Thursday, December 5, 2013

Fraud in Marketing – More Common Than You Think


By: Pouneh Aghababazadeh, Melody Hsia, Yalan (Mary) Luo,  &Tian (Jason) Tan

Marketing is an important and vital part of any successful company, business, or organization that wants to generate revenue. Any product that a company wants to market must go through a process that includes new product development, product enhancement, sales, distribution, and pricing. Though each step of the process is crucial, advertising and promotion are probably the most significant, since it is the only way in which a product may be broadcasted and shown to the public. With this option, however, many businesses may choose to alter their product advertisement in an effort to trick the consumer audience into purchasing their product. This kind of fraud and deception in the advertising world is unfortunately extremely common, with detrimental effects- to the business and the consumer.

Fake advertising can be found from small to large scale businesses, and even to educational institutions. Even from humble and community-driven business opportunities like the farmer’s markets, a recent article reported that farmers had been lying about where their produce was grown and if it was harvested with or without pesticides. One of the farmers tried selling broccoli that he had purchased from a wholesale producer and then claiming that he had grown it organically himself.  “Lampman asked Uriostegui to show him where he was growing broccoli, but all the farmer could show him was a patch of dry dirt” (nytimes.com). Many farmers may also claim that their produce was grown without pesticide methods, but when asked how, they had no viable response. These farmers attempted to tack on information about their products that they knew consumers would be attracted to.

Marketing scams may often include exaggerating or overly praising the ability of a product. One of the main drugstore Beauty businesses, Rimmel, was also recently filed with marketing fraud due to a decepting mascara ad.”According to the complaint ... the company’s ‘grow lash claim is false, misleading, and reasonably likely to deceive the public’” (lexology.com). These makeup advertisers also attempted the same thing the farmers did- attempting to convince consumers of a false misconception of their product.

Even education institutions like colleges and universities often falsely advertise accreditations and opportunities in an effort to lure students into attendance. Recruitment officers may give off a  “false sense of their future career prospects” and may even “cost taxpayers money when an inordinate number of such students default on their student loans” (myquitamlawsuit.com).

Fraud and deception are rampant in society today and are present in a variety of different scale operations. These advertising scams are detrimental to a company or establishment’s reputation and jeopardizes producer-consumer trust. Advertisement and promotion are key components in marketing as well as business as a whole- that place significant effects on revenue.

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