NAD includes press releases in its false advertising claims

The National Advertising Division of the Council of Better Business Bureaus (NAD) recently singled out a press release as the sole vehicle for a claim it considered misleading.

In the news
The National Advertising Division of the Council of Better Business Bureaus (NAD) recently singled out a press release as the sole vehicle for a claim it considered misleading. The NAD, a watchdog group for the ad industry, reviews ads that are disseminated nationwide or on a broad regional level for accuracy.

In this case, it suggested PrintsMadeEasy, an online graphic design and printing company, halt claims it made in one press release about its competitors and clarify claims made in another.

PrintsMadeEasy claimed the releases didn't fall under the definition of 'national advertising' and that an outside PR firm wrote and distributed the releases. The NAD, however, determined it did fall under 'national advertising,' and called the press release "nothing short of a paid commercial message by the advertiser."

PrintsMadeEasy was not available for comment at press time.

Why does it matter?
Though the NAD faulted press releases for false claims in the past, those examples were part of larger ad efforts, says Linda Bean, NAD communications director. In this case, however, a press release was deemed the sole vehicle for the advertising.

"This is certainly a cautionary example," she says. "[Most] folks in the PR industry know very well the value of being truthful and accurate in their communications, since integrity is their currency. If people can't believe what a PR person says, then that PR person rapidly squanders his or her currency in the marketplace."

Michael Schiferl, SVP and director of media relations at Weber Shandwick, echoes those sentiments, adding that recuperating from reputation damage is tough. "One of the things PR does best is help you build credibility," he says. "If you're not transparent and not credible to begin with, it kind of overshadows that."

Five facts:
1 The NAD handles more than 150 advertising disputes each year, but only infrequently encounters issues regarding press releases that contain literal falsehoods.

2 The NAD says its compliance rate is more than 95%. If advertisers don't comply, it opens an investigation and might refer the case to the Federal Trade Commission.

3 The LA Times ran a front-page piece in 2005 based on a press release created as an April Fool's joke, which discussed the plight of Canadian gray wolves.

4 A 2007 Time Out Chicago release claimed Donald Trump bought a controlling interest in the title. Crain's Chicago Business was fooled and posted a story on its Web site.

5 The California Supreme Court ruled in 2002 that companies can be sued for false advertising made in PR efforts if the messages qualify as commercial speech.

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