LAW, ETHICS AND CORPORATE GOVERNANCE
Bait and Switch
1. Betty drove three hours in one-hundred degree heat. Explain if this fact has any bearing on whether or not the dealer must perform in accordance with the published advertisement. Advertising is a medium through which sellers communicate with potential consumers (“advertising”, 2006). Advertising constitutes a major component of an organization’s marketing strategy and is a $200 billion-a-year business in the United States (“advertising”, 2006). There are many forms of advertising but the traditional advertising methods include magazine and newspaper ads, television commercials, radio commercials and outdoor billboards (“advertising”, 2006). In the video, Advertising and Communication Law the customer, Betty Algur, has traveled a long distance to the car dealership to purchase a new truck she noticed in a newspaper ad. As Mrs. Algur enters the dealership she is greeted by one of the salesmen, Tony. The customer mentions to Tony that she drove three hours in one hundred degree heat to purchase the truck in the newspaper advertisement. Ads are used to influence the public into purchasing particular products (Chevere, 2010). Consumers can be influenced by the strategic language and imagery in advertising, which helps point out the strengths of the products and services that are being offered (Chevere, 2010). Without advertising, it is possible that consumers may not hear about special promotions a company is offering for products and services that could be beneficial for them (Chevere, 2010). In the case of advertisement for Rally Motors, Mrs. Algur decided to drive three hours in one hundred degree weather because she was influenced by the ad to purchase the truck. In my opinion, the fact that Mrs. Algur had to travel a long distance in extreme heat does not have any bearing on whether or not the dealership must perform in accordance with the published advertisement. The dealership does not have to make decisions based on a customers difficulty or obstacles they may endure in order to get to the dealership to take advantage of the advertisement. Advertisements, catalogues or store flyers are not considered offers (Duhaimes contract Law). The law calls these invitations to the general public to make an offer on a particular item (Duhaimes Contract Law). It seems to be clear that Betty is relying on the advertisement for the product she wants to purchase but the circumstances she faced getting to the dealership has nothing to do with the decision the dealership chooses to make.
2. When Tony said over the phone “three thousand dollars firm” he was making an offer that, if accepted, would bind the dealership in contract. A contract is defined as an agreement with specific terms between two or more persons or entities in which there is a promise to do something in return for a valuable benefit known as consideration (contract, n.d). Since the law of contracts is at the heart of most business dealings, it is one of the three or four most significant areas of legal concern and can involve variations on circumstances and complexities (“contract”, n.d). Contracts can be either written or oral, but oral contracts are more difficult to prove and in most jurisdictions the time to sue on the oral contract is shorter (“contract”, n.d). There are also several types of contracts such as “conditional”, “joint & several” and “implied” (“contracts, n.d.). According to the video, Mrs. Algur and Tony had a conversation over the phone about the amount she would receive for her trade-in. She mentioned to Tony that he said she would receive three thousand dollars for the trade-in. Tony did not mention that there were any conditions during the phone conversation, he said three thousand dollars firm. It seems from the conversation that Tony and Betty were making an oral agreement on the amount of the trade-in.