What Is False Advertising and What Can Be Done About It?

what is false advertising misleading ads inaccurate marketing commercial lies

Did you know that every day you see around 5,000 advertisements

Such varied instances of being sold to leave you vulnerable to unscrupulous advertisers looking to make a quick buck. Unless you protect yourself from advertiser deception, you may lose a lot of money or even inadvertently risk your life.

Keep reading to find out what false advertising is, how it occurs, and how you can protect yourself from such fraud. 

What’s False Advertising?

A false ad is where a business or individual broadcasts, publishes or distributes an advertisement containing misleading, deceptive, or untrue representations of a product or service to customers. 

Advertising, as we know it, came into existence in the early 1900s. Shortly after inception, fraudulent advertising was banned in 44 states at the time. On the heels of this ban, states enacted various statutes to deal with particular types of fraudulent ads that have evolved to today’s laws on fraudulent ads. 

Types of False Ads

The ultimate goal of fraudulent ads is to get customers to pay for services or products they would never otherwise have considered. To better understand how false advertising works, you need to look at the various forms of fraudulent ads and how they’re meant to fleece customers.

1. Hidden Fees

Advertisers can push publicity for a product at one price. When you try to buy the product at that price, you’ll end up paying more for hidden charges like shipping, additional fees, etc. 

2. Bait-And-Switch

A bait-and-switch happens when a firm advertises a product with certain features and a specific price point only to make it unavailable while selling you a more expensive one.

3. Misleading Labels

Mislabeling is a popular form of fraudulent advertising, and it happens when a business sells a product by using false or misleading information. 

For example, an advertisement will use photos that aren’t of the actual product or make false claims. Other businesses will go as far as falsifying labels on products to mislead consumers on their true nature. 

4. Deceptive Comparisons

Crafty advertisers know that if they compare their products to the competition and come out on top, it’ll give them traction. However, what deceptive comparisons do is pit a business’ products in areas that beat the competitors’ features, without disclosing the other features for an accurate comparison. 

Advertisers pulling such fraud won’t place the comparison in the right context. Additionally, such ads will feature vague descriptors such as ‘better’ or ‘stronger.’ 

5. Descriptive Warranty or Guarantee

If a business offers a guarantee or warranty, without giving a specific remedy, and declines giving its customers a relief, it’s engaging in fraudulent advertising. 

How Can You Protect Yourself From Fraudulent Advertising as a Consumer? 

With the variety of ads you see every day, it’s easy to fall prey to fraudulent advertising. So how do you protect yourself?

1. If Looks to Good to Be True, Avoid It

Fraudulent ads prey on the desire for many people to get something at a bargain. As the timeless adage goes, if it’s too good to be true, then think twice. Ads that seem out-of-this-world should raise a red flag with you.

Such ads traditionally present you with one aspect of the proposition (that’s eye-catching) while omitting the catch. Dig deeper and ask questions when you come across ads that seem too good to be true. The real offer will be in the fine print. 

2. Do the Description and Pictures Match the Product? 

A landmark way to discern fraudulent advertising is when the description and pictures don’t sync with the actual product. At times, crafty advertisers will make the outward appearance match the description but twist the knife in the specifications or fine print. 

Anytime there is a variance between what an advertiser says they’re selling and what they actually deliver, there’s deception. The issue is this: If the advertiser can lie at the first interaction with you, what more do you think they are hiding? 

Make it a rule of thumb to steer clear products that vary in any way from their descriptions and pictures. 

3. The Business Won’t Answer Your Questions

A genuine advertiser who sells a faulty product will be quick to resolve the situation. As part of the resolution, such a business will try it’s best to answer your questions and ally your fears. 

On the other hand, when you find a business that refuses or deflects your queries concerning a product they’ve advertised, it should be a red flag. As a consumer, it’s your right to ask and receive information about the product in question. 

4. Watch Out for ‘Free’ Ads

Many advertisers nowadays use the buy one get one free model to drive sales up. However, some advertisements move to an extreme offering ‘free’ deals that don’t add up. 

For example, it’s common to see an electronic company use online ads to sell free products. When you dig deeper, you find that while the company doesn’t charge you for buying the product, they charge hefty shipping and other hidden fees. 

An ad touting a ‘free’ product almost always gets you to spend more in other hidden ways. Other fraudulent advertisers will use such ads to distract you from pernicious catches you’d never had willingly opted for. 

5. Be Wary of Pricing Discrepancies

Pricing is one area where consumers have high visibility into whether a deal is legitimate or not. When purchasing, take some time to shop around. You’ll soon realize any existing significant price discrepancies. 

Some businesses will lead with a highly discounted offer price, only to charge you more when you decide to buy. Such sudden shifts in price should make you close your wallet. 

Have You Fallen Victim to False Ads?

In the high stakes world of selling products and services, everything goes. Unscrupulous businesses look for ways to move more product through false advertising that costs you financially and places your life at risk. Train yourself to spot fraudulent ads to protect your wallet and well-being better.

Advertising moves your products, and when you get it wrong, it can hurt your brand for a long time. Every entrepreneur must face these and more challenges when trying to build a business, and our site helps equip business owners for success.

Check out more of our content for lessons, tips and ideas that can sharpen your business skills. Visit the Marketing section of the Everything Entrepreneur Blog to learn more about avoiding false advertising and how to market correctly.