Advertising

The FTC weighs several factors, including FTC jurisdiction. Although, the FTC has jurisdiction over ads for most products and services, Congress has given other government agencies the authority to investigate advertising by airlines, banks, insurance companies, telephone and cable companies, and companies that sell securities and commodities.

With the geographic scope of the advertising campaign, the FTC concentrates on national advertising and refers local matters to state, county or city agencies. The extent to which, an ad represents a pattern of deception, rather than an individual dispute between a consumer and a business or a dispute between two competitors.

State or local consumer protection agencies or private groups such as the Better Business Bureau (BBB) often are in a better position to resolve disputes involving local businesses or local advertising. To get the address and phone number of your state attorney generals’ office, your local consumer agency, or the nearest BBB, check your telephone directory or the Consumer's Resource Handbook. The amount of injury, to consumers' health, safety, or wallets -- that could result if consumers rely on the deceptive claim. The FTC concentrates on cases that could affect consumers' health or safety (for example, deceptive health claims for foods or over-the-counter drugs) or cases that result in widespread economic injury.

Before a company runs an ad, it has to have a "reasonable basis" for the claims. A "reasonable basis" means objective evidence that supports the claim. The kind of evidence depends on the claim. At a minimum, an advertiser must have the level of evidence that it says that it has. For example, the statement "Two out of three doctors recommend ABC Pain Reliever" which should be supported by a reliable survey to that effect.

If the ad is not specific, the FTC looks at several factors to determine what level of proof is necessary; including what experts in the field think is needed to support the claim. In most cases, ads that make health or safety claims must be supported by "competent and reliable scientific evidence" -- tests, studies, or other scientific evidence that has been evaluated by people qualified to review it. In addition, any tests or studies must be conducted using methods those experts in the field accept as accurate.

The FTC looks at the ad from the point of view of the "reasonable consumer" -- the typical person looking at the ad. Rather than focusing on certain words, the FTC looks at the ad in context -- words, phrases, and pictures -- to determine what it conveys to consumers. The FTC looks at both "express" and "implied" claims. An express claim is literally made in the ad.

For example, "ABC Mouthwash prevents colds" is an express claim that the product will prevent colds. An implied claim is one made indirectly or by inference. "ABC Mouthwash kills the germs that cause colds" contains an implied claim that the product will prevent colds. Although the ad does not literally say that the product prevents colds, it would be reasonable for a consumer to conclude from the statement "kills the germs that cause colds" that the product will prevent colds.

Under the law, advertisers must have proof to back up express and implied claims that consumers would take from an ad. The FTC looks at what the ad does not say -- that is, if the failure to include information leaves consumers with a misimpression about the product. For example, if a company advertised a collection of books, it would be deceptive if the ad did not disclose that what consumers actually would receive were abridged versions of those books.

There are many forms of advertising options in the Internet. For example, there are a number of programs referred to as "Pay Per" programs. These programs include pay-per-click, pay-per-lead, and pay-per-sale. Pay-per-click programs will enable you to advertise to your target audience and only pay for results -- you pay a set amount for each visitor that is sent to your web site. The most popular pay-per-click program is the pay-per-click Search Engines.

Pay-per-lead programs will enable you to pay only for leads. These leads may be potential customers that fill out a registration form, enter a sweepstakes, or download a free product trial. Pay-per-sales programs are simply affiliate programs. Affiliates are paid a set commission for each qualifying sale.

In addition to the above Pay-Per programs, you can purchase pay-per-click banner ads. Several companies online will place your banner within their network and charge you a set fee for each click through.

Another popular advertising technique used on the Internet is pop-windows. Although the effectiveness of pop-windows has declined (due to software programs that prevent them from loading), pop-windows can still be an effective advertising tool.