On advertisements and the truth

Kudos to kitchen tigress for teaching local bank, OCBC, a lesson on misleading advertisements!

Briefly: OCBC had been advertising that it surprises its customers with birthday cakes on their birthdays. On her birthday, kitchen tigress went to OCBC to claim her birthday cake, but was told by staff that it was just an advertisement and they don’t give birthday cakes to customers. This didn’t faze kitchen tigress one bit, and after sticking to her guns, an OCBC supervisor eventually relented and bought her a cake.

For too long, advertisers in Singapore have gotten away with feeding misleading advertisements and outright lies to consumers. This should stop. Here, OCBC advertised and gave the expectation that its customers would be surprised with birthday cakes – this didn’t happen for kitchen tigress. As for other misleading and possibly even false advertisements, these include weight loss services by slimming centres, hair growth products and services, and of course, financial products that are supposed to be “safe” (we all know the recent famous example which needs no introduction).

Companies should learn to tell the truth when advertising their products and services. If you can’t be truthful, then you shouldn’t be allowed to peddle your wares.

Do we have laws in Singapore regarding false and misleading advertisements? To some extent, we do. For example:

• There is the Misrepresentation Act, where if a person enters into a contract under a misrepresentation, then that person is entitled to cancel the contract, and possibly claim for losses suffered.



• There is the Consumer Protection (Fair Trading) Act, where it is prohibited for a supplier to (a) cause a consumer to be deceived or misled, (b) make a false claim, or (c) take advantage of a consumer.
  
  Examples of such behaviour include (i) representing that goods or services have performance characteristics or benefits that they do not have (weight loss or hair growth products and services may fall into these category), and (ii) offering gifts, prizes or other free items in connection with the supply of goods or services if the supplier knows that these items will not be provided (OCBC’s free birthday cake may fall into this category).



• There is also an interesting concept in law, where if someone advertises that he would do something in return for your action (say for example, give you a surprise birthday cake if you sign up as a bank customer), and you actually do it, then it is a binding contract in law and that someone has to fulfil his promise!
  
  A famous case which happened in England in 1892 was the “Carlill vs. Carbolic Smoke Ball Company” case, where a certain Carbolic Smoke Ball Company advertised that its “smoke ball” would cure flu, and if it did not, buyers would receive £100. Ms Carlill tried the smoke ball, which failed to cure her flu. When Carbolic denied giving her the £100, saying that it was only an advertisement gimmick and not to be taken seriously, Ms Carlill sued Carbolic and successfully got her £100.

Now, the abovementioned laws are not very effective, because they do not make it an offence for companies to advertise in a false or misleading manner. These laws only help consumers who are willing to go to court to seek redress. However, hardly anyone would bother going to court to seek redress – it’s troublesome and usually not worth the while because most people would not have spent very much anyway on the actual good or service.

So what can the government do to properly protect consumers in Singapore? Easy, pass a law that bans and makes it an offence to have false or misleading advertisements. This way, the onus is on companies and advertisers to be mindful of their responsibility to the public.

For completeness, it should be mentioned that a few items, such as medicines, have statutory regulations making it an offence for persons or companies to advertise them in a false or misleading manner in Singapore. But for most products and services in general, there are no such laws, and it’s about time something is done.

The objective here is not stifle creativity in advertising. For example, a tagline such as “Red Bull gives you wings”, while it is a cute tagline, the Red Bull beverage of course doesn’t give its drinkers any wings, and no reasonable person would expect it to do so, so there’s no harm (just a note here: in the opinion of this author, companies can come up with great taglines which are genuine, such as “HSBC – the world’s local bank”. Now that’s something which HSBC can try to deliver to its customers). But if a company advertises something that is humanly possible (such as a birthday cake surprise for its customers), then it should jolly well carry out its promise.