Is it illegal to redirect potential purchasers from one brand to another?
Advertisers on the internet have been known to seek to “capture” some of the high volume search traffic for well known brand names, and then “redirect” potential purchasers of those branded products to other comparable products – which are sold by competitors.
How legal is this practice?
Fair and unfair competition
It is in consumers’ interests to be able to accurately compare the properties of competing products. Such properties might include their effectiveness, and their price.
However, where consumers might be misled or confused as to:
- what product they are in fact being sold; or
- the properties being compared;
the advertiser may be doing something illegal.
Some possible examples:
- An affiliate posts a review of a well known branded product, and places a “read more here” button (or an “order online” button) near the review. The button leads instead to a competitor’s website, and the consumer is confused about which product is which.
- An affiliate posts a review of a product that states it was more effective than another well known brand. The affiliate has not in fact used both products.
- An affiliate posts a review of a product which states that it contains the same active ingredient as another well known brand, but can be bought more cheaply. The affiliate has not adequately checked that the ingredients of both products are substantially the same, and/or that the product is currently cheaper.
“Bait and switch” and “passing off”
“Bait and switch” is a sales technique which involves advertising one particularly attractive product to a consumer at a specified price, but then a consumer is not given the opportunity to purchase that product, and is instead offered a different product. Intentionally using this practice is prohibited by the Consumer Protection Regulations 2008 (Schedule 1 Para.6).
“Passing off” is a sales technique which involves promoting a product similar to a product made by another well known brand owner in such a manner as to mislead (expressly, or by implication) the consumer into believing that the promoted product is made by the same manufacturer, when it is not.
The well known brand owner may sue the advertiser for its potential losses on any redirected purchases, and/or loss of goodwill that could be caused. Passing off is also prohibited by the Consumer Protection Regulations 2008 (Schedule 1 Para.13, and s.5(3)).
Lastly, you should remember that misleading statements generally (whether express or implicit) about products, which might cause the average consumer to make a purchase they would not have otherwise done, are also prohibited by s.5 of the Consumer Protection Regulations 2008.
- Do not link from an article on one product to a page advertising a competing product, unless you have made it absolutely clear that the product mentioned in the article is different to the products available at the link(s). This might be achieved by adding a prominent title to the link(s) such as “other products which may be of interest”.
- Make sure you do not make any factual statements which you cannot verify. In particular, be aware of comparing products on their pricing and contents, as these may change over time. It is good practice to state the date on which you are making any comparisons.
What happens if I don’t comply?
Brand owners may sue you directly for their potential loss of sales, based on the traffic you have redirected to their competitors. Misled consumers may also seek damages from you.
In addition, failure to comply with Consumer Protection Regulations may result in regulatory intervention and prosecution, resulting in adverse publicity and loss of consumer confidence, as well as fines.
What should you do now?
Review your website with the above guidance in mind, and ensure that it is not in breach of the law.
Remember, YOU ARE RESPONSIBLE FOR THE CONTENT ON YOUR WEBSITE.
If you have questions you can speak directly to our compliance officer.
Do you believe that an affiliate is acting unethically?
Complete the Unethical Advertising Claims form and MoreNiche will investigate.