Monday, June 13, 2005

When Marketers REALLY ARE Liars...

I had the opportunity to read a prerelease copy of Seth Godin's new book called All Marketers are Liars which is now in bookstores and it got me thinking ...

If All Marketers are Liars (and Seth's title is a bit "tongue-in-cheek") why aren't more of them being sued? Isn't it illegal to make outrageous claims that you can't back up? (Even if it makes for a good story)

These questions made me pull out my notes from something I learned at a recent marketing law seminar that dealt with with the difference between how the legal system deals with "Puffery" and "Truth in Advertising".

The marketing law seminar was presented by ThirdWay Marketing in Manhattan, NY USA and featured Nancy C. Dowling, former Sr. Counsel for P&G for 10 yrs. and in-house counsel for Sears.

Nancy suggested the following rules for [legal] advertising:

  • Ads must be truthful and honest (unless they are clearly "Puffery"- which will be defined later in this entry).
  • Ads must have evidence to back up the claims BEFORE it is published/broadcast.
  • Ads cannot be “unfair” or “denigrate another brand”.

She also emphazied that "substantiation of claims" is not only required but can also be expensive. Examples of substantiation include:

  • Double blind comparison test with at least 300 consumers
  • Geographically dispersed tests to account for regional brand / category variation / usage patterns.

The seminar went on to talk about other related legal topics such as the NAD, FTC and trademarks but the point I'm trying to make is this .... where does Seth address the legality issue? Especially when Marketers REALLY ARE LIARS!?!

The answer was also provided in that same law seminar and it is called "Puffery".

The American Marketing Association defines "puffery" as:

1. (advertising definition) An exaggerated advertising claim that would be generally recognized as such by potential customers.

2. (consumer behavior definition) An advertising term implying gross exaggeration but usually not considered deception because it is assumed not to be believable. Examples are the mile-high ice cream cone or the world's softest mattress.

3. (sales definition) The exaggerated statements made by a salesperson about the performance of a product or service.

I have to assume that Seth feels that every Marketer who read his book already knew the distinction between puffery and legal advertising claims, but if not, hopefully this entry will put Seth's ideas into a little better perspective.

Don't get me wrong. I'm a big fan of Seth's books and I wholeheartedly agree with the ideas in his new book (the importance of stories and living the story). In fact, I encourage everyone to read it, as long as you keep in mind that there is more to the story than just what you make up ... there are legal implications if you truly are a LIAR !

Write On !

Dave Wheeler

P.S. Here is a link to a 5 page preview / excerpt of Seth's book in case you want to check it out.,15114,1053410,00.html

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