering a “free trial” of a product. Little did the victims know that by ordering the free trial, they were also signing up for other paid subscription services that they had no intention of purchasing.

How did that happen? The website operators firmly believe they were clear about their terms for subscription services. However, customers do not agree, and neither does the FTC.

The FTC Crackdown on Online Free Trials

In August, the FTC began shutting down websites that they felt were deceptive. One example was a site offering free help to obtain federal grant money. However, customers simultaneously signed up for unrelated services like insurance or identity theft protection if they didn’t “opt out” within a few days.

The FTC states that automatically enrolling a customer in a paid service through a checkout without clearly stating what the customer should expect is unacceptable. That means businesses cannot auto-check boxes for opting in, nor can the box be hidden “below the fold” of the screen monitor.

Partnering with Visa and the Better Business Bureau, the FTC has set up an alert and published tips on how to protect consumers from deceptive marketing scams. Visa has posted that they are more than willing to reverse fraudulent charges made by deceptive marketing practices, and the FTC is cracking down on businesses who are running these types of scams.

Should You Change Your Website?

So what can you do? If you offer free trials with an additional enrollment requirement, be sure you highlight to the customer what their responsibilities are. Clearly state whether you intend to make recurring charges if you collect their credit card number during the checkout process. In addition, give customers more than a few days (or hours) in which they can “opt out” of an enrolled service. In the end, you will have more happy customers and avoid getting shut down by the FTC.