Two Oregon-based advertising companies have agreed to settle Federal Trade Commission charges that they deceptively pitched and charged small business owners for misrepresented advertising opportunities.
The announcement, made on February 11, names Production Media Company and the Ferraro Corp, as the two companies that were selling “exclusive” advertising placements to business owners, knowingly misleading them about where the ads would be printed and distributed.
Better Business Bureau Northwest + Pacific recognizes this as what’s commonly referred to as advertising fraud or an advertising scheme. During the calls to business owners, the defendants told them that for a small fee, they could advertise to hundreds if not thousands of prospective customers, making big promises about where the ads would appear in the community. In ad schemes such as this, BBB Northwest sees complaints alleging the advertisements never appear at all, appear in in far less places than promised, and/or sellers mispresented type, exclusivity or placement of ads.
In this particular FTC case, complaints further allege that if and when their ads were placed, they were not exclusive, often sharing space with competitors. Often times, the business owners had to file a complaint with BBB in order for one of the companies to take action and place the ad. Business owners who did not want to wait any longer struggled to get refunds, as both Production Media Company and Ferraro Corp typically refused to issue refunds.
BBB Northwest is here to support small business owners. We urge business owners to follow these tips if they’re being contacted about an advertising opportunity:
Do Not Commit Right Away: Reputable businesses should not pressure you into an agreement during your first conversation. Never jump into an agreement or contract with a stranger who calls you out of the blue.
Research the Company: What can you find about the business online? Have you checked bbb.org to see if other business owners have complained? Does the business have a physical location you can visit? Make sure you hammer down some of these basics, as well as contact information from the person calling you, to verify legitimacy.
Double Check Terms and Conditions: Always get everything in writing, and always read the fine print. In any advertisement agreement, the expectations should be clearly defined, which includes placement, timeline, price and any stipulating conditions. If the company can’t answer your questions directly, consider calling the deal off.