What’s unfair competition in advertising?

by | Aug 16, 2021 | Firm News |

Businesses often strive to attract customers with advertising that promises high-quality goods and services, a good deal or a combination thereof. The marketing copy can be an ongoing slogan, a single advertisement, a TV ad or a print ad. Regardless of the outlet, a business looking to build brand recognition needs to be careful before placing a new campaign. While puffery is legal, false advertising can lead to legal complications known as unfair competition.

Puffery is selling an idea

Puffery is typical in advertising, and it typically does not cause consumers to pause. It involves statements and exaggerations designed to attract customers but not deceive them. Common examples include:

  • The best shoe store in town
  • Better tasting than the rest
  • You won’t find better service
  • The best coffee in the world

These statements are judgment calls. They are somewhat vague and do not make specific promises.

 False advertising misleads the consumer

Misleading customers or making false statements is different than puffery because they deceive customers. It can involve using false data to support a claim:

  • It is “made in the USA” when it is not.
  • It is “FDA approved,” but it is not.
  • It is “safe for people of all ages” when it is not.
  • “Nine out ten coffee drinkers agree” when there was not a poll.
  • It is “all-natural” when it has chemicals added.

Many remember Red Bull energy drink’s 20 year-campaign of “Red Bull Gives You Wings,” or Activia claiming its yogurt had “special bacterial ingredients.” Still, both companies had to pay millions in class action settlements for false advertising.

Defending against false advertising

Businesses need to know the difference between puffery and false advertising. Failing to do so could lead to expensive false advertising lawsuits instead of marketing campaigns that bring in more customers.