Legal and Ethical Issues from Promotion

• Legal - relates to legislation or the law (consequences may be a lawsuit or fine)
• Ethical - not include; is frowned up (is not necessarily breaking the law)
• False and misleading advertising is illegal under Trade Practices Act 1974.
• Information must be accurate and truthful:

  • price claims
  • fine print and qualifications
  • comparative advertising
  • claims about the future
  • country/place of origin
  • premium or benefit claims
  • bait advertising
• Unethical Promotion Strategies:

  • Bait and Switch advertising - consumers are persuaded to buy more expensive products where there is little stock of what they want
  • Sale Price manipulation - where goods have a sale price higher than the regular price
  • High pressure (door-to-door) selling - where products are forcefully advertising to consumers by sellers
  • Special offers & prices - where consumers must purchase something to claim a "prize"