Marketing via social media presents the potential for Dark Patterns, and dealers should consider how they are employing these applications. - Pexels/FUTURE KIIID

Marketing via social media presents the potential for Dark Patterns, and dealers should consider how they are employing these applications.

Pexels/FUTURE KIIID

Dark Shadows (Not Patterns)

“Dark Shadows” was a television soap opera in the 1960s featuring vampires, warlocks and the occult.  Conversely, Dark Patterns is a legal theory postulated by the Federal Trade Commission and the Consumer Financial Protection Bureau CFPB to sue businesses, such as auto dealers.  They both sound and appear to be born out of the supernatural. However, the FTC and CFPB have announced plans to prosecute Dark Pattern violators.

A Word about Venus Flytraps and Regulators

Venus flytraps are carnivorous plants that feed on insects with their crocodile-like jaws. When an unwary insect makes contact with the plant’s open leaves, vibrations from the prey's movements trigger the "jaws" to shut in a tenth of a second. Regulators are similar to Venus flytraps, as they enclose merchants, such as dealers, in an extremely rapid manner, with the victims taken unawares.

Regulators include all federal and state agencies that investigate and sue dealers. “Venus-flytrapping” dealers is one of their key purposes. It’s important to always note that state regulators track the issues that federal regulators prosecute and emulate them on a state level.  Dark Patterns is, once again, another way to sue dealers.

What Are Dark Patterns?

The term “dark patterns” describes design practices that trick or manipulate consumers into making choices they would not otherwise have made and that may cause harm, generally in an electronic world. Dark patterns can possibly violate the unfair and deceptive trade practices acts, or UDAP, the favored prosecuting statute of all government agencies and class-action attorneys. If a practice has the tendency or capacity to mislead a consumer, it can be a violation of UDAP laws. For example, Dark Patterns apply to interfacing electronic media when they deceptively disguise advertising and promotional messages by misleading consumers into believing they are independent, impartial or not from the sponsoring advertiser itself.

The days when dealers advertised in newspapers, television and radio have been substantively replaced with websites, e-mail, electronic internet bots, i.e., robots, ChatGPT, and the host of social media applications, such as Facebook, WhatsApp and Instagram. Each of these media contain the potential for Dark Patterns, and dealers should consider how they are employing these applications.

Dark Pattern Issues

Many of these Dark Pattern issues should be familiar to dealers, but now they emerge in the numerous electronic media in new ways. Here are only a few examples the FTC cites as potential violations and appear in some dealer-consumer interfaces:

  • False low-stock message – stating that inventory is low when it isn’t
  • False high demand – asserting that consumers must purchase immediately by misleadingly saying that there is great demand
  • Limited-time message – offer is good for only a limited time but without a meaningful deadline
  • False discount claims – claiming that there is a discount when it doesn’t exist
  • Preventing price comparisons – The price is so confusing that consumers can’t compare it with others
  • Prechecked boxes – boxes are already checked and can’t be unchecked.
  • Preselection - preselecting a default that’s good for the company but not the consumer, such as a service contract
  • Drip pricing - initially advertising only part of a product’s total price, and then imposing other mandatory charges late in the buying process, such as a dealer preparation fee

There are numerous other examples, such as bait-and-switch, hidden costs, automatically playing videos, hidden information, deceptive consumer testimonials, and many others. These practices may not seem apparently pernicious but may be unlawful.

Conclusion 

Activist government agencies will continue to identify new ways to prosecute dealers. Provident dealers will plan on foiling these prosecutorial efforts by identifying what they should do to comply with these issues. Dealers need to explore these dark shadowed patterns and judiciously clarify their electronic media outreach to the public. 

Terry O’Loughlin is director of compliance for Reynolds & Reynolds and is admitted to the Pennsylvania and Florida Bars. Before joining Reynolds, he was employed by the Florida Office of the Attorney General, where he investigated automobile dealers and financing sources. He previously was a public accountant.  

 

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