Resources

Avoiding the risks associated with ambiguous marketing claims

published in McAfee & Taft tIPsheet | December 2, 2015

Made in the USA

By Jessica John Bowman

Your business likely has a designated team responsible for developing memorable and informative marketing materials. But does that team include someone who can objectively review your materials to identify the risks associated with your marketing campaign? If not, it’s time to add some new players to your team.

Numerous businesses incorporate seemingly innocuous, commonly used claims, such as “all natural” and “made in the USA,” in their marketing campaigns. But claims such as these have come under fire in recent years, and many companies who make these and other representations have been forced to defend themselves against allegations of false advertising.

False-advertising claims are most often the result of a disagreement over the meaning of an ambiguous term. For example, a company that does not use artificial flavors or colorings in its product might consider its product to be “all natural,” but a consumer might disagree if the product includes genetically modified ingredients. Likewise, a company that assembles its product in the United States might mistakenly believe its product to be “made” in the United States, but the consumer (and the Federal Trade Commission) will likely disagree if the product is made using foreign parts. When companies and consumers disagree over the meaning of a term, the result is consumer confusion and, in some cases, litigation.

Some companies have managed to successfully defend their use of these and other disputed claims in their marketing campaigns. But even if you can successfully defend yourself against allegations of false advertising, the cost of defending against a false-advertising claim ordinarily outweighs any benefit resulting from the use of ambiguous or commonly misused marketing terms. The best way to limit your risk of becoming the target of a false-advertising lawsuit is to perform a risk analysis before greenlighting a new marketing campaign. Review both your product and the claims you make regarding your product – whether those claims are made on the product packaging, in your advertisements, or on your website and/or social media platforms – to determine which claims, if any, could be misconstrued by consumers. In most cases, any ambiguities can be cleared up quickly and inexpensively by either removing the ambiguous claim or by providing additional information.