Comparative Price Advertising: Informative or Deceptive?

Abstract

An issue currently generating considerable debate is the increasing use of the comparative price format in advertising. In this paper, reviews of comparative price advertising literature and Federal Trade Commission (FTC) guidelines are integrated to discuss whether comparative price advertisements are informative or deceptive. Recent court cases relevant to comparative price advertising are also discussed. The central focus of the paper is to articulate the state of knowledge regarding comparative price advertising and to assess its potential for being informative or deceptive using an examination of relevant literature and public policy. Recommendations regarding comparative price advertising for public policy makers, managers, and researchers are developed.