When Heather Miceli went online to redeem $100 worth of L.L. Bean coupons, she Googled the company name to find its official website, and a paid search ad caught her eye: "L.L. Bean (official site): get a $250 gift card." She clicked on it and was taken to Llbgiftcard.com, which read that if she took a survey, she would receive a free $250 gift card.
Ms. Miceli, who lives on Cape Cod, Mass., was lured in by an online lead-generation offer, part of a $1 billion industry. Llbgiftcard.com calls itself an "independent rewards program not affiliated with any of the listed products or retailers," and it makes money by generating leads for its sponsors. It's unclear whether Ms. Miceli ever would have gotten the proffered $250 L.L. Bean gift card, but what is clear is the offer wasn't actually "free" at all.
Paying for free
On Llbgiftcard.com, Ms. Miceli navigated through pages of survey questions and magazine-subscription offers and eventually learned she had to shell out money to get her gift card. The offer she chose was to buy a $20 coupon book from Yourfreegiftcard.com.
Nearly a week later, she hadn't received the gift card and sent an e-mail to Freeport, Maine-based L.L. Bean. A customer-service representative said L.L. Bean was being deluged with calls and e-mails from customers voicing similar concerns, and authorities were working on the problem.
Even though the fine print of the Llbgiftcard.com offer states it has no association with retailers such as L.L. Bean, the domain name shows it hopes consumers do in fact associate it with the retailer -- and that can be damaging to a hard-earned brand, said Jason Malo, senior manager of brand-protection services at Verisign. "Any kind of trusted brand is a potential target for them. ... The goodwill and trust that the company has built under that brand is what ensures that somebody will fill out the survey."
A spokeswoman for L.L. Bean said she couldn't speak about that story specifically but added: "We do understand that we need to protect our customers. It is difficult, but we try to make sure that occurrences like this happen at a minimum."
"To prove trademark infringement you have to prove likelihood of confusion arising from the use of the mark as to source, sponsorship or affiliation," said Mitch Stabbe, head of trademark practice at Washington law firm Dow Lohnes.
At its best, online lead generation can be useful for helping companies acquire highly qualified customers. But at its worst, rogue players tarnish the names of legitimate ones.
At the very least, the tactic used to lure Ms. Miceli was misleading; it was a search ad claiming to be the official L.L. Bean site, when in fact it was not affiliated with the brand. Google tries to confirm the veracity of every website associated with a paid search ad but acknowledged that there is a small window of time in which a false offer might appear.
The Interactive Advertising Bureau a month ago issued industry-written guidelines for best practices in lead generation, and the Federal Trade Commission has said free offers must be made "with extreme care so as to avoid any possibility that consumers will be misled or deceived." Joe Rosenbaum, partner at law firm Reed Smith, said in this case it sounds like L.L. Bean "could have recourse if they can find them."
Two weeks ago Verisign's Mr. Malo said LLBGiftCard.com was registered to KZ Group, but found as of March 2, it no longer was. Ad Age's attempts to locate contact information for the site were unsuccessful.
His advice for marketers: "Be aware of the problem and understand how your brand may be misused on the internet. Listen to your customers and make sure they have a conduit into you to report any issues, and also go out proactively look for brand abuses."