Consumers and businesses take misleading advertising seriously. Taking precautions can help avoid legal and business disputes. It can also help protect businesses during investigations from agencies such as the Federal Trade Commission involving online false advertising.
In this blog post, we will examine some types of misleading advertising
A bait-and-switch ad attracts customers with a specific offer and then changes the deal to a typically more costly transaction after they claim that offer. Businesses should avoid offers that can turn into a bait-and-switch situation.
Conditions to an offer must be clearly stated in the advertisement. Include a link to a webpage with additional information if there is insufficient space in the actual advertisement.
Obtain permission before using an endorsement from a celebrity, customer or organization. Using their likeness or their endorsement without their authorization can lead to a false advertising lawsuit and other legal problems.
Businesses must have sufficient product or individuals to meet the demand for products or services. Prepare to meet reasonably expected demand. Insufficient product or personnel can lead to a false advertising lawsuit.
Businesses may use the word “free” if they comply with certain guidelines. A product cannot be advertised as free if the costs of other products are increased. Businesses are permitted to claim that a customer can receive two items for a certain price or reduce the price of an item so that the second product is free.
Likewise, businesses offer large discounts when going out of business. But a business can advertise an out-of-business sale only if they are actually closing or moving to a new location. End-of-year sales do not qualify as an end-of-business promotion.
Terms like eco-friendly or green must be qualified if they are used in ads. According to the FTC, advertisers should describe their products as biodegradable or recyclable.