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False health claims are nothing new to business and advertising. From special elixirs said to re-grow hair to diet pills, businesses have unfortunately benefited from these fluffed fabrications, misleading not only consumers but health trends. That’s where the Federal Trade Commission comes in. In coordination with the Food and Drug Administration, the FTC seeks to protect consumers from this type of false advertising, which unfortunately is an all too common mistake still made by companies today; according to their website, the FTC has filed 120 cases related to false health claims within the last decade. However, that doesn’t include any products that dance on a fine line. Truth in Advertising’s article brings one particular example into discussion, GT’s Kombucha.

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What started as humble home-brew beginnings, GT’s Kombucha has gained large popularity and exposure for its unique taste and digestive health benefits, available at a variety of stores from Whole Foods to 7-11.

With an increase in health and fitness trends across the Unites States, what were once small niche health brands have met such great demand, they can now be found in convenience stores like 7-11. GT’s Kombucha is a prime example, now a leader in market share for probiotic drinks. If you are unfamiliar with the beverage, kombucha is a cultured tea known for its rich source in probiotics, antioxidants, amino acids, polyphenols and active enzymes. The tea has been a hot topic in recent years for its recognized health benefits. However, there are certain health claims that have been made that have remained scientifically unproven or tested, such as the drink’s ability to cure acne, Aids and in GT’s particular case, cancer. GT Dave, the founder of the kombucha company testifies to the health benefits his drink provided his mother when she had suffered from a severely aggressive form of breast cancer. As the origin story goes, “When she healed, Laraine shared with doctors that she had been drinking a very pungent, homemade tea. That tea was GT’s Kombucha. Inspired by his mom’s experience, it became GT’s mission to make his Kombucha accessible for everyone, everywhere. At only 15, he began bottling his brew in the kitchen of his parents’ Southern California home and became the first to put Kombucha on shelves in the U.S.”

Truth in Advertising asks the question as to whether or not this could be considered a false health claim. When the product first became available at stores, the story of GT’s mother was printed on the label, but after class-action lawsuits in 2010 over the alcohol content of the beverage as well as some iffy health claims, the label was removed from the packaging. In an interview with Inc. Magazine, GT Dave pointed out that they had never used the word cure, nor did the company create any direct associate to the cancer’s treatment, but rather to the support of Laraine’s immune system. Though no longer on the label, the story remains on the website, and founder GT Dave still refers to the story in interviews.

GT’s Kombucha is an important example for marketers where if a company is not careful, they can teeter between financial success and a case lawsuit.  However, there are ways marketing managers can prevent such actions from taking place. In order to help educate marketers and prevent such cases, the FTC published 5 principles to help marketers keep lawful practices.

First off, if your company is going to make a serious medical claim, have a reliable science source to back it up. It’s also important to remember that your product doesn’t have to be a supplement or food to be subject to this. For example, in 2015, the FTC had settlements with two companies who claimed their app could detect symptoms of melanoma. The second point is to be thoughtful when using consumer testimonials; does your company have a specific relationship with the consumer that might affect the credibility of the testimony? Also, remember that testimonials are providing evidence of desired results, but perhaps not general results. If that is the case, the FTC suggests “clearly and conspicuously [disclosing] the generally expected performance in the depicted circumstance.” The third point is “heed words of warning.” If your company receives a letter in the mail from the FTC warning you about your marketing practices, it is best to play it safe. The fourth point is don’t go hopping on the bandwagon. Just because one company trumpets the health benefits of a specific product without evidence doesn’t give any team the excuse to do the same.  The last and final point is there are likely no second chances. If your company continues to make the same mistakes in marketing false or foggy claims, it most likely will meet its end. In one particular case, Crystal Ewing, who disregarded settlements against her actions in promotions was not only banned from sweepstake promotions, but also later the weight loss business.

False advertising is nothing to mess around with, especially when it involves your consumers’ or clients’ health. Though the numbers and figures made by other companies through such malpractices may seem tempting, the legal as well as ethical issues involved with false health claims is something marketing managers can’t forget; Not only could your company be put at risk, but more importantly, the health of your consumers could be put on the line.

From a marketing management perspective, here are some questions to think about:

  • What other industries or products must marketing mangers consider that could possibly by subject to false health claims?
  • What managerial strategies can be used to prevent false advertising?
  • What are other ethical issues marketing managers need to keep in mind when it comes to advertising?