Incentivized reviews: what the FTC rule allows, what it bans, and what still works
Incentivized reviews are legal in the United States when the reward is offered for any honest review regardless of rating and the incentive is disclosed. Since 21 October 2024 they are illegal when the reward is conditioned on a positive review, when negative reviews are suppressed, or when an insider connection is hidden. Penalties reach $51,744 per violation.
This post is a marketing guide, not legal advice. Have counsel read your program against the rule before launch.
What the FTC rule actually says
The Trade Regulation Rule on the Use of Consumer Reviews and Testimonials, 16 CFR Part 465, was announced by the FTC on 14 August 2024 after a 5 to 0 vote, published in the Federal Register on 22 August and took effect on 21 October 2024. It lets the agency seek civil penalties of up to $51,744 per violation, adjusted annually for inflation. For ecommerce brands, five provisions matter:
- Incentives conditioned on sentiment are banned. You may not offer compensation or anything of value in exchange for a review expressing a particular sentiment, positive or negative, whether the condition is stated or implied. A discount for a review is allowed; a discount for a five-star review is not.
- Fake reviews are banned. No reviews written by people who did not use the product, no AI-generated reviews presented as customers, and no buying them from anyone else.
- Review suppression is banned. You may not use legal threats or intimidation to remove negative reviews, and you may not present a review section as complete when you have hidden reviews by rating.
- Insider reviews must be disclosed. Reviews from employees, agents and their relatives must disclose the connection; reviews from officers and managers are prohibited outright.
- Fake engagement is banned. Buying followers, likes or views from bots or hijacked accounts for commercial purposes is a violation.
Separately, the marketplaces set their own rules. Amazon prohibits incentivized reviews on its own platform entirely, outside its Vine program. The guidance below is for reviews collected on your own store and syndicated through platforms such as Okendo, Yotpo or Judge.me.
Do incentives actually work?
Yes, when the baseline is low. Okendo’s March 2024 benchmark put the typical review rate at 2.5% to 5% of orders, with the top decile of brands at 22%, and the gap is mostly timing and incentive. The reason to close it is conversion: PowerReviews’ April 2022 study found shoppers who interact with reviews convert at a 128% higher rate, and Bazaarvoice’s 2022 research, still its current reference, found photo and video reviews lift conversion 150%.
The constraint is trust. Bazaarvoice’s Shopper Experience Index, published 30 September 2025 from more than 7,000 consumers, found 43% of shoppers look for reviews as their most common step after discovering a product, and 46% named authenticity as their top frustration. An incentive that produces 300 identical five-star reviews in a week does not read as proof; it reads as a scheme, and shoppers discount it before the FTC does.
Which incentives stay inside the rule
| Incentive | Allowed? | Condition that keeps it legal |
|---|---|---|
| Loyalty points for any review | Yes | Same points for one star as for five; disclose that the review was incentivized |
| Discount code on next order | Yes | Issued after submission regardless of rating; the code, not the review, is the reward |
| Entry into a monthly draw | Yes | Open to every reviewer; follow state sweepstakes rules and publish odds and terms |
| Extra reward for a photo or video | Yes | Reward the format, never the sentiment; disclose it |
| Early access or a members-only perk | Yes | Granted for reviewing, not for rating; disclose it |
| Discount for a five-star review | No | Conditioned on sentiment; the core violation |
| Refund or gift to remove a negative review | No | Suppression; also a violation if the review is hidden by rating |
| Employees or family reviewing without disclosure | No | Insider review; officers and managers may not review at all |
| Review gating (ask happy customers publicly, unhappy ones privately) | No | Treated as suppression when it hides negative reviews from the public total |
How to disclose it
Two disclosures, in two places. On the review itself, the platform badge that marks it as incentivized: Okendo, Yotpo and Judge.me each support a label and it should be on, not off. In the ask, one plain sentence that says what the customer gets and that any honest review qualifies: ‘Leave a review, any rating, and we will add 200 points to your account.’ That sentence is also the one that keeps the review rate honest, because customers who were going to leave one star still leave it, and the aggregate rating stays believable. Our review request email guide has the full ask written out, and our comparison of the best Shopify review apps notes which platforms label incentives correctly.
Where the incentive sits in the lifecycle
The review request is one message in the post-purchase flow, timed per product category after delivery, with one reminder. It is not a campaign. The incentive is most effective when it connects to a program the customer already values, which is why loyalty points outperform a discount code for brands that run a program; the points land in a balance the customer is already watching, and our loyalty program agency builds the two together. In client accounts the post-purchase sequence is where the review ask lives: for Darc Sport the rebuilt Klaviyo automations, post-purchase included, now drive 30% of total email revenue and for Kinetic Kings new and expanded automations produced an 89% year-over-year increase in flow revenue The post-purchase flow playbook shows the timing. The reviews and UGC program team at BMO Media builds the collection, the disclosure and the syndication so the proof does the selling and the rule is never in question; our guide to UGC marketing for ecommerce covers what to do with the content once it arrives.
