If you own a small business, you probably want to know how you can increase sales. One good way of increasing sales is by marketing your business. Marketing can include advertising and direct contact, like telemarketing or direct mail. It can also involve hiring an advertising agency to market your business for you.

Advertising

When you advertise your business, you are making known to the public what your business is and what goods and/or services you sell. The medium that you use to advertise your business depends on what potential customers you would like to reach.

Perhaps the most common form of advertising is placing a notice or advertisement about your business in the business telephone directory for your area. Other forms of advertisement include radio and television commercials. Some companies advertise in popular or professional magazines. The newest form of advertising is probably online advertising.

When you are preparing advertisements for your business, it is important to be truthful. You don't want to be sued for false advertising or unfair and deceptive practices. Make sure that you are truthful about:

  • The length of time your business has been in continuous operation
  • The size of your business
  • The financial condition of your business
  • The nature of your business, such as a dealer or a manufacturer

Telemarketing

Telemarketing involves the use of the telephone or a fax machine to sell your products. The process can be as simple as going down the list of names in a local telephone directory, calling the people listed there and trying to sell them your products. More sophisticated telemarketers use computer-driven, random, sequential dialing, or automatic dialing equipment to reach potential purchasers.

The federal government and many states have put legal restrictions on telemarketing. The federal Telephone Consumer Protection Act of 1991 prohibits unsolicited, automated telephone calls to homes and certain uses of fax machines and automatic dialers in interstate or intrastate commerce. State laws also restrict the use of automatic dialing and answering devices. Some states have laws setting up a "no call" list which prohibits telephone solicitations of people on the list.

Direct Marketing

Direct marketing involves situations in which there is some form of personalized direct contact between the vendor and the consumer. These types of contacts can occur through both electronic and print media, as well as in person. Besides telemarketing, this category includes:

  • Print media sales, which most often occur through direct mailing, and
  • In-person solicitation, which most often occurs in door-to-door sales

Direct marketing methods are regulated by the Federal Trade Commission (FTC). Under the FTC's rule, people and businesses that sell products by telephone or direct mail have to ship the product within a certain amount of time and must allow customers to cancel their orders. States may take actions under their deceptive practices laws to regulate direct marketing practices.

Advertising Agencies

Sometimes, a small business will hire an advertising agency to conduct its marketing campaign. This can be an effective, yet somewhat expensive, method of "getting the message out" about your business. A good advertising agency will know the market and the methods of successfully bringing in business. The agency's experience should help guide you in your advertising decisions.

Advertising agencies have to comply with the laws, just like you. They cannot monopolize a market or violate copyrights. They cannot engage in false advertising or in false or deceptive practices. They have to comply with federal and state laws. Although an advertising agency can provide valuable services, don't assume that the agency can do anything that it deems appropriate.

If you have any legal questions about marketing or advertising your business, contact a small business lawyer in your area.

Questions for Your Attorney

  • If I own a small business that designed equipment for five years and then manufactured equipment for five years, can I say in an advertisement that my company has been in business for ten years?
  • Who can sue my business for false or deceptive trade practices? Only consumers who have done business with me?
  • Am I legally responsible for the actions of an advertising agency that I hired to conduct a marketing campaign?