BUSINESS ETHICS AND ADVERTISING

MISLEADING ADVERTISING

Definition
Misleading Advertising is a false, misleading or misguiding information capable of causing the average consumer to act in a way that they would not. Advertising can also be considered misleading if important information the average consumer needs to make an informed decision is omitted. Misleading advertising contain claims made directly to consumers by manufacturers, distributors, and retailers, as well as in advertisements, catalogs, websites, etc.
Misleading advertising also includes advertising that reveals only the good points of a product or service and hides the bad points, i.e., twists the truth. Phrases and images that back up promises within the same advert are another important point to avoid being misleading. When evaluating whether an advertisement is misleading, the impression made by all advertisements should be taken into account. Advertisements that give a misleading impression are misleading, even if the statements and claims are objectively correct.

EXAMPLES COMPANIES INVOLVED IN MISLEADING ADVERTISING

AIRBORNE FALSELY CLAIMED SUPPLEMENT WARDS OFF GERMS.
In the 1990s, Airborne Inc., makers of the herbal supplement Airborne approved the release of a misleading health advertisement about their dietary supplement. For years, Airborne’s entire marketing campaign was founded upon on the idea that it “warded off” germs and boosted your immune system. However, the brand hadn’t actually performed any studies to demonstrate that its products did any such thing and not a single shred of evidence to back up either claim.
Airborne entered the market claiming that its formula — a result of research by second-grade teacher Victoria Knight-McDowell — could ward off colds. Airborne later backed off, reworking its campaign to say the supplement “boosts your immune system.” This has been misleading consumers for 10 years.

At this point, the Center for Science in the Public Interest (CSPI), a non-profit advocacy group led by CSPI Senior nutritionist David Schardt, got involved and Airborne was sued for making false claims about the product’s abilities. It was later revealed that the company paid two people who weren’t doctors or scientists to carry out clinical trials and research on the drug.
The resulting class-action lawsuit led to Airborne settling out of court and paying more than $23 million to affected consumers and were instructed pay for advertisements in major publications instructing consumers on how to get their money refunded.
They made factual claims that couldn’t be backed up by science. This is misleading since it led consumers to buy the drug on the assumption that it’s proven to work.

NEW BALANCE FALSE WALKING SHOE ADS
The New Balance website stated its true-balance toning sneaker, “uses hidden balance board technology that encourages muscle activation in the glutes, quads, hamstrings and calves, which in turn burns calories.”

The lawsuit was filed on behalf of plaintiff Bistra Pashamova and others like her who say they have been misled or harmed by the sneakers. Plaintiffs are seeking class action certification and more than $5 million in compensation

Studies cited in the lawsuit say the sneakers, which cost roughly $100, do not necessarily boost health benefits and may even lead to injury.
The lawsuit filed calls New Balance’s marketing claims that the shoes increase muscle activation and calorie burn “false, misleading, and reasonably likely to deceive the public.”