What are the Regulatory Laws of Advertising? (+7 email rules)

Depending upon the size of the company you represent, if you handle marketing you have undoubtedly worked with lawyers.

Not because you have done something wrong, but because you are trying to sell something.

Let me explain.

You see, in order to sell something to a customer, you have to use compelling language.

It’s called sales copy.

And while we aren't here to teach how to write sales copy in this tutorial (which is the foundation for websites, radio, TV, social, print, etc), all marketing and advertising requires great communication skills designed to speak directly to the consumer.

And therein lies the hurdle.

You see, marketing language is far different from lawyer-speak.

Not just very different, but a great marketer and a lawyer are literally on different planets, as it relates to communicating with a customer.

You see, in today’s environment, lawyers representing a company have one goal: “don’t be a liability”.

The marketer has to make a sale.

So somewhere, the marketer and the lawyer have to meet somewhere in the murky middle.

That is, the marketer needs to be able to use compelling-enough language in their sales and advertising message in order to make sales (so there is enough cash flow to pay for the lawyer’s fees).

And the lawyer needs to ensure the language used does not break any advertising rules. And depending upon the industry, the list of regulations can be a long one.

For example, in the franchising business there have been a lot of unscrupulous sellers that have preyed upon buyers. So much that the FTC has devoted a lot of resources to providing heavy rules that govern the industry. It’s called the FTC Franchise Rule and a core result is the development of the Franchise Disclosure Document (FDD) which must be created by every seller. A similar result is true in a lot of industries, including banking, credit, insurance, healthcare, on and on.

So, with that… let’s go over a few basics of marketing, advertising and regulations.

The Role of Attorneys in Advertising 

Regulatory laws of advertising and marketing refer to all laws that cover

How you communicate to your target audience 

This includes everything such as print ads, emails, billboards, magazine ads, posters, radio, and television commercials. 

And for a good advertiser, each ad is designed with the aim of convincing people to purchase their products or services. 

Attorneys are there to provide a proper guideline that helps businesses stick to the advertising rules. 

For example, an aggressive marketer might write an ad that says:

Example Headline of a Big, Unsubstantiated Claim:

Now You Can Earn $10,000,000 in 30 Days Using
the New Money Making Machine

This headline might be believable to the seller, but unless it can be supported by facts, an attorney (and a more conservative marketer) will suggest something like:

Now You Can Be Your Own Boss with
the Ultimate Money Making Machine 

By doing so, lawyers encourage the companies they work for and advertising agencies to perform their tasks in line with the rules, hopefully always ethically, morally and legally.  

For example, an attorney working for a franchisor has different rules they need to adhere to than an attorney working for a food manufacturer who sells to retail outlets. 

A franchise seller can make a claim as to how much money a prospective buyer can make, as long as it is supported by facts.  

While both need to be honest, legal, moral and ethical at all times, the franchisor needs to be very careful in their customer-facing language versus a food manufacturer who sells to a sophisticated grocery chain.

One thing to note is that advertisement laws have an impact on different areas of business operations. These laws can determine how a business conducts email and telemarketing campaigns, how a company presents its products, and how a business can present claims through advertising attorneys. 

Why Are There Advertising Laws?

Advertising laws are in place to protect consumers. 

The laws require advertisers to be honest about their products and services. 

The same laws compel advertisers to clearly substantiate their claims. Therefore, every business should comply with both advertising and marketing laws. Failure to do so may result in costly lawsuits, not to mention civil penalties. 

Before you start your advertising and marketing campaigns, you need to understand basic rules. Some of these rules will guide you on how to market your business. Bear in mind that under the FTC (Federal Trade Commission) Act, advertising should be non-deceptive, truthful, provide evidence to back up its claims, and be fair to all people. 

Other laws apply to advertisements for specialized products and services such as credit, leases, adverts bearing a 900 telephone, and the number of products sold through telephone sales or mail order. 

Both the local and state governments regulate ads. However, the enforcement remains the task of your attorney general, a local district attorney, and consumer protection agencies.

Who regulates Online Advertising?

The Federal Trade Commission is responsible for regulating online advertisements. Its regulations apply to both advertising and marketing strategies on different mediums. The same regulations apply to claims directed to the products’ effectiveness. 

Some of the laws and regulations under the Federal Trade Commission cover the truth in advertising and unfair trade practices. These principle concepts regulate how businesses present the benefits their products and services offer the target customers and clients. 

Perfect examples of these principle concepts include:

  1. Violations of the trademark from another entity
  2. A false representation of the products’ environmental impact
  3. Prohibitions of unproven health claims.

Truth in online advertising is crucial to the Federal Trade Commission. 

When the FTC detects cases of fraud committed on consumers or end-users of a product, the agency goes ahead to file a case in federal district court. This legal situation comes in handy to prevent scams, keep away fraudsters, freeze scammers’ assets, and get compensation on behalf of victims.  

One industry in particular that is carefully watched by the FTC is protecting consumers from false advertising in health and fitness. Specifically, companies making claims that are fraudulent or misleading.  

The federal law takes such actions to ensure that every ad that appears online, on radio, television, or printed media is truthful, appropriate to the audience, and supported by scientific evidence. 

The Federal Trade Commission enforces the truth-in-advertising laws and regulations to all online ads no matter where they appear. The FTC goes the extra mile to look closely at ads claims that affect consumers' wellbeing. 

The CAN-SPAM Act

The SCAN SPAM Act is one of the many regulatory laws of advertising and marketing observed today. This act sets rules and regulations to control commercial messaging. It also grants email recipients the power to subscribe. 

Companies and businesses that take these regulations for granted are subjected to incredibly steep fines and several legal actions. By setting up some guidelines, this act aims at ensuring that businesses remain compliant throughout their email marketing strategies. 

The CAN-SPAM Email Requirements

There are up to seven CAN-SPAM email requirements. All these requirements are tailored toward making sure that businesses comply with the CAN-SPAM Act. So, understanding the basics of these regulations is important for all involved in online advertising services. 

Below is a simple breakdown of what this act means for an email marketing strategy:

1. Stop the use of misleading headers for the emails: Every email header must have the correct information for the recipient. Also, an email sent from a company should address the right business or person who initiated the conversation. Therefore, your opening remarks such as “To”, “From” or routing information must be accurate before you send the email.

2. The email’s subject line should match the content: The subject line of your choice should go hand in hand with your content. This is because the subject line is considered the accurate representation of what your recipient expects. 

3. Make it known that your message is an ad: It is essential to state the goal of your email. In this sense, make your recipient know that your message is nothing else but an ad. After all, most consumers are aware that the objective of your email is to generate traffic to your company’s storefront or website. 

4. All messages should have the business address: Most people overlook or simply forget to include their company’s address in their messages. Make sure to include your business'  physical postal address to help your recipients know where to find you. 

5. Allow your email recipients to unsubscribe: Ensure that every message you send to your recipients has the unsubscribe link just in case one of them wants to opt-out. Craft this information creatively and logically to make it legible and easy to recognize.

6. Be ready to unsubscribe those who want to opt out of your future emails: Every opt-out you offer should process the requests within 30 days after sending the message. On top of that, this opt-out request should be honored in a period not exceeding ten days. Be sure not to charge any fee, ask for additional information, or sell your recipients’ email addresses thereafter.

7. Beware of what is being said about your business: Lastly, monitor what is being said about your company/business by other people. This is important because your business is responsible for messages and actions that your marketing affiliates commit, especially when dealing with federal law compliance issues.

Final Thought

Laws regarding advertising and marketing are wide and fast-evolving. They involve managing business practices in a bid to protect the public from getting deceived or misled by unethical advertisements. 

Unfortunately, most people are not aware of the implications of not adhering to laws and regulations that govern advertisements.

Information contained in this tutorial is designed to help you be a better, more informed marketer. 

References

https://www.ftc.gov/tips-advice/business-center/

https://proxy.www.sba.gov/managing-business/

https://www.americanbar.org/groups/business

https://www.ftc.gov/tips-advice/business-center/guidance

https://www.upcounsel.com/advertising-laws-and-regulations

https://guides.loc.gov/marketing-industry/regulations-and-ethics

https://www.findlaw.com/smallbusiness/business-operations

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