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Questionable Spin: Ads make bold and sometimes misleading claims

Tough economic times are prompting mainstream marketers to try some audacious stunts to generate awareness and sales.

business Updated: Jan 12, 2010 17:55 IST

Tough economic times are prompting mainstream marketers to try some audacious stunts to generate awareness and sales.

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Just last week New York outerwear company Weatherproof Garment Company posted an attention-getting billboard in Times Square. In the ad President Obama is pictured in China, where he is wearing a jacket apparently made by the company. Trouble is, Obama isn't a company spokesman. The White House called the garment company and asked it to remove the billboard, which the company's director of public relations, Allen Cohen, says it will do, with reluctance.

Jumping on consumer interest in healthier eating, other companies are suggesting their products have some over-the-top benefits. Taco Bell, owned by Yum! Brands ( YUM - news - people ), in Louisville, Ky., recently rolled out the "Drive-Thru Diet," spotlighting a customer who supposedly lost 54 pounds in two years by ditching her old fast-food grub in favor of Taco Bell's Fresco menu. (See: "On the Spot.") The company's "diet" pitch is a stretch for many who doubt fast food can help with weight loss.

In tough times marketers tend to push the limits with their claims, hoping to cash in on consumer trends and interests--for now, that includes health, weight loss and all things "green," says Mary K. Engle, the Federal Trade Commission's associate director for advertising practices. "The biggest problem tends to be that marketers let claims get ahead of science," says Engle.

Kellogg's, the world's largest cereal maker, clearly hoped H1N1 fears would help it sell more Cocoa Krispies. The Battle Creek, Mich. company put "now helps support your child's immunity" on cereal packaging. It changed the wording on boxes in November after filed complaints with the Food and Drug Administration.

The Federal Trade Commission also challenged the cereal maker last year, after Kellogg's claimed in a national ad campaign and on product packaging that its Frosted Mini-Wheats boosted children's attention span by 20%. The truth? Only half of the children Kellogg tested showed improved attentiveness, and only one in nine improved by 20%. Kellogg did not pull the campaign, instead tweaking its message to settle the FTC suit. The company now suggests the cereal keeps kids "focused."

The downturn is also helping scam artists prey on consumers looking for financial stability, Engle says. The FTC cracked down on three supposed inventors who pitched get-rich-quick ploys through telemarketing services, duping several hundred thousand people into buying $39.95 monthly contracts for personal financial coaching services. The schemes, John Beck's Free & Clear Real Estate System, John Alexander's Real Estate Riches in 14 Days, and Jeff Paul's Shortcuts to Internet Millions, pulled $300 million from consumers' pockets.

Companies are scrutinizing competitors' pitches more than ever, so often rival companies cry foul when another marketer makes an over-the-top product claim that could give them an edge. Last year a record 85 companies brought legal disputes against other companies for advertising claims--slightly more than in 2008 but way up from 63 in 2007, says the Council of Better Business Bureaus' National Advertising Division.

Those in court included telecommunication giants AT&T ( T - news - people ) and Verizon ( VZ - news - people ) (disputing which one has the most expansive mobile coverage), along with PepsiCo ( PEP - news - people )'s sports drink Gatorade and rival Coca-Cola ( KO - news - people ) brand Powerade (probing Powerade's claim of being the most "complete" sports drink on the market).

Experts expect there will be more such ads--and complaints--to come as marketers continue vying for sales. "It's all about brand visibility and getting an ad out there," says Paul Kurnit, a marketing consultant in New York City and author of the Little Blue Book of Marketing. "In a blogging and Twittering era everyone wants to do something worthy of talking about."