Misleading claims, Puffery, fraud, Questionable B2B practices20th February 2021
False advertising is described as the crime or misconduct of publishing, transmitting, or otherwise publicly circulating an advertisement containing a false, misleading, or deceptive statement, made intentionally or recklessly to promote the sale of property, goods, or services to the public. One form of false advertising is to claim that a product has a health benefit or contains vitamins or minerals that it in fact does not. Many governments use regulations to control false advertising. A false advertisement can further be classified as deceptive if the advertiser deliberately misleads the consumer, as opposed to making an honest mistake.
Types of Deception
Often used in cosmetic and weight loss commercials, these adverts portray false and unobtainable results to the consumer and give a false impression of the product’s true capabilities. If retouching is not discovered or fixed, a company can be at a competitive advantage with consumers purchasing their seemingly more effective product, thereby leaving competitors at a loss.
Hidden Fees and Surcharges
Hidden fees can be a way for companies to trick the unwary consumer into paying excess fees (for example tax, shipping fees, insurance etc.) on a product that was advertised at a specific price as a way to increase profit without raising the price on the actual item.
A common form of hidden fees and surcharges is “fine print” in advertising. Another way to hide fees that is commonly used is to not include “shipping fees” into the price of goods online. This makes an item look cheaper than it is once the shipping cost is added. Many hotels charge mandatory “resort fees” that are not typically included in the advertised base price of the room.
A common form of false advertising is the bait-and-switch tactic, this is when an advertisement says something specific about a certain product or the price of the product, but has no intention of selling it,or they would sell it for a much higher price then they said. The seller will try to take advantage of the customer when they respond to the advertisement by trying to sell them a product that is very different than what they were showing or at a much higher price.
Fillers and Oversized Packaging
Some products are sold with fillers, which increase the legal weight of the product with something that costs the producer very little compared to what the consumer thinks that he or she is buying. Food is an example of this, where meat is injected with broth or even brine (up to 15%), or TV dinners are filled with gravy or other sauce instead of meat. Malt and ham have been used as filler in peanut butter. There are also non-meat fillers which may look starchy in their makeup; they are high in carbohydrates and low in nutritional value. One example is known as a cereal binder and usually contains some combination of flours and oatmeal.
Some products may have a large container where most of the space is empty, leading the consumer to believe that the total amount of food is greater than it actually is.
Portraying honest quality and origin
Another form of deceptive advertising is when the advertisement portrays quality and the origin of the product falsely. If the advertisement shows a certain product with a certain quality but knows the product has defects or is not of the same quality, they are false advertising the product. A lot of times the producer will lie about where the product is manufactured, sometimes they will say it was produced in the United States, but it was actually produced in a different country.
Puffery in Advertising
The FTC has a long and storied history of pursuing some of the largest companies in America for false advertising, which must be “motivated by a desire to deceive or mislead the public.” False advertising is also subject to civil and criminal laws, punishable by anything from a public verbal slap to stiff penalties.
So whereas puffery often includes a value word that is a matter of opinion, a false ad contains a deliberate falsehood. And it happens more often and by more notable companies than you may think.
In everyday language, puffery refers to exaggerated or false praise. In law, puffery is a promotional statement or claim that expresses subjective rather than objective views, which no “reasonable person” would take literally. Puffery serves to “puff up” an exaggerated image of what is being described and is especially featured in testimonials.
Puff piece is an idiom for a journalistic form of puffery: an article or story of exaggerating praise that often ignores or downplays opposing viewpoints or evidence to the contrary.
Puff piece is an idiom for a journalistic form of puffery: an article or story of exaggerating praise that often ignores or downplays opposing viewpoints or evidence to the contrary. In some cases, reviews of films, albums, or products (e.g., a new car or television set) may be considered to be “puff pieces”, due to the actual or perceived bias of the reviewer: a review of a product, film, or event that is written by a sympathetic reviewer or by an individual who has a connection to the product or event in question, either in terms of an employment relationship or other links. For example, a major media conglomerate that owns both print media and record companies may instruct an employee in one of its newspapers to do a review of an album which is being released by the conglomerate’s record company.
Although some journalists may assert their professional independence and integrity, and insist on producing an unbiased review, in other cases a writer may succumb to the pressure and pen a biased “puff piece” which praises the product or event while omitting any discussion of any shortcomings. In some cases, “puff pieces” purport to provide a review of the product or event, but instead merely provide peacock words (“an amazing recording”); weasel words (“probably one of the most important albums of the 2000s”; “Perhaps one of the leading bands of the 2010s”) and tabloid-style filler which is peripheral or irrelevant to assessing the qualities of the product or event (“during the filming, there were rumours that romantic sparks flew between the two co-leads, who were often seen talking together on the set”).
Fraud in Advertising
Ad fraud (also referred to as Invalid Traffic) is concerned with theory and practice of fraudulently representing online advertisement impressions, clicks, conversion or data events in order to generate revenue. While ad fraud is more generally associated with banner ads, video ads and in-app ads, click fraud has been associated with search marketing, mobile advertising and conversion fraud with affiliate marketing.
Type of Fraud
- Impression fraud
- Click fraud
- Conversion fraud
- Data fraud
Questionable B2B practices