Deceptive Advertising: Are DMers Guilty?

Is Blockbuster lying to us? Some people think so.

Blockbuster’s new ads promise, “The end of late fees.” But, of course, that’s impossible: If there is no penalty for returning a movie late, you could keep it forever.

The way it really works is this: There’s no late fee when you keep a movie a few extra days. But if you don’t return the movie within seven days, you are forced to buy it at the current retail price. Then, you still can return the movie you “purchased” within 30 days for “a restocking fee plus applicable taxes.” After that, you’ve bought the movie permanently and it’s yours.

Does that make “the end of late fees” a truthful or deceptive claim? In my opinion, the latter: They are lying to consumers, pure and simple.

“The end of late fees” is trumpeted in Blockbuster’s prime time TV spots. But the “fine print” of the deal appears in a little booklet you can get – at my local Blockbuster, anyway – only if you ask for it.

“It is deceptive at best,” marketing consultant Jim Logan wrote to me on my blog. “I have rented my last DVD/video from Blockbuster. What Blockbuster is doing is ruining their relationship with their customers. They have big banners in front of their stores that read ‘The End of Late Fees.’ To have any type of late fee now just establishes them as a company that doesn’t take their customers seriously. Any company that engages in deceptive advertising cannot be trusted. Common sense would suggest this practice will alienate a good number of their customers and have a negative [effect] on their revenue.”

What does all this have to do with direct marketing? It speaks to the issue of how far we can go in creating perceptions about our products and services versus describing them flat-out in literal, accurate, to-the-letter language.

A vice president at a major direct marketing publisher recently described DM promotions as “controlled hyperbole.” But the separation between hyperbole and fact is often gray, not black and white.

It’s true that Blockbuster technically did away with the “late fees” as it once had them. But one can argue that the difference between the old and new late policy is merely semantics.

How about when you tell the consumer in your mailing that he may try your product free for 30 days? Actually, in a hard-offer mailing, it isn’t free … because you have to send money. The average consumer doesn’t think of something as free when she has to mail you a check to get it.

What about soft offers? Many subscription promotions with a 30-day money-back guarantee promote the first issue, sent within 30 days, as a “free issue.” But that issue is free only if you do not become a subscriber. If you do subscribe, then you are paying for that issue – i.e., for a monthly publication. That first issue is one of a total of 12 you will get as part of your one-year subscription.

For those who pay and do not request a refund, there is no free issue. In that case, “free issue” is not wholly accurate. More correctly, we should say “risk-free issue” or “no-risk issue.” To make it a true free issue, you’d have to give them the first issue plus, if they subscribe, 12 more issues – a total of 13 issues for the price of 12.

Even formats can be deceptive. How about those mailings in which what appears to be a check shows through the envelope window?

Or those mailings that look like articles torn out of a magazine or newspaper with a yellow Post-it note attached that says, “Try this. -J.” … and you have no idea who J. is?

Or ads in the newspaper, or those sections in magazines, that look like articles, but are really paid ads?

Or those postcards and vouchers that look like they came from an official government agency?

We know that consumers are wary and skeptical of advertising. And we know that making our promotions look informational or official often can lift response. But how do you know when you’ve gone too far? Three important indicators to pay attention to: your own sense of ethics; the law; and consumer reaction.

The bottom line: If your gut tells you that your promotion is deceptive, it probably is. And you should probably fix it.

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