Manufacturers have strict regulations and oversight around how they market their products. This marketing “must be truthful, cannot be deceptive or unfair, and must be evidence-based,” according to the Federal Trade Commission (FTC). The FTC monitors how companies are marketing their products and the claims that they make about those products.
For example, there have been many companies who make health claims about their products, such as Airborne claiming to protect from colds and POM Wonderful claiming their juice could treat afflictions such as heart disease, prostate cancer and erectile dysfunction. In both cases, among many more, the claims made in marketing were struck down and had to be changed by the companies. These claims were deemed to be deceptive marketing.
Deceptive Marketing Defined
The FTC considers marketing deceptive if it misleads customers and affects customers’ decisions regarding the product or service offered. The FTC additionally aims to protect consumers from unfair acts or practices, which are those that cause substantial injuries with no reasonable outweighing benefit or prevention.
Sellers are allowed to make claims about their products, but they must be backed up with data. This is especially important for claims on health and safety, as deceptive marketing can and has caused injury.
In cases where someone is held criminally responsible for deceptively marketing a product, he or she may face a fine of up to $5,000 and six months of imprisonment on a first conviction; any further convictions double both the fine and jail time. Additionally, the FTC may impose fines of up to $43,280 per violation.
Common Types of Deceptive Marketing
One of the most commonly-seen types of deceptive marketing occurs when a seller makes grandiose health claims about a product. However, for a deceptive marketing claim to be successful, it must be established that the seller was knowingly misleading potential customers and made some effort to research the claims.
Another common deceptive marketing tactic is the bait-and-switch, in which something is advertised but upon point of sale, the deal is very different. A bait-and-switch can involve charging much more than the advertised offer or attempting to sell an inferior product in place of the advertised one. Many promotions include terms and conditions to advertise fairly and avoid being accused of attempting a bait-and-switch.
Sellers may also market their products as “Made in the USA.” For this to be true, according to the FTC, there should be “evidence that the product is all or virtually all made in the United States.” While parts of the product may come from foreign sources, they must be substantially transformed or assembled in the United States to be able to accurately market themselves as “Made in the USA.”
The FTC also discourages the use of “green” and “eco-friendly” terms as these are broad and hard to substantiate. To do so, marketers must show some specific environmental benefit their product or the process of manufacturing their product provides. Some companies will advertise themselves using environmental benefit claims by giving a specific amount of material that was recycled and repurposed; for instance, by printing on napkins that were made with 50% recycled content. Sellers can not claim their product is either compostable or degradable unless they have done the proper research on how the product will break down in either respective condition.
Warning Signs of Deceptive Marketing
Deceptive marketing usually involves claims that are “too good to be true.” If a product seems to be a cure-all or has grandiose claims attached, there is a good chance that this is deceptive marketing. Promotions of extremely cheap offers are also a red flag for either a scam to steal information or a way to trick customers into paying money for an inferior product.
Refunds or Remedies
If a company offers a return policy, taking advantage of that is an easy solution, especially if it is the case that the product is simply a defect and outlier. Retailers are required by the Uniform Commercial Code to accept returns if a sold good is defective.
However, sometimes a return on a defective good or one that does not hold up to its claims is not enough. If there is significant injury on the consumer, the seller may be liable to a civil suit. Bringing a lawsuit against deceptive marketers can result in reclaiming monetary damages as well as a court ordering the marketers from continuing to use deceptive language or promotions in the future. In major cases where a large company or manufacturer stands accused of deceptive marketing, a class action lawsuit may begin to encompass all defendants, such as the case with Volkswagen’s settlement when it was found their cars had less emissions than they claimed.
Consult Legal Representation
Deceptive marketing can range from a ploy to boost sales to knowingly selling very dangerous products to consumers. Contact the consumer protection law experts at Parnall & Adams Law today for more information or if you believe you have been injured by deceptive marketing.