A U.S. advertising watchdog ignites a fierce PR battle between insulation manufacturers
April 18, 2017 by John Bleasby
Accusations of false or misleading advertising against a leading American manufacturer of cellulose insulation has the industry’s manufacturers’ association up in arms, even threatening legal action against a popular media outlet. This stems from a report released by the National Advertising Division (NAD) of the U.S. Better Business Bureau back in June 2016 suggesting that Applegate Insulation had misrepresented its product’s advantages in company marketing literature.
Applegate Insulation is based in Webberville, Michigan and describes itself as “the world’s largest family-owned manufacturer of cellulose insulation products.” Cellulose insulation is produced mainly from recycled newspapers, which are shredded and treated with fire-retardant chemicals. This has made it popular among end users with environmental concerns. Applegate has six manufacturing plants in the United States. In September 2015, the company purchased its first Canadian manufacturing facility in Rodney, Ontario from the environmental firm International Erosion Control Systems, and is looking at further expansion in Canada.
Cellulose insulation marketing claims called into question
The NAD had responded to complaints from the North American Insulation Manufacturers Association (NAIMA) and ultimately recommended that Applegate Insulation stop making certain claims regarding the superiority of their cellulose product. According the the Advertising Self-Regulatory Council (ASRC), the NAD said that Applegate’s marketing contained “evidence insufficient to support the challenged comparative performance claims” of cellulose versus other forms of home insulation. In particular, the NAD objected to Applegate’s reliance on “studies at universities, national laboratories, private research facilities and hundreds of homes and buildings [showing] that cellulose is from 20% to 50% more effective than fiberglass,” and that “extensive and expensive air sealing measures must be used for fiberglass buildings to approach the tightness of buildings insulated with cellulose.” There were also claims in Applegate’s marketing material that, according to the NAD, alluded falsely to certain health benefits of their product.
Manufacturers’ association comes to Applegate’s defense
The Cellulose Insulation Manufacturers’ Association (CIMA) quickly responded to Canadian Contractor’s request for comment. Daniel Lea, Executive Director of CIMA in both Canada and the United States said, “Applegate’s statements of cellulose insulation performance superiority are based on independent studies and surveys that were widely reported starting in the mid-1980s.” Lea also said, “The NAD justifies discounting the significance of these studies because, 1) they are old, and 2) fiberglass products ‘have changed since then.’ ” Yet Lea challenged and questioned the NAD methodology saying, “The NAD doesn’t seem to have asked how they [fiberglass products] have changed or demanded any supporting documentation of the alleged changes.”
Legal action threatened over media reports
However, the issue doesn’t end there. Coverage by Huffington Post’s John Burnett, published on March 17, 2017 concerning the NAD report took the issue to another level, aggravating CIMA even further. In a separate release, Lea called various statements made in the Huffington Post article “false, misleading and libelous,” adding that, “Several members of CIMA are demanding immediate legal action against Burnett [the author] and any individual or entity that aids in disseminating his false and malicious statements. Before taking this step CIMA wishes to afford Burnett and the Huffington Post the opportunity to retract his comments.”
Applegate reaction? Stay calm and fight on!
While willing to abide by the NAD recommendations, Applegate Insulation itself is somewhat sanguine yet ready for future challenges. Canadian Contractor spoke to Richard Applegate, Sales Manager and son of one of two company co-founders. “There are two pieces of literature that we’ve agreed to revise because of data that is old, and because the fiberglass industry says that their product has changed,” he said. “We don’t agree that the data is wrong, but because it’s old we’re going to remove it.”
However, Applegate is not about to lie back. He believes the company’s products do in fact have superior characteristics, and he’s out to prove it. “We’re looking for research that shows that the fiberglass product has not improved, it’s actually worse. It’s less dense today than it was back in 1991,” he said. “What we have to do, because of our agreement, is have more current research data and not be relying on something that’s 20 years old.”
At the same time, Applegate welcomes the attention the issue has received. “The fact that we’re having this conversation is quite amazing,” he said. “We think it’s probably better PR for us that this has happened than if it didn’t, if the truth gets out as a result. Although we’re one of the largest cellulose manufacturers, we’re like the little pinky finger in terms of the market. That the fiberglass industry would even care to have anything to do with us is a little bit flattering.”
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