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Unfair competition in internet advertising

Businesses in Texas are constantly trying to figure out new and up-to-date advertising methods to draw in more customers. The internet has become a major medium for advertising and marketing, and companies need to understand the rules surrounding this type of advertising so they do not break any laws.

According to the Federal Trade Commission, the laws regarding unfair competition in advertising apply to all online marketing as well. In the general sense, this means companies must be truthful in their advertising claims, the claims must be substantiated and the customer must not be misled. Online advertising is considered to be a deceptive act when a misleading claim is substantial, it cannot be avoided reasonably and there are no other benefits to balance it. When it comes to online marketing, companies should also keep in mind the following:

  • Demonstrations - they must demonstrate performance under normal use
  • Disclosures - this can help remedy a false claim, but it must be clear and easy to read
  • Refunds - if offered, they must be honored
  • Advertising to kids - there are specific guidelines for companies whose message is directed towards young children

FindLaw discusses two technologies that are geared specifically to internet marketing and can result in unfair competition when not used correctly. These are linking and framing, which can lead consumers to other company's websites. While they can be effective tools for all parties involved, there are rules surrounding these practices, and companies should follow certain guidelines. These include:

  • Avoid using another company's logo as a link
  • A written agreement should be signed before framing another website's content or linking to the website
  • Link to a third party's main site rather than deep link it
  • Modify framing and linking practices when necessary 



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