Deceptive advertising: its characteristics, impact, and regulations

Deceptive advertising is a practice that distorts the reality of a product or service with the aim of influencing consumer decisions. In this article, we'll analyze its characteristics, its main forms, some representative cases, and the legal framework that regulates its use.

Characteristics of misleading advertising

Deceptive advertising is defined by the Inclusion of inaccurate, ambiguous or exaggerated information that may mislead consumerss. Its objective is to influence the purchasing decision through strategies that hide or manipulate certain aspects of a product or service.

Some of its main features are:

• Falsehood or distortion of information: Makes incorrect or inaccurate claims about the product, its benefits, or how it works.
• Omission of relevant data: Excludes essential information that could influence the purchasing decision, such as additional costs or terms of use.
• Exaggeration of benefits: It attributes qualities that have not been verified or that do not correspond to the reality of the product or service.
• Misleading comparisons: It establishes relationships with other products on the market in an inaccurate or biased manner.
• Misuse of legal or scientific terms: Use technical language or unsupported certifications to build consumer confidence.
• Visual or graphic manipulation: Uses retouched images or effects that present a different appearance than the real one.

Difference between misleading advertising and illicit advertising

Although they are often confused, Misleading advertising and illicit advertising are not exactly the same thingAll misleading advertising is illegal, but not all illegal advertising is necessarily misleading.

Deceptive advertising focuses on the distortion of information to mislead the consumer, whether through false information, significant omissions, or exaggerations. Its purpose is to influence the purchasing decision, even when the product or service may legitimately exist on the market.

On the other hand, illicit advertising covers a broader spectrum of practices that violate legal regulationsThis includes not only misleading advertising, but also advertising that violates ethical principles, incites discrimination, or promotes prohibited activities.

Types of misleading advertising

Deceptive advertising can take different forms, depending on how information is manipulated and the impact it has on consumersSome strategies rely on exaggerations, while others hide key details or use inaccurate comparisons.

The 6 main types of misleading advertising are found:

• False advertising: Contains outright incorrect statements about a product or service, such as nonexistent benefits or certifications it doesn't possess.
• Advertising by omission: It excludes relevant information that could affect the consumer's decision, such as additional costs, usage restrictions, or side effects.
• Hype: It attributes unrealistic properties or results that cannot be verified, generating unrealistic expectations.
• Covert advertising: Presents advertising content disguised as neutral information, such as fake reviews or paid testimonials without explicit notice.
• Misleading comparative advertising: It makes biased comparisons with other products, using inaccurate or manipulated data to highlight supposed advantages.
• Advertising based on false or unverified evidence: He uses studies, statistics, or scientific evidence without any real basis to give greater credibility to his claims.

Impact of misleading advertising on consumers and businesses

Misleading advertising not only affects those who purchase products under false information.While consumers may suffer financial harm or a loss of trust in brands, companies may face legal penalties and damage to their reputations.

Some main consequences of misleading advertising are:

• Loss of consumer confidence: Exposure to false or misleading information can lead to distrust of brands and affect future purchasing decisions.
• Economic damages for consumers: Purchasing products that don't live up to expectations can lead to unnecessary expense or even health and safety risks.
• Competitive disadvantage for legitimate companies: Companies that follow ethical practices may be affected by unfair competition from those that employ misleading advertising.
• Legal and regulatory sanctions: Depending on current legislation, responsible companies may face fines, lawsuits, or a ban on marketing certain products.
• Impact on brand image: A company that resorts to deceptive practices can suffer a reputational crisis that affects its credibility and its relationship with customers.

Examples of misleading advertising

Over time, numerous brands have turned to misleading advertising strategies, either by exaggerating the benefits of their products or presenting information in an ambiguous manner.

Some common examples of misleading advertising include:

• Foods with exaggerated properties: Products promoted as “100% natural” or with health benefits without scientific evidence to support them, misleading people about their true impact on nutrition.
• Confusing offers and discounts: Promotions that advertise reduced prices but, in practice, include hidden costs, pre-discount increases, or conditions that limit access.
• Cosmetic products with unreal results: Ads that show digitally retouched images to suggest immediate effects or dramatic improvements that cannot be achieved with the use of the product.
• Misleading labels on “light” or “sugar-free” products: Using terms that suggest nutritional benefits without clarifying that they may contain other unhealthy ingredients, such as artificial sweeteners or hidden fats.
• Advertising for opaque financial services: Loans and credit cards that omit key information about interest rates, fees, or clauses that can generate unexpected costs.
• Fast food cases: Images of hamburgers or pizzas that appear large and contain fresh ingredients in advertisements, but in reality are smaller and less attractive.
  
• Apps and Subscriptions: Services that are advertised as free but then include hidden fees or automatic renewals without clear notice.

Regulations on misleading advertising in Spain and Europe

Both in Spain and in the European Union, there are regulations to prevent misleading advertising from distorting competition and harming consumersThese regulations prohibit the dissemination of false or misleading information and establish penalties for those who violate them.

In Spain, the General Advertising Law and the Unfair Competition Law regulate these practices, while the CNMC supervises compliance and applies sanctions.

In the European Union, directives such as the Unfair Commercial Practices and Misleading Advertising directives seek to ensure transparent advertising campaigns in all member countries.

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