Transcript
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FalseAdvertising
By:DeannaNanni
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Outline:
1. Abstract
a. Describingthepaper
2. BodyofthePaper
a. WhatisFalseAdvertising?
i. Whyfalseadvertisingoccurs.
ii. WhattheFederalTradeCommissiondoesversewhatFederal
CommunicationsCommissiondoes.
iii. Whyfalseadvertisingcanbeconsidereddeceptiveadvertising.
iv. Advertisinglawverseconsumerlaw.
b. TheTypesofFalseandMisleadingAdvertising
i. Fivedifferentbusinesstacticsthatconsumersneedtowatch
outfor.
ii. BaitandSwitch
iii. HighPressure
iv. DeceptiveformContracts
v. ArtificiallyInflatingPrices
vi. Failuretodisclosure
c. ACaseExemplifyingFalseAdvertising
i. LordandTaylor
1. FTCChargesItDeceivedConsumersThroughPaidArticle
inanOnlineFashionMagazineandPaidInstagramPosts
by50“FashionInfluencers”.
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d. ExampleofFalseAdvertising
i. LaneBryantAd
ii. Exemplifyingthefivetacticsdiscussedearlier.
3. Conclusion
i. Falseadvertisingandhowitsurroundsus.
Abstract:
Thispaperexamineswhatfalseadvertisingis,whattolookforinan
advertisementifyoubelieveitisfalse,andhowyoucansueifyouareharmedbythe
falseadvertisement.Thisisanimportantissuetoaddressintodaysworldbecause
peoplearetryingtosavemoney,andadvertisersaregettinggoodatconvincing
peopletobuyitemstheydonotneed.Ifocusontheconsumerandhowhe/shecan
lookoutforfalseadvertisements.Itispossibletobringafalseadvertisementcaseto
courtifyouaredirectlyaffectedbythead.Ialsoshareanexampleofanadusedby
“LaneBryant”promotingoneoftheirsales.Thetheoryofthispaperissupportedby
primarysourcessuchasrecentcases,theFCC,andtheFTC.Ialsoincludesecondary
sourcesfromarticlesandTruthinAdvertising.Thispaperportraystheimportance
offalseadvertisingandhowitsurroundsconsumer’severyday.
ResearchQuestion:
Whatisfalseadvertisinganddoyouknowwhenyouarebeingexposedtofalse
advertisements?
TextofPaper:
Whatisfalseadvertising?
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Advertisementssurrounduseveryday.Whendriving,billboardsareon
majorhighways,whentakingpublictransportationsadvertisementssurroundthe
wallsofthebusortrains,andwhenwaitingforabusthebusstopsevenhaveads.
Thoseadsaresupposedtogivepeopletruthfulinformationandinformcustomers
onnewproducts.Butsomeadsarenotalwaystruthfulandthatiswhyfalse
advertisingissuchanimportantissue.Companiesaredesperateforsales,whichis
whytheywilltryextrahardfortheiradtoattracttherightaudience.“Today,
companiesareevenmoredesperateforsales,asfamiliesclingalittletightertotheir
dollars”.1Sincefamiliesarealwaystryingtosavemoney,companieswilldo
whatevertheycantoappealaconsumerifitevenmeansputtingoutafalsead.“By
federallawalladsmustbetrueandwhenTheFederalTradeCommissionhasfull
controloverthat.“TheFTClooksespeciallycloselyatadvertisingclaimsthatcan
affectconsumers’healthortheirpocketbooks–claimsaboutfood,over-the-counter
drugs,dietarysupplements,alcohol,andtobaccoandonconductrelatedtohigh-
techproductsandtheInternet.TheFTCalsomonitorsandwritesreportsaboutad
industrypracticesregardingthemarketingofalcoholandtobacco”.2
TheFederalCommunicationsCommissionworkshandinhandwiththe
FederalTradeCommission.“Broadcastersareresponsibleforselectingthe
broadcastmaterialthatairsontheirstations,includingadvertisements”.3TheFCC
expectsthebroadcastersnottoairanymisleadingorfalseadvertisements.TheFTC
isresponsiblefordeterminingifanadisfalse.
Falseadvertisingcanbeknownasdeceptiveadvertisingormisleading
advertising.Deceptiveadvertising“referstoamanufacturer’suseofconfusing,
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misleading,orblatantlyuntruestatementswhenpromotingaproduct.Advertising
lawwillprotectconsumersfromdeceptiveadvertisingthroughtheenforcementof
specificlegislation.Advertisinglawandconsumerlawhasbasicallythesame
function:topromotetruthinlabeling”.4Consumerlawis“Astateorfederallaw
designedtoprotectconsumersagainstimproperlydescribed,damaged,faulty,and
dangerousgoodsandservicesaswellasfromunfairtradeandcreditpractices”.5
“Advertisinggenerallyreferstopaidformsofcommunicationthataredistributedat
theinitiativeofeconomicoperators(radio&television)aspartofanintentionaland
systematicefforttoaffectindividualattitudesandchoicesinrelationtothe
consumptionofgoodsandservices.6“Misleadingadvertisingisanypublishedclaim
thatgivesaconsumeranincorrectunderstandingoftheproducttheyareinterested
inpurchasingorusing”.7Whenbusinessesadvertisetheymustbetruthful.“No
businessmaymakefalse,misleading,ordeceptiveclaimsaboutaproductregarding
its:price,quality,andpurpose”.8Ifacustomersuffersafinancialloss,oranyother
kindofdamageduetomisleadingadvertisingcanparticipateinaclassaction
lawsuittorecovercompensation.9
TheTypesofFalseandMisleadingAdvertisingTactics
Companiesusetacticstolurecustomersintobuyingaproduct.Thereare
quiteafewtacticsthatcompaniesusebutherearefiveofthem.Oneiscalled“Bait&
SwitchAdvertising”.10Thisiscommonlyseeninacircularormagazinewherethe
companyadvertisesaproductthatitdoesnothave.Itusuallyisonsale,sothe
customerismoreinclinedtobuy.Butoncethecustomerentersthestore,thestore
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normallydoesnothaveit,sotheyofferthecustomerasubstitutebrand,whichis
moreexpensivethantheoriginalitemtheyadvertisedbefore.Amorecommonly
seen“BaitandSwitch”tacticiswhenacardealershiprunsanadthataluxurycar
hasdroppedfrom$40,000to$25,000.Theypostthatadsotheycanlurecustomers
tocomeintothedealershipandcheckoutthedifferentcarstheyhave.Oncea
customerwalksinaninquiresabouttheadhe/shewillaskaboutthedealandthe
salespersonwillmakeitsoundslikethedealershiponlyhadoneortwomodels
listedatthatpriceandtheyalreadysoldthem.Whatcanaconsumerdotoprotect
him/herselfineventthishappens?One,ifyouarealreadyatthedealershipyoucan
asktoseethetransactionmadebeforehandtomakesuretheywerenotlying.Truth
inadvertisingsays,“Onestepyoucantakeistocallaheadtoanystoreorshowroom
tocheckthattheproductinquestionremainsinstockandavailableforsale.Besure
toaskforthenameofthesalespersonwithwhomyouarespeakingsothatyouare
abletoreportnotonlythecompanybutalsothespecificsalespersontotheFTCin
theeventacomplaintisfiled”.11
Thenextoneiscalled,“High-PressureSalesTactic”.12Thisnormallygetsa
consumertopurchaseaproducthe/shedoesnotneedorwant.Thisisusuallyseen
throughtelemarketersoranunsolicitedsalesperson.Thebestwaytoavoidgetting
caughtinto“highpressure”istoplaceyourphonenumberona“DoNotCallList”.It
isalsoimportanttomakedecisionsbeforehandinsteadofmakingthemonthespot.
Giveyourselftimetothinkofadecisionbecauseyoucanalwaysgobacktothe
place.Lastly,donotletunsolicitedsalespeopleintoyourhome.Makesuretodothe
homework-researchisveryimportantbecauseitwillsavethecustomertimeand
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beabletomaketherightdecision.Next,understandsalestactics.Salespeoplehave
toreachdeadlines,beawareiftheymentionthisisthelastsofa,orpriceswill
double.Lastly,stopthechatter.Maintainrelationshipswiththesalespersonand
knowwhentocutofftheconversation.Ultimatelytheconsumerisincontroland
shouldbeabletosteerawayfromhigh-pressuresalestactics.13
Nextis,“DeceptiveformContracts”whichiscontractsoragreementsthat
havefineprintoraretoocomplicated.14Theconsumercaneasilyoverlookthis
agreement.AccordingtoTruthinAdvertisingaconsumershouldalwaysreadthe
fineprint.Asaconsumeritisimportanttorememberthatadvertisersaretryingto
sellussomething,andtheycantakeadvantageofusbysayingthefineprintsuper
fastinaradiocommercial,orinanadhavingthefontbesupertinycomparedtothe
headlineandbodytext.15Disclosuresshouldbeclear,whichmeansitshouldnotbe
hidden.Thereisnoruleonhowtinyfontshouldbeorhowlongitismentionedfor
ontheradioortelevision.“TheFTCdoesusea4-prongedtesttodetermineifan
ad’sfineprintpassesmuster:Prominence,presentation,placement,and
proximity.”16Prominencehastodealwithfontsize-canpeoplereadandnotice?
Presentationreferstothewayitissaidandthelayoutofthedisclosure.Next,the
placementreferstowherethedisclosureislocated.Lastly,areproximityandthe
fineprintneartheclaimitqualifiesfor?Iftheconsumercananswernotoanyof
thesefourrulesthenthefineprintdoesnotmeetthestandardsofthelaw.17
Therecanalsobe“ArtificiallyInflatingPrices.”18Thisiswhenaconsumer
seesanadoracommercialandthedealseemstobegreat.Butoncetheconsumer
lookscloselyorinquiresaboutthedealhiddenfeesmaybeinvolved.
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Lastly,“Failuretodisclosure”iswhenthecompanyforgetstotelltheconsumera
dealhasexpiredornotavailableanymore.19Ifaconsumerhasexperiencedfalseor
misleadingadvertisinghe/shemaybeawardedavarietyofremedies.Remedies
include:“Monetarydamages,injunctionsorderingthebusinessestostoprunning
theadvertisements,injunctionsorderingthebusinessestostopengagingin
deceptivepractices,andinjunctionsorderingthebusinessestoincludedisclosure
statementsintheiradvertising.”20“TheSupremecourtrarelytakescareoffalse
advertisingcases.”21Ifaconsumerwantstobringafalseadvertisingcasehe/she
shouldfileasuitinacivilorsmallclaimscourt.22
CaseexemplifyingFalseAdvertisingLordandTaylorSettlesFTCChargesItDeceivedConsumersThroughPaidArticleinan
OnlineFashionMagazineandPaidInstagramPostsby50“FashionInfluencers”
LordandTaylorisanationalretailerandFTCchargedthecompanywith
deceivingconsumers“bypayingfornativeadvertisements,includingaseemingly
objectivearticleintheonlinepublicationNylonandaNylonInstagrampost,without
disclosingthatthepostsactuallywerepaidpromotionsforthecompany’s2015
DesignLabclothingcollection.”23LordandTaylorwentaheadandpaid50online
influencerstopostthemselveswearingthesamepaisleydressfromthenew
collectiononInstagram.LordandTaylorfailedtorevealthateachinfluencerwas
paidthousandsofdollarsinexchangeforthetheirendorsementaswellasgiventhe
dress.WhatLordandTaylordidwrongwastheydidnothavetheinfluencerssay
theywerecompensatedinexchangefortheirendorsements.24TheDirectorofthe
FTC’sBureauofConsumerProtection,JessicaRich,said:“Lord&Taylorneedstobe
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straightwithconsumersinitsonlinemarketingcampaigns.Consumershavethe
righttoknowwhenthey’relookingatpaidadvertising.”25TheFederalTrade
Commissionistoreporttoconsumerswhenanadisfalse.HereLordandTaylordid
notdiscloseimportantinformationthattheseendorserswerepaid.
ExampleofFalseadvertisingLaneBryantadvertisement:
Thisisanexampleoffalseadvertisement.Itsays“40%off
entirestoreonabsolutelyeverything!”Butifyounoticethe
smallerprintsays,“excludesDKNYJEANSproducts,SPANX,
andASSETSproducts.”Thisisconsideredfalseadvertising
because“onabsolutelyeverything”and“entirestore”
makesitfalse.Ifaconsumerjustsaw“entirestoreon
absolutelyeverything”he/shehaseveryrighttobelieve
thatLaneBryantmeanseverything.Everythingelseonthis
adisentirelytrue.Tomakethisadtruethestorewould
needtoput“40%off”!“ExcludesDKNYJEANSproducts,SPANX,andASSETS
products.”26
Conclusion:
AsIwanttogointoadvertisingasacareerIstopandthinkaboutthe
advertisementsIseeday-to-day.AsIwalkthroughamallandlookoutstore
windowsatsignsthatsay,“Wholestore40%off”!Ican’thelpbutwonderifthe
storeisactually40%off?Idecidetogointothestoreandofcourseitiseithersale
itemsthatare40%offoritjustexcludesnewarrivals.Thetrickysignworked
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becauseitstillhadmewalkintothestore.Thatiswhyadvertisingworksevenifitis
falseadvertising.OnetopicItalkedaboutisfineprint.It’slegal,aslongasit
correspondswiththeadandthenakedeyecanreadit.Companieshavecruelsales
tacticsthatworkonanyconsumer.Itisourjobasconsumerstonotfallfortheir
tacticsandbeasmartshopper.Baitandswitch,highpressure,deceptiveform
contracts,artificiallyinflatingprices,andfailuretodisclosurewerethetypeoffacts
mentionedinJacobMeyersarticle.Hisarticleinformedconsumerswhattodoin
situationswhenthosetacticsareused.
WithouttheFederalTradeCommissionwewouldnothaveanybody
regulatingtheadvertisementswesee.TheFederalCommunicationsCommission
canthenbroadcasttheadsaftertheFTCregulatesthem.Thesetwofederalagencies
arewhatpreventusfrombeingexposedtofalseadvertisements.Itisnotonly
advertisementstheycanpreventusfromseeing,it’salsocompanieslike“Lordand
Taylor”whousednativeadvertisementspostedthroughInstagram.Thegeneral
publicissupposedtobeinformedwhentheyarebeingexposedtoanad.Thatis
whyInstagramhassponsoredpostsbecauseweknowwearebeinginformed.
Payingpeopletoposeinadresswithoutthegeneralpublicknowingthatendorsers
aregettingpaidforitisjustasfalseasamisleadingadvertisement.
Itisimportantitkeepoureyeoutforadsthataremisleadingorfalse.The
FederalTradeCommissionistoprotectusfrombeingharmedorexposedtofalse
advertisements.Remembertousethetacticsandalwaysthinkbeforepurchasinga
productthroughanadvertisement.AsseenintheLaneBryantadasmentioned,the
fineprintwilltelltheconsumerwhattherealsaleis.Companieswanttomake
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money,andthebestwaytodothatistoluretheconsumerintobuyingaproduct
withagooddeal.Consumerslovebargainsandtheylovetosavemoney!Overall,if
falseadvertisingharmssomeonehe/shemaybringthecasetoasmallclaimscourt.
Alwaysreadthefineprintinanydisclosureofanadvertisement.Lastly,company’s’
tacticsaretotrickconsumersintogettingagooddeal.Neverbefooled.
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Bibliography
PrimarySources:
"Complaints About Broadcast Advertising." Federal Communications Commission. Web. 22 Mar. 2016. Katz, Mitchell J. "Lord & Taylor Settles FTC Charges It Deceived Consumers Through Paid Article in an Online Fashion Magazine and Paid Instagram Posts by 50 "Fashion Influencers"" Federal Trade Commission. 15 Mar. 2016. Web. 22 Mar. 2016. S.Doc.No.2AdvertisingTrendsandConsumerProtection(2009).Print. "Supreme Court Changes False Advertising Law Across the Country." LexisNexis Academic. Legal Monitor Worldwide, 26 Mar. 2014. Web. 22 Mar. 2016. "Truth in Advertising." Federal Trade Commission. Web. 22 Mar. 2016.
Secondary Sources:
"Consumer." Deceptive Advertising Definition -. Web. 23 Mar. 2016. "The Legal Definition of Advertising." AGCM. Web. 23 Mar. 2016. "False and Misleading Advertising." Jacob and Meyers. Web. 23 Mar. 2016. "Bait & Switch Advertising." Truth In Advertising. 2014. Web. 23 Mar. 2016. Better Business Bureau. Start with Trust®. "High Pressure Sales Tactics." Better Business Bureau. 7 June 2013. Web. 23 Mar. 2016. "The Fine Print - Read It." Truth In Advertising. 2012. Web. 23 Mar. 2016. Meem, Sarah. "How to Sue Someone for False Advertising." EHow. Demand Media. Web. 23 Mar. 2016.
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FootNotes
1AdvertisingTrendspg.22FederalTradeCommission3FederalCommunicationsCommission4“Consumer”5“Consumer”6TheLegalDefinition7FalseandMisleadingAdvertising8FalseandMisleadingAdvertising9FalseandMisleadingAdvertising10FalseandMisleadingAdvertising11BaitandSwitch12FalseandMisleadingAdvertising13BetterBusinessBureau14FalseandMisleadingAdvertising15TheFinePrint16TheFinePrint17TheFinePrint18FalseandMisleadingAdvertising19FalseandMisleadingAdvertising20FalseandMisleadingAdvertising21SupremeCourtChangesFalse Advertising Law Across the Country22Meem,Sarah23FederalTradeCommission24FederalTradeCommission25FederalTradeCommission26TheFinePrint
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