Chapter 4 False Advertising

False Advertising

False Advertising

The use of misleading, incorrect, or deceptive statements in marketing to convince consumers to purchase a product or service.

Misleading Product Claims

Claiming a product can do something it cannot, such as a supplement saying it 'cures' an illness when it doesn't.

Bait-and-Switch

Advertising a product at a low price to attract customers, then pressuring them to buy a higher-priced item when the lower-priced item isn’t available.

Misrepresentation of Ingredients or Quality

Making claims about a product's composition or quality that are not true, such as claiming a product is 'all-natural' when it contains artificial ingredients.

False Comparisons

Making comparisons between products that are misleading or inaccurate.

Misleading Pricing

Advertising incorrect or inflated discounts to make a product appear as a better deal than it actually is.

Charm Pricing

A pricing strategy that leverages emotional connections to numbers, making prices like $10.99 feel cheaper than $11.

Price Skimming

A strategy where a firm charges the highest initial price customers are willing to pay and then lowers it over time.

Markdown

A reduction in price intended to stimulate sales, such as seasonal discounts.

False Discounts

A product marketed as on sale with a discount, but the 'original price' is inflated or never charged.

Hidden Fees

Mandatory fees that are not included in the advertised price and revealed at checkout.

Price Comparison Fraud

Misrepresentation of competitor prices to show a price advantage.

Shrinkflation

Keeping the price the same while reducing the quantity or quality without disclosure.

Overlapping Sales

Promotions that are extended constantly, making it seem like discounts are special.

Markup

The amount added to the cost of a product to determine its selling price.

Markdown

The reduction of the original selling price, used to stimulate sales.