Search Engine Marketing and the ACCC

A recent case involving the online Trading Post and the ACCC has some important implications for pay per click advertising and search engine marketing in general. An article in B&T Weekly states the facts pretty clearly:

“The meteoric rise of search engine marketing hit its first bump this week when the Australian Competition and Consumer Commission put online marketers on notice after the Trading Post agreed to stop using a competitor’s trademarked name as a sponsored internet link.

The Telstra-owned Trading Post had purchased the name of competitor Stickybeek, an online classifieds site, as a sponsored link on Google.

The result was that when ‘Stickybeek’ was typed into the Google search engine, a Stickybeek ad appeared in Google’s sponsored-links section – however, when users clicked on the Stickybeek ad link, they were automatically sent to the Trading Post’s autotrader website.”

This sounds like pretty sneaky tactics to me, but the Trading Post did not consider its conduct was misleading under the Trade Practices Act – although it did agree to stop using competitors names in sponsored links.

The ACCC issued a warning on its website to businesses using internet marketing:

“With the internet increasing in importance as a medium for businesses to advertise and market their goods and services, the ACCC is focused on ensuring the internet is not misused to mislead or deceive consumers.

The consumer protection provisions of the Act apply equally to marketing over the internet as they do to advertising by more traditional means such as television or newspapers. This matter highlights the need for business to remain vigilant when taking advantage of new marketing opportunities offered by the internet that care is taken to avoid potentially misleading consumers.”

I’d have to agree with the ACCC that there needs to be checks and balances in place to ensure against the unscrupulous tactics of some website owners. That way consumers can enjoy the convenience of relevant pay per click ads, and businesses can get the best results for their search engine marketing campaigns.