Why Fiverr UGC Is Dangerous for Your Brand Starting Oct 2024

The Federal Trade Commission recently enacted a landmark ban on fake endorsements, which took effect in October 2024 and killed traditional pay-for-post influencer marketing as we knew it. This new regulation, passed by a unanimous bipartisan FTC vote, aims to restore trust in influencer and user-generated content by enforcing strict penalties for deceptive practices.

‍

🚨 $43,792 fine per violation

🚨 First enforcement case raised in November 2024

🚨 90% of influencers admit to non-compliance

🚨 80% of consumers lose trust instantly upon noticing deception

‍

The ban mandates that all testimonials and product reviews—whether written, video, or image—must reflect genuine consumer experiences. With fines of up to $43,792 per piece of content, brands can no longer afford to risk misleading endorsements. Yet a quick look at Fiverr’s UGC (User Generated Content) services reveals a troubling trend: freelancers offering to create reviews, testimonials, and product endorsements—services that could easily fall into deceptive territory.

In this article, we’ll examine Fiverr’s UGC offerings with specific screenshots and examples, highlighting how these services may mislead consumers and jeopardize brands’ compliance with FTC rules.

Step 1: Initial Notification for UGC Services on Fiverr

‍

Upon logging into Fiverr, I received a notification suggesting I explore “Fiverr UGC creators” who are “ready to deliver product reviews, tutorials, testimonials, and more.” This message immediately raises a red flag, as it implies that these services include creating product testimonials and reviews—content types that the FTC requires to be authentic and reflective of real customer experiences.

‍

‍

Step 2: Searching for UGC Services on Fiverr

When I clicked on the notification, Fiverr displayed over 9,700 results for UGC creators...bruh. These results included service providers offering various types of content, from product reviews to “authentic” testimonials, in formats that mimic real user experiences.

‍

Step 3: Analyzing Top-Rated UGC Service Providers

In the results, I noticed several top-rated UGC providers, with listings promising high-quality testimonial videos and “natural” endorsements. Here’s a closer look at some of these services:

Issues with the Services in the Screenshot

1. Authenticity Concerns: Many of these services advertise “natural” or “authentic-looking” endorsements, which suggests they aim to make content appear genuine—even if it’s scripted and paid for by the brand.
2. Absence of Real User Experience: The creators likely haven’t used the products they are endorsing, as they are hired solely to create promotional content. This directly conflicts with the FTC’s requirements for testimonials to be based on real experiences.
3. Potential for Deceptive Marketing: These services are effectively creating paid advertisements disguised as user reviews. When consumers encounter such content, they might assume it reflects genuine user satisfaction, when in reality, it’s orchestrated for marketing purposes.

Step 4: Clicking on a Specific UGC Service Provider

Curious to see an example of the content being created, I clicked on the first provider in the list, who boasts 229 five-star reviews for their UGC services. In the sample video, the creator delivers a scripted endorsement for “Abby’s Cashew Butter.”

Quote from Sample Video:
“If you're looking for a delicious snack, stop scrolling. Abby's Cashew Butter has completely changed snack time in my house... say goodbye to boring old peanut butter. This cashew butter is plant-based, gluten-free, and non-GMO.”

This statement is presented as a personal experience, but it was produced by a Fiverr freelancer who markets himself as follows:

“I'm a voice actor, comedian, and content creator with over 10 years of experience working with film and audio. I've worked with some of the biggest brands in the world and know how to create an authentic, engaging video!”

Such endorsements are problematic because they create the illusion of genuine consumer advocacy, which is exactly what the FTC’s new ban on deceptive endorsements aims to prevent.

‍

Step 5: Verifying the Product’s Credibility

To investigate further, I searched for Abby’s Cashew Butter on Amazon. The brand was currently out of stock and had an average rating of 3.5 stars—a stark contrast to the glowing testimonial in the Fiverr sample. This discrepancy raises questions about how many of the positive reviews or video testimonials for this brand are legitimate and how many were simply paid Fiverr gigs.

‍

‍

Implications of Using Fiverr’s UGC Services for Brand Compliance

The services offered on Fiverr may seem appealing for brands looking to promote their products cost-effectively. However, there are significant compliance risks:

‍

1. FTC Violations and Financial Penalties: The FTC’s recent ban on deceptive endorsements, effective October 2024, requires brands to ensure that all testimonials reflect genuine consumer experiences. Using Fiverr-generated testimonials that simulate “authentic” experiences without actually representing the creators’ true opinions can easily result in regulatory violations and hefty fines.

‍

2. Erosion of Consumer Trust: Consumers are increasingly skeptical of influencer and UGC content. Discovering that a brand’s testimonials were fabricated by freelancers paid to act as satisfied customers could significantly damage the brand’s credibility and trustworthiness.

‍

3. Legal Precedent – Drunk Elephant Case: The NAD has already demonstrated its commitment to enforcing the FTC’s new ban on deceptive endorsements, as seen in cases like Drunk Elephant surfaced in early November 2024. This case exemplifies the risks for brands that rely on fake testimonials, emphasizing that they could face serious legal repercussions if found non-compliant.

‍

Safe Alternatives To Getting Fiverr from UGC

With the FTC’s crackdown on misleading endorsements now in full effect, brands need to prioritize authenticity and compliance in their marketing strategies. Here are some safer alternatives to ensure your User Generated Content (UGC) aligns with FTC guidelines while maintaining consumer trust:

1. Work With Verified Creators Who Are Verified Customers

• Instead of relying on generic UGC freelancers, collaborate with creators who are genuine customers of your brand. These individuals can share authentic experiences that resonate with audiences and fulfill FTC requirements for truthful endorsements.
• Use tools like SwayID to identify creators who already engage with your brand, ensuring their testimonials reflect real user experiences.

2. Screen UGC for Compliance Before Acceptance

• Establish a review process to evaluate all UGC before publishing. Look for red flags like overly scripted endorsements, generic product claims, or a lack of personal anecdotes that suggest the creator hasn’t actually used the product.
• Consider using tools like SwayID's UGC FTC compliance checker or third-party services to verify that all UGC meets FTC standards before it goes live.

3. Partner With Trusted Platforms Proficient in FTC Compliance for UGC Campaigns

• Use reputable UGC platforms that specialize in ensuring compliance, authenticity, and transparency.
• Avoid platforms that prioritize volume over quality, as these are more likely to produce non-compliant content.

4. Educate Freelancers About FTC Compliance

• If you decide to source UGC freelancers, ensure they are well-versed in FTC guidelines. Provide them with a clear brief that outlines compliance requirements, including the need for truthful experiences and proper disclosures.
• Conduct periodic training sessions or provide resources to keep them updated on evolving regulations.
• Point freelancers to educational materials such as SwayID's FTC compliance course catalog to encourage them to stay educated.

By prioritizing compliance and authenticity in UGC campaigns, brands can navigate the new FTC regulations effectively while building consumer trust. Missteps in this area are no longer a minor risk—they’re a direct threat to brand reputation and financial stability. Choose safer, transparent alternatives to thrive in this new regulatory landscape.

‍