Advertising online is the new, efficient method for getting your business attention. Whether it’s for work or entertainment, people spend a massive amount of time on the internet. After all, phones, tablets, laptops and other gadgets all link to the web.
That’s one of the top reasons why advertising online has dominated the marketing world and become the most influential channel. Like other industries, advertising online carries its own set of governing rules and guidelines, and it’s easy to make mistakes. This article demonstrates the best paths, where they came from, and how you can increase market share with them.
Introduction to Advertising Rules
The role of advertising rules is to instruct businesses on what they can and can’t do and say. In many cases, they come from applicable state and federal laws. But usually, these rules focus on promoting truth and ensuring there are no deceptive practices or discriminative content in advertisements.
They aim to restrain unfair advertising approaches, demand truth about products and services from advertising parties, and affirm these business’ claims. The line between the business making unaffirmed claims violating the law and making unharmful boasts about its product is very fine but clear.
Federal and State Law and Enforcement
The Federal Trade Commission enforces advertising laws at the federal level. And then, on a smaller scale, every state has a consumer protection agency, which enforces the state’s advertising laws. Overall, the state attorney general and district attorney have power within their jurisdictions. So, they can prosecute businesses with advertisements conveying harmful influence.
The Federal Trade Commission reviews, develops, and enforces federal consumer protection laws. It is also within its power to litigate claims through its Division of Advertising Practices.
General Federal Trade Commission Advertising Rules
- The advertisement that the business would like to publish must be truthful and not deceptive in any way.
- All claims made by businesses in their advertisements must be backed up by real evidence.
- The advertisements must be fair. That means that the ads used must not cause substantial injury that consumers cannot reasonably avoid.
The Federal Trade Commission holds great power in enforcement. It will first try to work out the claims privately with advertisers who made them. But if the advertiser refuses to comply, the Federal Trade Commission can move to sue the company on behalf of harmed consumers. It then forces the advertiser to make and show new ads correcting false, deceptive, or unfair statements or implications demonstrated in previous ads.
The Lanham Act
Just like how the Federal Trade Commission enforces laws protecting consumers against false advertisements, the Lanham Act allows business competitors to sue advertisers for false advertising privately.
It principally concerns trademark law violations. But competitors can also file lawsuits for false advertisements. For a business to successfully sue under the act, they must first prove the following:
- Claims made by the advertiser about a product register as actually false.
- The advertisement did or could deceive a large number of the targeted population.
- The deceptive part of the ad was an important one.
- The product shown in the ad was sold across state lines.
- The competitor, the plaintiff, was probably going to be harmed by the deception.
It is important to know that while the Lanham Act protects consumers against trademark confusion and false claims in advertisements, only competitors can sue under the act.
The Truth Policy
The simplest rule in advertising is telling the truth. Simple exaggeration and boasting for a product are expected and mostly allowed in ads. But don’t use tricks with wording that might deceive buyers into thinking the product can do something it cannot.
Have Enough In Stock
When posting an ad about a product at a discount, ensure enough quantity of the product to reasonably meet consumer demands. If you only carry a limited amount of the product, clearly state it in the ad.
When making an advertisement design, ensure you aren’t violating any of the rules. And make sure not to push the ad too far, where it starts becoming deceitful. Additionally, consider incorporating QR codes into your design, which smartphones can scan. That way, you easily direct customers to your website or product page. Search for regulations concerning online advertisements in the area where the ad will run, and make sure to abide by them.
Article written by Luiza Yeranosyan
Last updated April 13, 2023