Internet Marketing Law - FTC and Advertising Rules


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Marketing and Advertising on the Internet is subject to the same laws as any other medium. Sometimes people do not follow those rules, and the FTC or State AG is involved.

Marketing is amongst the most critical aspects of any company. Good marketing begins with market research and pricing, but there are many aspects including advertising, packaging, labeling, distribution and customer satisfaction. An effective marketing plan and advertising campaign must be based on the Truth-in-Advertising laws because untruthful or unfair information that deceives the public will result in costly penalties.

The objective of advertising laws is always to protect consumers from putting their faith in false claims. Companies need to be truthful regarding their products and have the proof that substantiates their claims. If a business does not comply with these laws they're subject to costly suits and civil charges. The basic rules are enforced by the Federal Trade Commission (FTC) under the Federal Trade Commission Act.

Advertising must:

Not be deceitful or untruthful
Have evidence that backs up their claims
Be fair

Additionally, there are laws and regulations that apply to advertisement for mail order products or telephone sales in addition to financial products. The administration of these laws is done by a local district attorney, consumer protection agency or a state attorney general.

The FTC gives policy statements, detailed guidance, workshops and current notifications for advertising regulations.

For Internet marketing and marketing there are a completely new set of laws to protect consumers privacy and ensure truthful advertising online. Those consumer protection laws that apply to commercial activities in other media also apply to internet businesses. It is vital that the disclosure of data about the terms of a transaction be placed close to the claim.

Disclosures should:

Be inserted in close proximity to or on the same screen as the triggering claim
Use graphic cues to encourage consumers to scroll down to see the disclosure
Make hyperlinks that lead to disclosures that are obvious and properly labeled as well as using a absolutely consistent style

Product labeling is another area of marketing techniques law that requires oversight.

More than ever do businesses will need to seek the aid of lawyers when consumers try to take legal action against them for false advertising or misleading advertising. There are many governmental authorities which exist and attempt to support the consumer in such claims. In many cases, a business has no support system to fight off such claims or clearly present its side of the story. However, a lawyer may be the one source of support that does help a business fight off such claims.

In particular, small companies are often very susceptible to legal actions from consumers. The sad truth is that many small business owners do not have the funding to settle consumers in a sizeable class action suit or lawsuit dealing with false advertising claims. To protect against a case from even going to court, an attorney can be the savior in a situation. An FTC lawyer can work to effectively negotiate with a consumer or group of consumers so that you can stop a lawsuit from being pursued to a courtroom.

ABOUT THE AUTHOR: Aaron M. Kelly
Mr. Kelly combines his education with hands-on experience, which provides him with strong, up to date knowledge of the issues that face our increasingly online-driven world. In addition to his law firm, Mr. Kelly also owns an internet marketing/consulting firm as well as a lead generation company for lawyers. Mr. Kelly also manages hundreds of websites and frequently serves as the host for online forum discussions focused on Internet marketing.

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Disclaimer: While every effort has been made to ensure the accuracy of this publication, it is not intended to provide legal advice as individual situations will differ and should be discussed with an expert and/or lawyer. For specific technical or legal advice on the information provided and related topics, please contact the author.

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