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Consumer law regulates what your business can say to your customers about your products or services and how you sell them. It mandates a minimum standard for your products and prohibits any misleading or deceptive conduct. Therefore, you need to adjust your advertising strategy to ensure you do not mislead your customers. This article will review six tips to align your marketing and sales strategy with New Zealand consumer law.

1. Focus On the Overall Impression of Your Advertisements

Your everyday New Zealand shopper will not spend extended periods analysing the validity of your advertising or reading complex terms and conditions that protect you from liability. Instead, when they purchase a product, they rely on your advertising being truthful and transparent. The law protects this by prohibiting any misleading statements about your goods or services in your advertising.

Therefore, to not mislead your customers, you need to ensure the overall impression of your advertising is true and accurate. Be careful about your branding and advertisement wording so that customers fully understand what it is you are offering. Not only does this include what information you put into your advertisements, but also the information you leave out.

2. Do Not Rely On Fine Print

Leading from the previous point, you cannot rely on the fine print to make a generally misleading advertisement true. Therefore, do not make claims in your advertising or marketing that you cannot support, and then put a small disclaimer saying ‘terms and conditions apply’ as a way to cover your bases. This addition may not be enough to contradict the general thrust of a misleading advertisement.

For example, say that you offer a ‘lifetime guarantee’ of repairs or fixes for boots that you sell. However, you contradict this lifetime guarantee with a long terms and conditions document that means, in reality, this claim is not valid. Providing this fine print disclaimer may not be enough to limit your liability.

If you make bold headline statements about your goods, you need to ensure those statements are true. Otherwise, you could be misleading your customers, and any fine print may not protect you under consumer law.

3. Back Up What You Say

When you make claims about a product’s efficacy or nature, to comply with consumer law, you need to have a way to verify your claims. Usually, this is because they are factually accurate, and you have evidence to back up your claims. You need to observe this when you make claims about a product’s:

  • quality;
  • quantity;
  • standard;
  • environmental impact;
  • health or nutrition information;
  • organic nature; or
  • make-up.

For example, if you make claims about the carbon neutrality of your products, you need to have scientific evidence of that fact. You also need to advertise in a way that does not mislead your customers with confusing jargon.

4. Your Pricing Should Be Transparent

When you advertise the prices for your products, customers expect that the price you display is the price they will pay. Therefore, do not leave out any hidden costs or extra fees in the prices you advertise. Otherwise, you run the risk of misleading your customers and breaking consumer law.

For example, say that you advertise your t-shirt prices at $25 each. However, this price does not include GST, and customers would have to pay that extra fee at the time of purchase. You mislead your customers when you do this.

5. Tell Customers When You Use Their Personal Information

An important part of consumer law that protects your customers is privacy law. If you use any personal information to direct your sales strategy or advertising, you need to ensure you tell your customers when you do so. Otherwise, you are breaching their privacy rights, and you could face both legal and financial penalties.

For example, if you collect customers’ email addresses for sending marketing newsletters, you first need their permission to do so. You also need to tell them at the time of collection why you use their personal information and whether you will use it for anything else. 

6. Do Not Mislead Customers About Their Rights

Consumer law gives your customers various rights, particularly in guaranteeing the quality of the goods and services they buy. When you sell to consumers, you need to ensure your goods or services meet their relevant consumer guarantees. When they do not, you need to give your customers an appropriate remedy.

The law requires that you do this. However, some businesses attempt to mislead customers about their rights under the law if a customer comes to them with an issue regarding a product return. If you do this, then you are misleading your customers and breaking the law. You also cannot attempt to offer customers special warranties or guarantees that the law already gives them.

For example, you may sell extended warranties for your products as part of your sales strategy and say that you cover general wear and tear. However, the law already provides this protection for consumers. Therefore, you should not offer in your warranties what the law already provides and attempt to make customers pay for that.

Key Takeaways

If you are misleading your customers with your marketing strategy, then you are breaking consumer law. Therefore, to avoid this you need to focus on transparency and reliability in your marketing and be careful about what you say. If you would like more information or help with aligning your marketing and sales strategy with consumer law, contact LegalVision’s regulatory and compliance lawyers on 0800 005 570 or fill out the form on this page. 

Frequently Asked Questions

What is misleading or deceptive conduct?

Misleading or deceptive conduct can cover a variety of behaviours. However, it generally refers to underhanded behaviour where you attempt to lie to or mislead your customers. The Fair Trading Act prohibits this kind of behaviour.

Can I offer an extended warranty on my products?

You can offer an extended warranty on your products, but you should only do so if it offers benefits on top of what consumer law already provides. For example, you cannot attempt to mislead your customers that you are giving them extra protection for the products they purchase when the Consumer Guarantees Act already does.

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