Honda’s “Advertising Police” is After its Dealers

Published: Aug 12, 2014
Honda
For a number of reasons 2014 doesn’t seem the be the most favorable to franchised Honda dealers. Sales are slower compared to those of other automakers, new vehicle launches are scarce, and the brand’s pickup line is aging.

Now there’s a new issue, officially called Honda Compliance Headquarters or as Honda dealers call it – the “advertising police”. The automaker has created this extension to its marketing department to keep “a close watch on the marketing activities of dealers who participate in the brand’s dealer marketing allowance program and cracks down on any who violate strict rules on what dealers can and can’t say in their advertising, whether print, online or broadcast.”

Both the restrictions and the fines that follow their violation seem excessive to Honda’s dealers. For example, advertising a car below its invoice price can cost a dealer up to $400 per vehicle, even though selling the car below that price is actually allowed.

While most dealers agree these measures protect the brand, some are saying that it limits their ability to compete.

Read the full article in Automotive News.

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Victor Lance is the founder and president of Lance Surety Bond Associates, Inc. He began his career as an officer in the U.S. Marine Corps, serving two combat tours. As president of Lance Surety, he now focuses on educating and assisting small businesses throughout the country with various license and bond requirements. Victor graduated from Villanova University with a degree in Business Administration and holds a Masters in Business Administration (MBA) from the University of Michigan's Ross School of Business.