Marketing scams that can affect your business


Fraud is big business these days, and the Australian Competition and Consumer Commission (ACCC) is investigating a number of cases of alleged marketing-related fraud.

Unethical marketing practices not only affect the business involved. They can have a negative impact on other businesses as well. Here are three fraudulent marketing activities that are under investigation.

Big businesses dominating the online space

The ACCC is investigating whether large corporations that dominate the online sphere, especially in concentrated markets, are impeding the online strategies of small businesses, and having a negative impact in a number of different industries.

Fake testimonials and reviews

The posting of fake reviews is an ongoing problem for many businesses. As well as posting falsely positive reviews about their own businesses, a number of disreputable businesses also create false negative reviews about their competitors.

As the majority of consumers research products and services online before purchasing, false negative reviews can have a serious impact on a business. It can be difficult to counteract the problem of fake negative reviews, although there are a number of organisations that are working on a way to detect both false positive and negative reviews.

Hopefully this will cease to be such a problem in the future.

Misleading advertising in technology

A number of technology and telecommunications companies, such as Google and TPG, have recently been in the media for misleading advertising campaigns.

The proceedings against TPG are continuing after the ACCC took them to court for an advertising campaign last year that stated they offered broadband internet plans for $29.95 per month, but didn’t mention the additional $30 a month of line rental that was required.

In another recent case, the ACCC won an appeal against search engine Google for misleading advertising in search engine results. The ACCC successfully argued that Google was not differentiating between advertising and genuine results. In addition, some of the adverts were deliberately misleading, and when the users clicked on them, they ended up at a page for a different business entirely.

Disreputable marketing practices are not going to disappear, but it is a good idea to be aware of them, in case you find that your business is being negatively affected. It can be tempting to engage in unethical marketing activities yourself in an attempt to compete, but this is never advisable. With organisations such as the ACCC targeting scams like the ones above, you can face fines and other penalties, and it’s not worth the risk.

It’s also not worth any resulting poor publicity, especially when building customer trust is key to any business.