Ever seen sales signs with claims such as “risk free”, “Australian made” or “closing down sale”? There are numerous words, phrases and sales techniques commonly used in advertising that can be legitimately used but it’s worth remembering that care does need to be taken.
The Australian Consumer Law (ACL) recently replaced the Trade Practices Act to give consumers the same rights in any part of Australia. Some parts of the updated rules are obvious, such as use of the words ‘closing down sale’ – it is clearly misleading to have a closing down sale that lasts for three years. But there are others that are worth keeping in mind when deciding on your advertising campaign.
Bait advertising is when customers are lured into a store because of a great offer, but when they get to the store the item is sold out and they are urged to buy something else. Discounts can be an excellent way to attract customers but it’s important that they have a ‘reasonable’ chance of actually buying the product on offer.
How many times have you seen claims that something is free? Whether it’s a ‘buy one get one free’ offer or percentage of the product free the ACL makes the point that businesses can find themselves in hot water if they don’t clearly point out limitations that will apply.
Have you ever tried to purchase a product or service such as a home loan, and been told that you cannot complete the transaction unless you buy another product, such as insurance? This is third line forcing and is illegal. Product bundling is different but care should be taken.
Before signing off any advertising messages, presentations, packaging or contracts I ask myself if there is any way it could be interpreted incorrectly and possibly mislead a consumer. Not only is misleading against the law but it can have an enormous impact on your credibility.
What are some of the rules you think businesses need to be more aware of?
