What is Comparative Advertising, and how does it work?

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Table of Contents

• Comparative Advertising
• Factors to Determine Unfair Comparisons
• Conclusion

Comparative advertising campaigns can become misleading or deceptive conduct if they fall under the Australian Consumer Law (ACL). Comparative advertising is where businesses compare their products more favourably than their competitors’ products. It is important to distinguish this from a mere puff. If a statement is capable of quantification, measurement or concrete evaluation, then it is more likely to be a representation and not a puff. If your business is being unfairly compared in a way that it is misleading or deceptive, our business lawyers can assist.

Comparative Advertising

Comparative advertising can assist consumers in making more informed decisions and improve their product/services as it enhances consumer welfare. There is nothing inherently suspicious about comparative advertising and there is certainly no presumption that the advertising is in breach of the ACL. However, if actual comparisons between your business’ products are used, care must be taken to avoid error and half-truths

Factors to Determine Unfair Comparisons

There are a number of key principles that are used to determine whether certain advertising is in breach of the Act. For your business, you need to consider these factors carefully to determine whether a claim may be valid. These factors include:

• An advertisement must be examined in its entirety, not just the meaning of isolated words in the advertisement;
• The impact of an advertisement on a viewer or reader is created on first impression and not after a lengthy analysis of the parts of the advertisements;
• Most viewers or readers do not make a close study of the constituent parts of an advertisement. Accordingly, a misleading representation formed on first impression will not be mitigated by a smaller and non-obvious part of the advertisement;
• Suppliers who engage in comparative advertising must take particular care to ensure the comparison made is correct;
• Inaccuracy, half-truth, ambiguity or omission made in the context of comparative advertising may have greater potential to mislead consumers than in other forms of advertising.

Conclusion

At LegalVision, our business lawyers can assist you with protecting your business’ interests. If you feel that another business is harming the image of your business, get in touch. Although intention is not a requirement for establishing a contravention of the Australian Consumer Law, where a person engaging in advertising or promotion intends to convey a particular impression designed to influence consumers in a particular way, this may more readily infer that the attempt succeeded and that consumers were so influenced. To understand your business’ rights and resolve a business dispute, call us today on 1300 544 755.