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Event Description

The Federal Trade Commission hosted a public workshop in Washington, DC on September 15, 2016 to examine the testing and evaluation of disclosures that companies make to consumers about advertising claims, privacy practices, and other information.

Effective disclosures are critical in helping consumers make informed decisions in the marketplace.

  • Many advertisers have used disclosures in an attempt to prevent their advertisements from being deceptive. Disclosures must be crafted with care both with respect to their language and presentation. Disclosures used in the marketplace are sometimes ineffective.  Commission staff has recommended that disclosures be tested for effectiveness.
  • Disclosures are also challenging in the privacy arena, whether disclosing to consumers that their physical location or online interactions are being tracked, or explaining privacy practices when consumers sign up for a service. Privacy policies are often long and difficult to comprehend and privacy-related icons may fail to communicate information meaningfully to consumers. Furthermore, the accompanying mechanisms for consumers to provide informed consent or exercise choices about the use of their data may also be confusing. The Commission has long encouraged the development and testing of shorter, clearer, easier-to-use privacy disclosures and consent mechanisms.
  • The FTC has issued guides to help businesses avoid deceptive claims, such as guidance related to endorsements, environmental claims, fuel economy advertising, and the jewelry industry. Often the guidance presents options for qualifying claims to avoid deception. In developing guides, the Commission has sometimes relied on consumer research to gauge whether specific disclosures can be used to qualify otherwise misleading claims.

The FTC has a long commitment to understanding and testing the effectiveness of consumer disclosure, and is especially interested in learning about the costs and benefits of disclosure testing methods in the digital age. A number of factors impact the effectiveness of disclosures, including whether they contain the most essential information and consumers notice them, direct their attention towards them, comprehend them, and are able to use that information in their decision making. Some testing methods are more appropriate than others for evaluating these factors.

The workshop is aimed at encouraging and improving the evaluation and testing of disclosures by industry, academics, and the FTC. The FTC’s workshop will explore how to test the effectiveness of these disclosures to ensure consumers notice them, understand them and can use them in their decision-making. It is intended to further the understanding of testing and evaluation of both offline and online consumer disclosures, including those delivered through icons, product labels, short text, long text, audio or video messages, interactive tools, and other media. Topics may include evaluation criteria, testing methodologies and best practices, case studies, and lessons learned from such testing.

The FTC live-tweeted the conference from @TechFTC using the hashtag #FTCDisclosures.

See photos from the event on FTC's Facebook page.

  • Materials Referenced in Speaker Presentations

    7:45 - 9:15 am

    Registration

    9:15 - 9:30 am

    Introductory Remarks

    Lorrie Cranor
    Chief Technologist, FTC


    Opening Remarks
    Edith Ramirez
    Chairwoman, Federal Trade Commission

    9:30 -10:00 am

    Cognitive Models
    This session will provide an introduction to the cognitive models that help explain how people process disclosures when they encounter them.

    Michael S. Wogalter
    Professor Emeritus of Psychology, North Carolina State University
    “A Cognitive Framework to Assess Disclosure Effectiveness: Communication-Human Information Processing (C-HIP) Model”

    10:00 - 10:30 am

    Evaluation Procedures and Methods
    This session will provide an overview of the procedures and methods to evaluate disclosure effectiveness and a discussion of the costs and benefits of using various evaluation procedures and methods.

    Ilana Westerman
    CEO and Co-founder of Create with Context, Inc.
    “Evaluation Methodologies for Trusted Experiences”

    Craig Andrews
    Department of Marketing, Marquette University
    “Tradeoffs and Traps in Testing Disclosures”

    10:30 - 11:00 am

    Morning Break
    Refreshments are available for purchase in the Constitution Center cafeteria. Food and drink may not be brought into the auditorium at any time.

    11:00 am - Noon

    Your Attention Please!
    This session will discuss studies that evaluate whether and when people are noticing, reading, or paying attention to disclosures.

    Moderator:
    Michael Ostheimer, Attorney, Division of Advertising Practices, FTC

    Panelists:

    Nathaniel J. Evans, Department of Advertising & Public Relations, University of Georgia
    “Disclosure Modality in Advergames: Effects and Implications for Policy”

    Mariea Grubbs Hoy, School of Advertising & Public Relations, University of Tennessee
    “Do Consumers Read Disclosures:  Field of Dreams or Impossible Dream?”

    David Hyman, Epstein Program in Health Law and Policy, University of Illinois
    “Do Users Even Notice Online Disclosures/Labels?  Can We Do Better?”

    Rebecca Balebako, Information Scientist, RAND Corporation
    “The Impact of Timing on the Salience of Smartphone App Permission Notices”

    Noon - 1:00 pm

    Comprehension
    This session will discuss studies that evaluate whether people understand the information conveyed in disclosures.

    Moderator:
    Ryan Mehm
    Attorney, Division of Privacy and Identity Protection, FTC

    Panelists:

    Daniel Goldstein, Principal Researcher, Microsoft Research Lab – New York City
    “Presenting Unfamiliar Numbers to Laypeople (and Checking Comprehension)”

    Elizabeth Howlett
    Department of Marketing, University of Arkansas, Fayetteville
    “Front of Package Nutrition Labeling : One Size Does Not Fit All”

    Susan Kleimann
    President, Kleimann Communication Group
    “Going Beyond Words: Assessing Comprehension at a Deeper Level”

    Joel R. Reidenberg
    Center on Law and Information Policy, Fordham University
    “Ambiguity in Privacy Policies”

    1:00 - 2:00 pm

    Lunch

    Lunch is available for purchase in the Constitution Center cafeteria or from nearby restaurants and food trucks. Note that if you leave the building for lunch you will have to go through security again when you return.

    2:00 - 3:00pm

    Impact on Decision Making and Behavior
    This session will discuss studies that evaluate the impact that disclosures have on consumers’ decision making and behavior.

    Moderator:

    Janis Pappalardo
    Asst. Director for Consumer Protection, Bureau of Economics, FTC

    Panelists:

    Lillian Ablon
    Information Scientist, RAND Corporation
    “Into the Breach: Consumer Attitudes Toward Data Breach Notifications and Loss of Personal Information”

    Idris Adjerid
    Information Systems, Mendoza College of Business, U. of Notre Dame
    “Framing, Disclosures, and the Rationality of Privacy Choices”

    Ginger Zhe Jin
    Director, Bureau of Economics, FTC
    "The Economic Insights of Information Disclosure”

    Adair Morse
    Finance Group, Haas School of Business, UC Berkeley
    “Debiasing Disclosures: Progress and More Work Needed”

    3:00 - 4:00 pm

    Case Studies

    In this session, panelists will each present a series of disclosure research studies and discuss a variety of study methods.

    Moderator:

    Hampton Newsome
    Attorney, Division of Enforcement, FTC

    Panelists:

    Colin Campbell
    Dept. of Marketing and Entrepreneurship, Kent State University
    “When Disclosure May Not Be Enough: Social Media, Native Advertising and Multiple Ad Recognition Cues”

    Sarah J. Farnsworth
    Vice President, Scientific Affairs, PEGUS Research, Inc.
    “Methods for Testing Consumer Comprehension of Product Labeling: Implications for Putting Disclosures to the Test”

    Manoj Hastak
    Dept. of Marketing, Kogod School of Business, American University
    "Assessing the Efficacy of Qualifying Disclosures in Advertising: Methodological Considerations"

    Heidi Johnson
    Office of Research, Consumer Financial Protection Bureau
    “Disclosure Research in the Lab”

    4:00 - 4:30 pm

    Break
    4:30 - 5:20 pm

    The Future of Disclosures?

    In this session, panelists will discuss studies that evaluate new approaches or new applications of existing approaches to disclosure design and presentation that aim to make disclosures more efficient and effective.

    Moderator:

    Joseph Calandrino
    Research Director, Office of Tech. Research & Investigation, FTC

    Panelists:

    Serge Egelman
    UC Berkeley / International Computer Science Institute
    “Improving Disclosure through Contextual Integrity”

    Tamar Krishnamurti
    Dept. of Engineering & Public Policy, Carnegie Mellon University
    “A Patient-Centered Approach to Informed Consent”

    Florian Schaub
    School of Information, University of Michigan
    “Contextualizing and Personalizing Privacy Notices and Controls”

    5:20 - 5:30pm

    Closing Remarks

    Jessica Rich
    Director, Bureau of Consumer Protection, FTC

     

  • Request for Comments

    The FTC also invites the public to submit comments in connection with the workshop.

    Interested parties may file a comment electronically at https://ftcpublic.commentworks.com/ftc/disclosuretestingworkshop.

    Alternatively, paper comments may be mailed to Federal Trade Commission, Office of the Secretary, 600 Pennsylvania Avenue N.W., Suite CC-5610 (Annex B), Washington, DC 20580, or they may be delivered to Federal Trade Commission, Office of the Secretary, 400 7th Street SW, 5th Floor, Suite 5610 (Annex B), Washington, DC 20024.  Please write “Disclosure Testing Workshop Project No. P 164503” on your comment so that it will be readily identified with this workshop.

    The public comment period will remain open until November 2, 2016. Comments will be posted on the workshop’s public webpage.

FTC Privacy Policy

Under the Freedom of Information Act (“FOIA”) or other laws, we may be required to disclose to outside organizations the information you provide when you pre-register. The Commission will consider all timely and responsive public comments, whether filed in paper or electronic form, and as a matter of discretion, we make every effort to remove home contact information for individuals from the public comments before posting them on the FTC website.

The FTC Act and other laws we administer permit the collection of your pre-registration contact information and the comments you file to consider and use in this proceeding as appropriate. For additional information, including routine uses permitted by the Privacy Act, see the Commission’s comprehensive Privacy Policy.

This event is open to the public and may be photographed, videotaped, webcast, or otherwise recorded. By participating in this event, you are agreeing that your image — and anything you say or submit — may be posted indefinitely at ftc.gov or on one of the Commission's publicly available social media sites.