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MARKETING AND ADVERTISING VEHICLES AND CREDIT TERMS
A wrinkle on prescreening is “trigger leads.” Trigger leads are sold by credit bureaus that prescreen customers, but
the credit bureaus do not communicate the consumer’s name and contact information (usually a cell phone number)
to the prescreen client until another auto dealer pulls the customer’s credit report. At that point, the prescreen client
(typically a lender or another auto dealer in partnership with the lender) will call the customer on the customer’s cell
phone and attempt to induce them away from the original dealership that pulled the credit report. They will do this
often by claiming to offer better purchase or financing terms on the vehicle or aftermarket products. Some customers
literally have been called on their cell phones while still in the original dealer’s F&I office.
Trigger leads have been approved by the FTC for consumers seeking mortgage financing. However, neither the FTC
nor any court has approved trigger leads for indirect auto finance, and trigger leads in the mortgage context are
prohibited in a number of states including Connecticut, Kansas and Kentucky.
Prescreening differs from preapproval inquiries in that a consumer who passes the prescreen criteria must
receive a firm offer of credit. Persons who do not pass the prescreen criteria do not need to receive adverse action
notices unless they otherwise affirmatively apply for credit and are declined.
Social Media Advertising
Another area of advertising and customer
communications is social media, being sites
such as Facebook, YouTube, LinkedIn, Twitter
and others. These sites have gained increasing
popularity – Facebook has over 300million users in
the U.S. Social media sites offer dealers a new way
to connect with consumers through consumers’
principal means of staying in touch with friends,
colleagues and companies with whom they have
an interest or a relationship. All of the advertising
laws and regulations described in this Chapter
apply to advertising in all media, including social
media.
In March 2013, the FTC issued an update to its “Dot Com Disclosures” guide to advertisers on making effective
online disclosures. In doing so, the FTC emphasized that consumer protection laws apply to all advertising,
regardless of the medium used, and include social media even where there is limited space. Disclosures required
to avoid deception or otherwise comply with the law must be presented in a clear and conspicuous manner and
space constraints in social media do not relieve you of your obligations to make clear and conspicuous disclosures.
You need to understand how your ads—including any disclosures required—will actually display in the medium
or media in which they appear. This is especially important since it has been estimated that consumers use a cell
phone or tablet approximately 80% of the time to surf theWeb. The FTC warned that if you cannot make a required