By Vincent Xie and Heidi Moesinger.
We as consumers often watch or receive ads that promote things we care about. Like it or not, the first question a rational consumer has to ask is how truthful an ad is. Some argue that regulators such as the Federal Trade Commission (FTC) have drawn a clear line on what is deceptive or not for advertisers. Over the years, the FTC has filed many lawsuits against a number of big name brands. The risk for companies running false or misleading ads is too high to afford. So most of time, we as consumers don’t have to worry about advertising deception. Do we?
Indeed, however, it probably won’t be very difficult for us to find plenty of ads or product labels that are not entirely true. The stringent regulations don’t seem to work well all the time. The starting point to understand this phenomenon is to ask whether those “big brothers” working at places such as the FTC see ads differently than we as consumers do. We don’t have to be rocket scientists to google keywords such as “FTC deceptive advertising.” Chances are we can easily find that the FTC does provide a clear definition of deceptive ads: “…a representation, omission, or practice that is likely to mislead the consumer acting reasonably in the circumstances, to the consumer’s detriment” (FTC 1983). Yes, 1983. It is the one still used today.
We can look at this definition from many different angels. One perspective is that an ad has to do some harm to be characterized as deceptive. Intuitively, it makes a lot of sense. When we buy a burger, we probably won’t be bothered by the perfect burger pictures on the menu or display ads. Advertising is advertising. No one should present a bad image of a product in an ad unless the advertiser has ulterior motives beyond selling the product. As long as no harm is made, we should have no problems with this kind of ad. No harm, no foul. Right?
A recent study published in the Journal of Business Ethics examined this issue empirically from a consumer’s standpoint (“Disentangling the Effects of Perceived Deception and Anticipated Harm on Consumer Responses to Deceptive Advertising”).The researchers at the University of Massachusetts Boston and University of Oregon conducted a survey and two experiments among a total of 427 adult consumers. They chose weight loss ads as the experimental stimuli because the pretest showed this as a product category that many consumers could easily understand in terms of ad deception as well as the harm caused by the potential deception. In one experiment, participants read a weight loss ad, and then reported their attitudes and purchase intentions. The trick was, the research design primed participants to believe the ad was “very misleading and very harmful,” “very misleading but a little harmful,” “a little misleading and very harmful,” or “a little misleading and a little harmful.” In the second experiment, they basically replicated the design by sorting participants into the same four conditions, but with a different ad and a modified procedure. Participants were guided to believe that the ad was more or less deceptive, and at the same, more or less harmful.
The results suggest that deception and harm are essentially two independent judgments in consumers’ minds when it comes to advertising. In this study, participants reacted to a potentially misleading ad quite negatively regardless of the degree of harm. In other words, just thinking a little bit about deception exerted a strong enough effect to turn participants away from the advertised product, even when the anticipated harm of deception was minimal. They did not take harmfulness into consideration that much when evaluating a potentially misleading ad. This finding is consistent with recent works on the “stopping power” of consumer suspicion. That is, awareness of potential deception keeps consumers from comprehending the ad content or its source further. As long as consumers believe the ad could be deceptive, a defensive mind sets in and they would rather not think about the ad anymore.
Intuitively enough? This research has more to offer. The findings also reveal that anticipated harm did have a hidden effect on consumer responses, which the researchers labeled the “mediation effect of diagnosticity.” That is, a greater harmfulness could have increased the psychological importance of deception when consumers think about an ad. This process partially accounted for the overall negative reactions to the deceptive ad. In the article, the researchers argued that, “…some latitude of tolerable consequences may exist around which the level of consumer cognitive elaboration about deception is low. Consumers may ignore some cues about potential deception in ads if a harmful consequence is not obvious. Potential deception is simply less important at lower levels of harm, but this may change when expected harm increases.”
Simply put, this empirical study suggests that consumers don’t necessarily consider harm a defining character of a deceptive advertisement. The effect of harm on consumer judgment of deception can be additive. Should the FTC think like a consumer? The fact is NO. The FTC definition of ad deception has been well and alive for over 30 years. Should the FTC consider consumer insight and update the definition? Well, that’s the real question. What do you think?
Vincent Xie is an Assistant Professor of Marketing at the College of Management, University of Massachusetts Boston. Heidi Moesinger is an MBA student at the College of Management, University of Massachusetts Boston.