Government regulation impacts marketing strategies in a number of ways.

Government regulation are laws

which help consumers from business activity which may be harmful to the consumer, which the ACCC
regulates. The Australian Competition and Consumer Commission (ACCC) is an independent
Commonwealth statutory authority whose role is to enforce the Competition and Consumer Act 2010 and a
range of additional legislation, promoting competition, fair trading and regulating national infrastructure for
the benefit of all Australians. The ACCC regulates consumer laws set by the Australian Consumer Law
(ACL) which all businesses must abide or else penalties will be forced upon. Marketing Strategies is a plan
of actions used by businesses to sell, promote or distribute goods and services. This essay will be analysing
deceptive and misleading advertisements, implied conditions, price discrimination, warranties and how
government regulations have impacted these consumer laws over previous business activity.

Deceptive and Misleading advertisement is the use of untrue statements made by businesses in order to sell
their goods and services. The consumer and competition act suggest that deceptive and misleading
advertisement occurs when a business is giving away misleading information, overstating the benefits,
offering discounts and special offers that do not exist, bait and switch advertisement. If a marketing strategy
a business has implemented which has been found to be misleading or deceiving customers it will be
investigated by the ACCC. In March 2012 ACCC alleged that Apple had been Misleading customers about
their ‘iPad with Wifi and 4G’, as the iPad is not compatible with Australian 4G networks. Apple knowingly
continued to sell the product. As a result the ACCC applied action against Apple and were forced to pay the
penalty of $2.25 million for misleading consumers. The strategies that were impacted were the distribution
channels and the advertising, which included billboards, and social media. The government regulation
impacted Apple by having to remove the 4G aspect in advertising which they ignored. They were forced by
the government to pay a fine and change advertisement which made it extremely expensive for Apple. Apple
therefore were not being true to their customers or accurate they made vague statements in order for
consumers to purchase their product as a result they had to pay a fine and lose brand trust from consumers.

Implied Conditions are the unspoken and unwritten terms of a contract. These conditions exist regardless if
they were mentioned or written in a contract, implied terms relating to consumer purchases refers to the
products acceptable quality regardless of whether a product is carrying a warranty, a business must by law
either refund a customers money or offer an exchange if the good is faulty at the time of leaving the store. In
February 2016 this was the case with Woolworths, as they sold products which were unsafe and many
customers were injured by products including the drain cleaner, stool and frying pans. The ACCC state that
Woolworths made false or misleading representation about the safety of their products. Woolworths
knowingly did not stop selling the product therefore they engaged in conduct that was misleading or
deceptive. The ACCC also found on the drain cleaner it had printed instructions implying it had a child-proof
cap which was false as the caps were ineffective and did not lock properly. Also Woolworths knowingly sold
frying pans which had handles that would detach. Woolworths received news of injuries but continued to sell
these products. As a result Woolworths had to pay $ 3 million in fines and Woolworths also ended up
changing their product life cycle which cost $20 million. The strategies which were impacted were the
distribution channels, physical evidence and the generic brand strategies which Woolworths had
implemented and the packaging Woolworths had for their product. Physical evidence was impacted as this
put a negative image on Woolworths. The ACCC regulated Woolworths to pay a fine of $3 million.
Government regulations impacted ways for Woolworths to package their products and the overall quality
was questioned, due to this Woolworths lost some trust from their customers and also in their generic brands.
Woolworths selling harmful products is unethical as the products truth and accuracy was false and
Woolworths sold products which damaged the health of customers, also Woolworths made false statements
about their product therefore it made it ethical. This heavily damaged trust between consumers and also
damaged Woolworths brand image.
Price Discrimination is the process of a business giving preference to some retail stores by providing them
with stock at lower prices than is offered to the competitors of those retailers therefore competitors are being
discriminated against by being forced to pay a higher price. Price discrimination reduces competition. This
was the case with petrol companies price gouging were people in regional Australia are paying more for
petrol compared to the city. People in regional Australia pay an extra of 17 cents per litre for petrol. The
ACCC state that every additional cent per litre nationwide costs consumers close to $200 million a year,
however, the ACCC does not have enough evidence to take expose petrol companies. The ACCC found last
month the margin between wholesale and retail prices in September quarter was at it’s largest since 2007.
Petrol companies had been using strategies such as loss leader and price skimming. Petrol companies in the
city area are performing loss leader strategy in order to gain more customers. Whereas in regional (Outback)
Australia, petrol companies are price skimming in order to get the highest possible price as their is limited
competition. There is limited evidence suggesting price gouging has occurred therefore the ACCC is still
investigating. According to the ACCC petrol companies have not engaged in fair competition which is
suggesting they have used manipulative, high pressure selling methods which is unethical as well as illegal,
for example petrol companies are selling petrol below costs which can put competitors out of business. This
also impacts the government as the government encourages competition, and it impacts consumers in
regional areas as they are paying unnecessary amounts for petrol and city people are paying less.

A warranty is a promise by the business to repair or replace faulty products, businesses have an obligation to
provide a warranty. Government legislation have made it compulsory for businesses to state clearly and
simply the terms and conditions of the warranty. A warranty assures the customer that the business has
confidence in the quality of the products and will repair or replace a faulty product. In April 2017 Apple
violated obligations concerned with Warranties, and according to the ACL Apple were misleading
consumers. The ACCC state that Apple breached the consumer law by denying warranty to consumers who
have previously repaired their product previously with third party repairers. Apple say despite any fault
Apple will not repair the product if repaired previously by third party repairers. The ACCC allege that
breaches of the law relating to 275 customers, with each breach carrying a maximum penalty of $1.1 million.
Under the ACL consumers are entitled to have goods repaired at no costs if the product is not of acceptable
quality. The ACCC was also concerned that Apple staff were directing consumers with faulty non-Apple
manufactured products purchased from Apple, to the manufacturer for resolution of the consumer’s
concerns.The ACCC is seeking penalties, injunctions, declarations and compliance program orders. The
marketing strategies which are impacted is publicity and personal selling. Publicity is any free news story
about a business’s product, which is a free and not controlled by the business, such as Youtube videos about
the new iPhone. Personal Selling involves the activities of sales representatives of a sales representative
directed to a consumer in an attempt to make a sale such as retail sales assistant. The ACCC have regulated
Apple to continue to offer consumer redress program in which consumers potentially affected by the alleged
conduct can go to Apple to have their claims reassessed by Apple in accordance to the ACL. Apple must
continue to implement a program to improve ACL compliance in which training of Apple staff sales and
management staff and all Apple call centre representatives who have contact with Australian consumers.
They must continue to monitor and review its ACL compliance going forward to ensure the conduct of
concern to the ACCC does not happen again. They are also required to maintain a webpage aimed at
providing information and clarifying the differences between the coverage provided by the ACL and Apple’s
voluntary limited manufacturers warranty. Apple have not engaged in fair competition as they are restricting
their customers from repairing their products from third party repairers. Apple are not engaging in truth,
accuracy and good taste in marketing as their staff were not telling consumers about the manufacturers
warranty according to the case study. As a government regulation Apple put remedies into place such as a
program to improve their relationship with the ACL which includes training their staff and management in
their specific area.

Government regulation impacts marketing strategies in a number of ways. Government regulation are laws
which help consumers from business activity which may be harmful to the consumer, which the ACCC
regulates. The ACCC regulates consumer laws set by the Australian Consumer Law (ACL) which all
businesses must abide or else penalties will be forced upon. This analysis of how government regulations
impact marketing strategies.