In this edition of the Deceptive Marketing Practices Digest, we look at three marketing issues that resonate with consumers of the online marketplace:
- the collection of consumer data in exchange for “free” online products and services;
- unsubstantiated weight loss claims; and
- the marketing practice of “drip pricing” in the car rental market.
Let’s begin with the numerous “free” digital products and services that access and collect various types of consumer data. Some of that data may be necessary for the functionality of the digital product or service. However, some businesses design products and services to collect consumer data for other purposes, such as using it to display targeted ads or selling it to third-parties. Consumers should not be misled about whether they are paying with their own data for these “free” products or services.
Our second topic takes a look at businesses that take advantage of many Canadians’ desire to lose some weight. Some of these businesses make unsubstantiated claims to consumers about the efficacy of their products or schemes. They use social media and e-mail campaigns to market weight loss products to large numbers of consumers, who discover that “quick-fix” promises are often empty.
Finally, we discuss the enforcement actions taken by the Bureau to stop drip pricing in the car rental industry. This is a marketing practice where businesses advertise attractive prices which are actually unattainable because they add non-optional fees during the purchasing process.
As marketing practices, online or otherwise, develop and evolve, the Bureau will continue to educate the public, and inform businesses about the rules and their responsibilities towards consumers. Businesses should know that if they choose to defy those rules, the Bureau will take action to protect consumers from misleading claims and to preserve the competitive potential of the digital marketplace.