Remember Elizabeth Holmes and the Theranos scandal? When a $10 billion Health Silicon Valley tech company pretended to have a product of blood tests that it actually didn’t? Yeah, that one.
The failure of the Fyre Festival (A luxurious music festival in the Bahamas with “the best in food, art, music and adventure” and tickets ranging from $5,000 to $250,000) also revealed how vulnerable consumers are to aesthetic of products or events through social media campaigning—although they must have been really gullible to fall for the founder, Billy McFarland’s promise again as he has had a history of falling short with his other company Magnise. I guess this is the effect of an instagram powered economy where brands prioritize their image instead of living up to it.
It’s also been reported that Amazon has fake reviews and even colleges have been called out for their false rankings and incorrect data (https://www.insidehighered.com/admissions/article/2018/08/27/eight-more-colleges-identified-submitting-incorrect-data-us-news)
False advertising is hard to detect these days, especially with seemingly trustworthy marketing ploys and advanced technology. There’s always some company out there trying to trick you, disguising and deceiving in order to pickpocket your wallet. Both monopolistic and oligopoly competition use advertising to differentiate their product but for oligopoly, more so to establish high barriers for entry and exit. Their advertising serves a purpose of making the demand more inelastic while simultaneously increasing the demand for the product/service. But if it it’s intended to sway consumers, maybe they should start listening to consumer complaints more closely before and follow the order of first designing the product and organizing logistics like testing to see if it works and then advertising.
Aditi, this was a great post. False advertising certainly is an issue in our society today, and I think that the government has not caught up with the technology as far as regulation goes. Companies and corporations have found clever ways to get around the existing regulations on false advertising, and it is hurting consumers. Accountability is a big part of capitalism, because if the supplier can't be trusted, the buyer won't buy and the system shuts down. You mentioned the Fyre festival. I remember reading about it before it was going to be held, and thinking to myself that it could be quite interesting. I also remember my disappointment and shock when it was reveal to be a total disaster. McFarland and rapper Ja Rule paid social media personalities like Kendall Jenner and Bella Hadid to promote the festival on their accounts, despite knowing that the festival was not what they promised. In this case, the consumer is directly hurt by the fraud, and the legal crackdown reflected that. I'd hope in the future that the legal system can crack down on false advertising that indirect hurts consumers.
ReplyDeleteThis is a great post about something we can all relate to in society today, fake advertising. With all the new technology, advertisers will do whatever they can do get your click and make you buy a product. The Fyre Festival is a very interesting example of this, and shows how bad it can get. This relates to all the controversy over fake news in recent times.
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