Customer testimonials are an important part of a company’s brand. It not only helps validate a product or service, but it allows actual customers to share their experience and offer credibility. I know when I’m looking at making a purchase or trying out a new restaurant or other new venue, I look for blogs, reviews on Yelp and customer testimonials. I want to hear from people who have actually used a product and their experiences with a particular company. Happy people are the best advocates and disgruntled ones are often a sure-fire way to keep potential customers away.

Statistics have shown that more than 70 percent of Americans say they look at product reviews before making a purchase. To that end, a survey found that 90 percent of people who participated said positive reviews influence their buying decisions.

Keeping this in mind, it’s important to note that how customer testimonials are used and developed matters – a lot.

1. Be Authentic. Testimonials need to authentic and not just a sales pitch. Also, if the testimony comes from anyone who has a relationship with the company – i.e. a paid endorser, this should be disclosed. In social media, the hashtag #ad can be used. If a product was sent for review, disclose this. Otherwise, you could be held liable for not disclosing material connections.

2. Accuracy matters. Testimonials also need to be accurate. The Federal Trade Commission (FTC) requires that endorsements reflect honest opinions, findings, and beliefs or experiences of the endorser. They also need to be typical. It doesn’t do anyone any good if an endorsement is less than accurate, especially if it attracted a customer but later results in a negative review because of less-than-honest endorsements.

3. Get Permission. It’s great to receive a letter, e-mail or video with a satisfied customer. However, be sure to get permission in writing to use the comments or endorsement just in case. If the endorser later decides he or she wants to retract their comments, it will protect you from having to remove the testimonial if he or she has agreed in writing that it may be used for a certain period of time. If the testimonial is coming from your company website, make sure to note that any user review submitted may be used for marketing purposes.

This also goes for an endorsement posted elsewhere. Seeing a positive review on another website is great. However, just because a good review has been posted, doesn’t mean you may take it and use it. Not only could this violate intellectual property rights, but you may upset a person happy with your products or services. You want to keep happy customers – happy!

Keeping in mind these few simple tips can help ensure you and your customers are pleased and doing so without encountering legal issues.