How it works
Governments impose rules on marketers to prevent
any unscrupulous, misleading, or unwelcome practices,
such as false advertising, the failure to disclose all
terms and conditions, and spam marketing (sending
unsolicited emails). The regulatory body is able to
investigate any company accused of breaking the rules
and impose penalties if it finds the company guilty.
Marketing regulations
To protect the consumer, regulatory bodies produce guidelines
instructing companies on how they should market their products.
Compliance
In most countries, companies have to adhere to laws and industry
regulations that govern how they can sell and market their products.
The rules are there to make sure that businesses operate fairly.
Example of marketing practiceBusiness areas subject to regulation
Comparative claims
“Our model is much better than
our competitors’ models!”
“I owe my success to their product!”
“Buy one, get one free!”
“Enter the prize drawing for the chance to win
the vacation of a lifetime!”
“Good evening. Would you like to save money
on your energy bills?”
“Step right up and enter the House of Toys…”
“Please fill in the registration form.”
“Today only—24-hour online sale!”
“Congratulations! You have been selected…”
“Please uncheck the box if you do not wish to…”
Endorsements
Special offers
Sweepstakes and contests
Marketing to children
Customer data
Telemarketing
Email marketing
Use of spam
Negative-option billing
@
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how sales and marketing works
Information management
“Please fill in the registration form.”
“Today only—24-hour online sale!”
A marketer making a claim that its product is superior to a rival’s must
be able to substantiate it with proof.
A marketer must be able to prove that a person they have used to
endorse a product has used the goods or service they are promoting.
A marketer promoting a product with a special offer must set out the terms and
conditions in writing. In the UK, use of the word “free” is subject to regulation.
All competitions and prize draws must adhere to government
guidelines to ensure that they are fair and impartial.
Telemarketers must promptly disclose key facts of the proposed sale, including
cost and quantity, restrictions and conditions, and refund policy.
Marketers must stick to specific guidelines governing how
they advertise and promote products to children.
Customer information must be stored, managed, and
used in accordance with privacy laws.
It is illegal to use contact lists from external sources. Emails must
disclose their commercial nature to the recipient.
Marketers must refrain from sending bulk unsolicited emails, the most
common form of spam, or other types of unrequested messages.
Any item offered alongside the main product purchased must be presented
as an option to buy, not an item the consumer must take action to refuse.
Typical regulations to protect consumer
66%
of all email traffic
in 2014 was spam
CAN-SPAM Act International legal ruling
that sets out commercial email requirements
and penalties for violation
Phishing Fraudulent sending of emails
while pretending to be a genuine entity, to
gain the recipient’s bank details, for example
NEED TO KNOW
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how sales and marketing works
Information management
“Please fill in the registration form.”
“Today only—24-hour online sale!”
A marketer making a claim that its product is superior to a rival’s must
be able to substantiate it with proof.
A marketer must be able to prove that a person they have used to
endorse a product has used the goods or service they are promoting.
A marketer promoting a product with a special offer must set out the terms and
conditions in writing. In the UK, use of the word “free” is subject to regulation.
All competitions and prize draws must adhere to government
guidelines to ensure that they are fair and impartial.
Telemarketers must promptly disclose key facts of the proposed sale, including
cost and quantity, restrictions and conditions, and refund policy.
Marketers must stick to specific guidelines governing how
they advertise and promote products to children.
Customer information must be stored, managed, and
used in accordance with privacy laws.
It is illegal to use contact lists from external sources. Emails must
disclose their commercial nature to the recipient.
Marketers must refrain from sending bulk unsolicited emails, the most
common form of spam, or other types of unrequested messages.
Any item offered alongside the main product purchased must be presented
as an option to buy, not an item the consumer must take action to refuse.
Typical regulations to protect consumer
66%
of all email traffic
in 2014 was spam
CAN-SPAM Act International legal ruling
that sets out commercial email requirements
and penalties for violation
Phishing Fraudulent sending of emails
while pretending to be a genuine entity, to
gain the recipient’s bank details, for example
NEED TO KNOW
US_266-267_Compliance_Steve.indd 267 21/11/2014 16:28
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