Friday, February 11, 2011

A Need For Honest Online Advertising

One hundred years ago, false advertising flourished unbound by regulation or enforcement.  Dishonest advertising was so prevalent that consumers began to distrust all advertising, which threatened the existence of advertising agencies.  In response spurred by self-preservation, advertisers banded together in an effort to regain the public’s confidence by squelching false and misleading advertising. These ad men eventually formed Vigilance Committees to persuade firms to modify advertising toward honesty and transparency.  Vigilance Committees eventually became Better Business Bureaus.

At the dawn of the 21st century, we find ourselves in a similar situation because of an abundance of false and misleading advertising on the web. One only needs to look at the ads cascading down the side of Facebook pages to see falsely advertised claims despite their relatively stringent advertising standards.  Google, as well, can’t make a dent in the scams that slip through their quality control department’s filter.   The advertisements displayed in the middle of Huffington Post articles are universally misleading and appear not have gone through any veracity test whatsoever. Too many internet advertising firms shamelessly manipulate facts, massage truths and boldly lie to get more clicks.

According to a 2009 Neilsen survey, consumers value advertising’s ability to further inform them about purchases (5).  Around sixty percent generally trust television, newspaper and magazine ads. Yet only 33% somewhat/completely trust online banner ads (2).  Unscrupulous businesses are contributing to the destruction of the fastest growing advertising market’s reputation.

Facebook makes up 1/4 of U.S. internet traffic.  The company that pays the third most for ads on the site is a scam and they are far from the only business looking to mislead Facebook users. Scam sites spend hundreds of millions on duplicitous Facebook advertising and now that Facebook is poised to double its advertising revenue, scams will get unprecedented exposure to the younger and more inexperienced online shoppers. According to the Nielsen survey consumers under the age of twenty are more trusting of almost every form of advertising (8). To raise awareness of online scams,  a strong group of online communities and organizations, such as the BBB, Scam.com, 800notes.com, and Factoids.com, publish tips and combat scams. These efforts are largely successful in keeping most people outside the clutches of dishonest businesses, but it does not prevent financial losses to honest businesses that advertise in an equally-sized space displayed in the same area of web-pages as scams.  Internet users have trained themselves to overlook those ads. Ads become 'invisible' to the eye as the main page content dominates the user's attention.  Just as it was during the Truth in Advertising movement, most ads are being ignored because of the unscrupulous marketers who care nothing for honest advertisers.

All regulatory advertising laws apply to the web, but if online businesses choose to remain anonymous, they are notoriously hard to locate.  Government agencies are also reluctant to put the sword to internet advertising because it could be confused as an attempt to censor online content, a highly unpopular sentiment in the United States.  The FTC and Department of Justice (IC3) typically pursue more overt internet financial crimes such as wire and check fraud.  This leaves a regulatory black hole for scammers to exploit.

Free market consumerism can do nothing to minimalize the prolificacy of scams. Nor can it shield honest business from undue discrimination for the type of advertising in which they engage.  Consumers tend to lump all banner ads in the same distrustful category.  The general public does not possess the expertise to discriminate between the honest and dishonest advertising. They simply cannot dedicate their time to learning the intricacies of deceptive advertising while at the same time keeping up with their own careers, second jobs, tending to family obligations and pursuing hobbies or dreams.  Passivity is obviously not a remedy and we cannot rely solely on the government to fight dishonest online advertising.
 

Dishonest advertising negatively affects everyone in the legitimate business world.  The only defenses of dishonest advertising are predictably inadequate. They either involve strong denial in the face of evidence or the immature gradeschool mantra “everyone else is doing it.”  In false advertising cases brought to court, federal judges are unimpressed by both defenses
(Brown & Williamson Tobacco v. FTC; Encyclopedia Britannica, Inc. v. FTC).

Rampant online dishonesty causes legitimate advertising agencies to face an uphill public relations battle and, if left unimpeded, guilt by association could possibly extinguish them altogether.  It can and does cause consumers to lump accurate ads, from businesses who want nothing more than to show off their products, into a distrusted category. Websites that publish dishonest ads are harming their reputations and will eventually render their advertising programs useless once consumers forever cease to click on banner ads.

Advertising agencies, honest businesses, consumers, government agencies and nonprofits like the BBB need to actively refute claims of dishonest online advertising. Consumers can challenge businesses to substantiate their outlandish claims and publish the results on blogs. Advertising agencies, who are most adept at identifying misleading copy, can inform the BBB or the National Advertising Division of these dishonest practices. We investigate advertising issues and ask companies to modify misleading ads.  If our findings unveil issues that the business is unwilling to remedy, we will not only report it to the public, we will present a complete case to the proper consumer protection authorities. We frequently work with Attorneys General offices, the Federal Trade Commission and Action News to protect consumers from unethical advertising.  Pressure from all sides on these unscrupulous advertisers is an integral step in creating a safer, fairer online business environment. Join the BBB in the fight against deceptive online advertising.


7 comments:

  1. I agree and I share in principle with the Internet Engineering Team about a World Wide Web police that has the authority to shutdown at once web scammers and their pages. Maybe in Internet Protocol version 6, such an entity and authority could exist.

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    1. I agree with this person. It's hard to trust some WEB businesses that obviously setup their websites to deceive and trick users.

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  2. One area we hope to see more balance is on review sites. These sites are hugely influential, but consumers can post almost anything anonymously. Further, the reviews are not weighted. Review sites should acknowledge that unhappy customers have a very high chance of posting a negative review, while the vast majority of happy customers almost never post reviews. Anyway, great article Aaron - we are new members of the KC BBB and are encouraged to see all the online content and focus.

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  3. KC Web Design, I completely agree. Customer review sites can be useful if you know how to recognize shills, angry ex-employees, and rash/unreasonable customers. Review sites are also absolutely useless for scams. The truthful posts are outnumbered by the incredible volume of glowing reviews written by the scammers themselves.

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  4. "These ad men eventually formed Vigilance Committees to persuade firms to modify advertising toward honesty and transparency. Vigilance Committees eventually became Better Business Bureaus."
    Where did you get that history, Aaron?

    `~- Nehmo

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  5. Nehmo,

    We have historical archives dating back to 1916. If you are wishing to corroborate the info, you can check out other BBBs and old Printer's Ink magazines through Google Books. There's some information on the Kansas City Vigilance Committee and the Kansas City Advertiser's Protective Bureau, our forerunners.

    Here's a bit about the beginning of the KC BBB: http://kansascity.bbb.org/NewsStory.asp?sid=100817EarlyHistBbb

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