Sauder marketing division research shows link between deception and consumer doubt in advertising circles

VANCOUVER, BC – Companies who embellish or lie in their advertising endanger both themselves and their competitors and can cause consumers to doubt even truthful ads, according to new research from the Sauder School of Business at the University of British Columbia.

The research is co-authored by Peter Darke, Honorary Assistant Professor at Sauder School as well as Assistant Professor at Florida State University, and Robin Ritchie, Assistant Professor of Marketing at the Richard Ivey School of Business.

It appears in the current issue of the Journal of Marketing Research.

Advertising deception produces skepticism and distrust toward subsequent ads – and it doesn’t only affect the original product or company. In the study, people who had been deceived by one particular ad generalized from one advertiser to the next, across different kinds of products and types of advertising claims. Deception can also lead consumers to ignore important, potentially beneficial information about other products.

Study participants were shown a series of ads for a fictitious group of products, ranging from a dishwasher, a television and an answering machine. The researchers found that deceptive advertising evoked a general negative attitude towards further advertising, not just for ads from the same deceptive source but also for advertisements that had no connection to the original company.

“This research shows that deceptive advertising causes consumers to stereotype marketers as untrustworthy as a whole,” says Darke. “This is what leads them to lump the "good" marketers in with the "bad" marketers. Further, we have evidence that consumers are not always aware of the fact that they are stereotyping marketers in this way. That is, consumer suspicion acts automatically or unconsciously to undermine the credibility of marketers as a group.”

The generalized effects of distrust on advertising that researchers found suggests that deceptive ads have the potential to be damaging to advertising in general, and thus to firms that rely on advertising to sell their products. Firms should be concerned about their peers’ deceptive advertising practices, including not only immediate competitors but also advertisers in other product categories and other geographic markets.

The research makes a strong case for the importance of avoiding deceptive advertising claims, not merely out of concern for fairness to consumers but also as a means of preserving the effectiveness of marketing communications as a whole.

It also suggests marketers should strive to develop strategies for dealing with distrustful consumers in the marketplace. As well, marketers should seek alternative means of communicating with consumers who are skeptical of advertising or hold general negative stereotypes about marketing – such as viral marketing aimed at increasing positive word-of-mouth among consumers themselves.

“The suspicion generated by deceptive ads hurts consumers in the sense that they may fail to recognize the true merits of the good products and companies that exist in the market,” says Darke. “While healthy skepticism can cause consumers to think more carefully about what they are buying and who they are buying it from, the kind of defensive suspicion induced by false advertising causes consumers to adopt a rigid, overly negative bias towards marketers and their products.”

For more information, contact:

Derek Moscato 
Sauder School of Business
Tel: 604-822-8345
Cell: 604-306-7137
derek.moscato@sauder.ubc.ca

Leanna Yip 
Director, Marketing and Communications
Sauder School of Business
Tel: 604-822-0229
Cell: 604-616-0400
leanna.yip@sauder.ubc.ca