Since 1892 when the English Court of Appeals ruled on Carlill v Carbolic Smoke Ball Company, companies are legally allowed to make claims they can’t substantiate. The court ruled that reasonable people don’t believe exaggerated promises by advertisers. The legal term for these claims is “puffery.”
The public simply calls them lies.
The practice of puffery is so common in advertising that according to the 2008 Edelman Trust Barometer Survey, only 20 percent of respondents trust corporate or product ads.
Believe it or not, this information will effect the outcome of Ralph’s new test of his advertising. At least, it would if Ralph had been paying attention.
Let’s talk about Ralph. He owns an appliance store which you can check out right here. He purchases four cases of Del Vecchio cappuccino makers from China. Ralph places an ad in the newspaper explaining that after the Del Vecchio cappuccino maker brews up to four cups of espresso in it’s glass carafe, its swivel jet frother will make steamy, frothy milk for cappuccino. The ad boasts that Del Vecchio cappuccino makers are available this weekend at Ralph’s Appliances. Not at the $89.95 one would expect to pay for an appliance of this quality, but rather for only $34.95.
But Ralph doesn’t display those $34.95 cappuccino makers.
When the ad hits the newsstands, the cappuccino makers are still in Ralph’s back room.
Ralph wants to know who’s coming in to his store as a result of his ad. He has concluded that the only way anyone would know about the cappuccino makers would be from seeing his newspaper ad. Therefore, if Ralph forces customers to ask for the item, and tallies the sales, he believes he’ll have a fair test of the effectiveness of that newspaper ad.
He’s not testing the advertising at all.
What Ralph is measuring is a customer’s willingness to ask for something she doesn’t see on display. And he’s limiting that test to those who’ve see the ad and come to the store looking for a specific product.
Will shoppers ask for items they don’t see on display? Some surely will. Most will look for a Del Vecchio cappuccino maker, and not finding it, will simply leave without making a purchase.
They will also tell their friends not to believe any ads from Ralph’s Appliances.
Their friends won’t be surprised. “After all,” the friends reason, “doesn’t every business lie in its advertising?”
So, if forcing shoppers to do things they don’t want to do is a bad test, how does a manager/owner determine the effect of advertising on a specific sale?
Indirectly, My Dear Watson.
Check the day’s total sales, and compare to yesterday, last week, and last year. Any significant change in trending can be assumed to be the result of some outside influence. Barring any other influences, we can assume the advertising was the primary factor.