The Truth About False and Deceptive Advertising

How to keep ads from getting the best of you (and your wallet).

How to keep ads from getting the best of you (and your wallet)
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Whether on the television, radio or city bus, consumers face a barrage of advertisements throughout the day. Amidst the enticing slogans and images, it can be hard to tell which products and services are really worth the hype – and which could lead to shopper's remorse.

Before you dial that 800 number or checkout your online shopping cart, consumer protection experts advise taking a moment to educate yourself about what exactly you are (or are not) buying. There's more to advertising than you might think, and understanding exactly how advertisers attract consumers can alert you to potential deceit.

How advertisers draw you in. Advertising is a combination of marketing and science, or neuromarketing, according to Martin Lindstrom, author of the New York Times best-seller "Buyology: Truth and Lies About Why We Buy," which details his study of how ads affect consumers. Advertisements operate on two tracks: the conscious, using information you can read and understand, and, more commonly, the subconscious, using information and techniques that you are not clearly aware of. "Seventy-five percent of everything you and I do every day takes place in our subconscious mind," Lindstrom says. "In my opinion, advertising industries are doing pretty well in terms of drawing us in. Most of us think we are deeply rational but we are really not."

Subconscious advertisement techniques can include making soda poured over ice in a glass have a high amount of bubbles or increasing the noise of a steak sizzling on a grill. "It triggers our craving instinct," Lindstrom says. "It's the same spot in your brain that's activated when you are gambling, hungry for chocolate or jogging."

Even if consumers aren't giving an advertisement 100 percent of their attention, that doesn't mean the ad's message doesn't get through. "For example, most people don't watch TV commercials anymore, [they] listen to them," Lindstrom says. "Because you are not directly focused on the screen, your critical senses are dialed down and you are much more affected by the messages because you let everything come on board."

[Read: How Online Retailers Get You to Spend More.]

Another common subconscious advertising technique is creating a sense of urgency. "The ads that are getting the most attention and are most successful are the ones that call consumers to quick action," says Brent Brien, the American Consumer Protection Group's senior vice president of enforcement. "When people feel there is a sense of urgency, they don't process or scrutinize information correctly."

Advertisers also reap benefits by igniting fear in consumers. "We are hardwired to override any other behavior when fear comes into the equation," Lindstrom says. Sending an audience the right message at the right time, also called contextual advertising, helps create consumer fear. For example, a home insurance company could purchase printed ad space near a story about wildfires. "You may think that it is pure coincidence, but it's not," Lindstrom says. The variety of mediums advertisers use can make contextual messages more advanced, as companies begin to feed off consumers' social media profiles and Internet activity.

What to watch for. There are three general types of companies that engage in deceptive advertising practices, according to Brien. "'Fraud-by-night companies are generally just outright frauds and are gone in a month or two after they take what they can," Brien says. "We believe those companies are the most harmful to consumers and the marketplace. There are also companies that have been around for a little while and aren't really widely known, but engage in massively deceptive behavior and until government entities take notice, they can operate like that for years. The third type is made up of larger companies practicing hidden deceptive behavior where consumers generally can't file litigation action themselves because they don't have the resources to uncover the deception."