Influences on Marketing Consumer Law Flashcards
What is the Purpose of the consumer Law
- Promote fair trading and competitions
- provide consumer protections in areas including product
Breaching the ACL
- apply these laws to all marketing strategies and processes
- Failure to do so may result in a breach of the Competition and Consumer Act 2010 and proceedings being instigated by the ACCC
- Maximum penalty for false or misleading and unconscionable conduct and breaches of product safety is 1.1 million for corporations and $220,00 for individuals
- business will have legal fees associated with the case and may receive negative media coverage
- Costly experience = both financially and in terms of reputation
- if in the growth stage of a business, it might lead to faluire
What are the examples of misleading statement under the provision of CCA
- Fine print and qualifications
- Country of Origin
- Bait advertising
- Premium or credence claims
- Special offers and free
Fine print and qualifications
Businesses can not rely on disclaimers or small print to excuse a message that is misleading
Country of Orgin
Accuracy in labeling is important, country of origin claims may be made in writing or implied by images such as maps and flags
Bait Advertising
Promotes a product at a special sales prices, when the business has very limited quantities available or no products at all. If using this tactic, a business must be upfront about the fact that he sale item is in short supply and state the very limited quantities
Premium or credence claims
May suggest a product is safer, offers a moral/social beneficial or a nutritional benefit
Special offers and free
Consumers generally associate free with an item being absolutely free, use of strategies such as buy one get one free or receive an extra 10 percent for free suggests a saving to the consumer that must be achievable. Special offers that are continuously available may also mislead consumers.
