A New Year, A New FTC Subscription Action

The Bottom Line

• Subscription traps, insufficient pricing disclosures and hidden fees are top of mind for both the FTC and state regulators.
• Subscription-based businesses, especially those using ancillary practices such as algorithmic pricing, are particularly vulnerable to challenge. Companies should carefully consider if their personalization practices trigger disclosure requirements in New York or elsewhere.
• A/B and experimental testing can impact a company's risk exposure – particularly if advertisers use them to prioritize conversion over compliance.
• Advertisers across all industries should expect increased scrutiny of pricing and billing practices and act now to ensure compliance. That includes fully auditing all e-commerce practices, including initial advertised offers, disclosures made to consumers, affirmative consent mechanisms, cancellation flows and retention "save" flows.