False and misleading comparisons tend to exist where there is extreme competition. In advertising, the use of biased information is recognized and accepted by industry, regulators and consumers - but the legitimate exaggeration of claims to make one’s product or service look better than that of their competitor is illegal. I find the use of “puffery” fits well with this type of false advertising claims, and the “Battle for Best Pizza” serves as a great example.

Papa John's was confronted on the use of its slogan “Better Ingredients, Better Pizza” advertisements, charged with the use of false and misleading advertising through use of “puffery” against their nationally known competitor, Pizza Hut. The problem pinpointed denotation of exaggeration by degree of quality to which the truth or falsity cannot be determined. The claim (under section of the Lanham Act) argued that Papa John’s slogan and overall advertising campaign, conveyed a false statement of fact, through use of the adjective "Better" could be interpreted as false or misleading.

Want to know the outcome? Pizza Hut won the verdict at district court, but lost on appeal! Exaggerated statements and commendation can directly affect the competition!

Feeling hungry yet?

References:
Arens, W.F., Schaefer, D. H., & Weigold, M. (2009). Commercial Break. Essentials of Contemporary Advertising. (2nd ed.). Boston: McGraw-Hill Irwin. ISBN: 978-0-07-338097.
Ebert, L. (February 21). Intellectual property news affecting business and everyday life. IPBIZ. Retrieved on September 29th, 2010 from http://ipbiz.blogspot.com/2010/02/dominos-uses-puffery-against-papa-johns.html

When it comes to unfair and deceptive practices in advertising, making a deceptive claim via endorsement or implication about a product or service to appeal to potential customers is unlawful. False Testimonials; however, can still be found today (Arens, Schaefer, & Weigold, 2009). One of my teenage daughters recently became a victim to this specific type of deception through a print advertisement in a popular magazine for an all natural dietary supplement claiming to “boost metabolism”, thereby making fat burn more quickly. Acai berry weight loss products (AcaiPure) has been widely advertised over the past few years through print, internet, and televised mediums. This all-natural, exotic supplement, owned by Central Coast Nutraceuticals, has recently been found to lack proof for its weight loss claim and charged by the FTC with using “deceptive, unfair, and unlawful acts and practices to sell its acai berry weight loss products” (Weisbaum, 2010).

The product has been carrying false celebrity endorsements by pop culture celebrities Oprah Winfrey and Rachel Ray (Weisbaum, 2010). Statements from the latter television hosts reflect that they never endorsed or approved any acia berry product by name. Furthermore, neither agreed to the use of their names or images to be used to sell or market the product. This allegation of false endorsements has created more than a million victims and; because the product is “all – natural” with trusted celebrity endorsements, has targeted the younger generations (Weisbaum, 2010). In a nutshell, celebrity testimonials can increase awareness of products or services, serving as an effective tool to positively impact sales. False and unsubstantiated claims; however, have created long-term damage in regards to credibility and legal implications Arens, Schaefer, & Weigold, 2009).



Arens, W.F., Schaefer, D. H., & Weigold, M. (2009). Commercial Break. Essentials of Contemporary Advertising. (2nd ed.). Boston: McGraw-Hill Irwin. ISBN: 978-0-07-338097.

Weisbaum, H. (2010, September 9). Acai berry scam: You'll lose money, not weight. ConsumerMan, MSNBC Contributor. Retrieved on September 27th, 2010 from http://www.msnbc.msn.com/id/38958053/

Like a fish out of water...the ol' "bait & switch"!

The method of consumer deception referred to as the “bait and switch” describes fraudulent luring by advertising a product or service through price or other in-demand features that is not available or changes in the end (Arens, W.F., Schaefer, D. H., & Weigold, M. 2009). An example I located encompasses Chase National Bank’s promotional offer for a “lower than prime” balance transfer rate for customers currently holding high interest debt. The solicitation promised: “No tricks, no gimmicks…just savings”. Chase’s offer was pretty strait forward, an awesome low APR (annual interest rate) with a minimal percentage transfer fee until balances are paid off, as long as required payments were made “on time” (Weisbaum, H., 2009).

The bait and switch tactic occurred after signing, with the receipt of the first bill that reflected a monthly fee of $10 added to cardholder accounts. This $10 a month fee significantly raised the interest rate on these balance transfer accounts and caused over-the-credit limit default for many. Upon contacting the customer service department, the representatives offered to drop the monthly maintenance fee if customers agreed to a new and much higher APR (Weisbaum, H., 2009). As a close friend of one of the banks’ transfer credit card holder, this type of activity was viewed as not only illegal, but with the abusive overtones of strait-out blackmail! Since legal intervention, stories have evolved that Chase erased the “fine print” and replaced it with new terms that gouged customers and served advantageous for the company. New rules from the Federal Reserves’ Credit Cardholders Bill of Rights, prohibits credit card companies from changing terms regardless of reason. President Obama signed the legislation on May 22, 2009, making it part of the Truth in Lending Act (Weisbaum, H., 2009).

References:

Arens, W.F., Schaefer, D. H., & Weigold, M. (2009). Commercial Break. Essentials of Contemporary Advertising. (2nd ed.). Boston: McGraw-Hill Irwin. ISBN: 978-0-07-338097.

Weisbaum, H. (2009, May 6). Customers sue Chase for changing terms. Consumer Man, MSNBC Contributor. Retrieved on September 28th, 2010 from http://www.kval.com/news/consumertips/44418137.html