Alex is Sprintlaw's co-founder and principal lawyer. Alex previously worked at a top-tier firm as a lawyer specialising in technology and media contracts, and founded a digital agency which he sold in 2015.
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Online marketing is one of the fastest ways to grow a small business in New Zealand. You can launch a campaign in the morning, get leads that afternoon, and have sales rolling in by the weekend.
But there’s a catch: online marketing also creates a long list of quiet legal risks that can sneak up on you. And when something goes wrong (a complaint, a takedown notice, a platform ban, a chargeback wave, or a Commerce Commission issue), it’s usually expensive and time-consuming to fix.
This article breaks down the legal risks of online marketing that NZ business owners should be aware of, and the practical steps you can take to protect your business from day one.
What Counts As Online Marketing (And Why The Legal Risks Creep In)
Online marketing isn’t just “running ads”. For most NZ businesses, it includes a mix of:
- your website copy, product pages, FAQs, and pricing
- online ads (search ads, social ads, display ads)
- email and SMS marketing
- influencer content and affiliate promotions
- reviews, testimonials, and “before and after” images
- competitions, giveaways, referral programs, and discount codes
- cookies, tracking pixels, and audience targeting
The reason online marketing legal risks are so common is that marketing is usually built for speed: you test offers, tweak headlines, repurpose images, and use tools that automate outreach. Legal compliance, on the other hand, rewards careful wording, consent, and accurate record-keeping.
Why “Everyone Does It” Isn’t A Legal Defence
A lot of online marketing trends become “normal” before they become “safe”. For example:
- using a competitor’s name in ad keywords
- copying product descriptions from overseas suppliers
- posting customer photos without clear permission
- running a giveaway without clear rules
- claiming results that aren’t typical (or aren’t backed by evidence)
Even if these are common practices in your industry, your business is still responsible for complying with NZ law (and the platform’s terms). Getting the foundations right early is usually far cheaper than fixing a mess later.
Misleading Claims, Pricing And Reviews: Fair Trading Risks
If there’s one area that creates the biggest day-to-day legal risk in online marketing for NZ businesses, it’s advertising content that could be seen as misleading. In New Zealand, the key law here is the Fair Trading Act 1986.
In plain terms, you need to make sure your marketing is honest, accurate, and not likely to mislead customers (even unintentionally).
Common Risk Areas Under The Fair Trading Act
Misleading conduct can show up in lots of ways online, including:
- Overstated performance claims (e.g. “guaranteed results”, “works for everyone”, “instant cure”, “permanent fix”) when that’s not true or not provable
- Before-and-after marketing that implies typical outcomes when results vary
- “Limited time” urgency that isn’t real (e.g. countdown timers that reset, or fake scarcity)
- Pricing that isn’t clear, such as hidden fees, handling charges, mandatory add-ons, or unclear subscription renewals
- Misleading “was/now” discounts where the “was” price wasn’t genuinely offered for a reasonable period
- Confusing “free trial” offers that roll into paid plans without clear disclosure
Don’t Forget Advertising Standards (ASA)
Alongside the Fair Trading Act, NZ businesses should also be mindful of the Advertising Standards Authority (ASA) and the Advertising Standards Code. The ASA can consider complaints about things like misleading impressions, missing ad disclosures, social proof that creates a false overall impression, or content that’s not clearly identifiable as advertising (including influencer posts). Even where a complaint doesn’t become a Commerce Commission matter, an ASA complaint can still create disruption and reputational harm.
Consumer Guarantees Don’t Disappear Online
If you sell to consumers in NZ, the Consumer Guarantees Act 1993 can apply regardless of whether you sell in-store, through your website, or via social media DMs. That means your marketing and website terms need to line up with what consumer law actually requires (particularly around faulty products, acceptable quality, and remedies).
This is where clear website documentation helps. Many online businesses set expectations using Website Terms And Conditions, but those terms still need to be consistent with NZ consumer law (and not overpromise or misrepresent what customers get).
Testimonials, Reviews And “Social Proof” Can Create Liability
Reviews and testimonials are powerful, but they can create legal risk if they’re not genuine or if they mislead customers. Watch out for:
- editing testimonials in a way that changes their meaning
- publishing testimonials that make big claims you can’t support
- incentivised reviews that aren’t disclosed (e.g. discounts/freebies for reviews)
- posting reviews that you wrote yourself (or had your team write)
A good rule of thumb: if a reasonable customer could rely on the statement to make a buying decision, treat it as advertising and make sure it’s accurate.
Disclaimers Help, But They Don’t Fix Everything
Disclaimers can be useful (for example, explaining assumptions, limitations, or that results may vary), but they’re not a magic wand. If the main message is misleading, a small disclaimer tucked away at the bottom usually won’t fix the overall impression.
It’s still worth getting the right disclaimer language in place where it fits your offer, particularly for high-risk industries (health, wellness, financial services, education, and “results-based” services). Many businesses also use targeted Disclaimers on landing pages, blog posts, and lead magnets to reduce misunderstandings and set expectations.
Privacy, Cookies And Direct Marketing: Using Customer Data Lawfully
Modern online marketing runs on data: emails, phone numbers, website behaviour, retargeting audiences, and customer purchase history.
That’s why privacy compliance is one of the most important online marketing legal risks for NZ businesses. The core law here is the Privacy Act 2020.
What You Need To Get Right Under The Privacy Act 2020
Exactly what you need will depend on your business model, but common compliance gaps include:
- collecting more personal information than you actually need
- not clearly explaining why you’re collecting it
- using data for a new purpose customers wouldn’t expect (without a lawful basis/appropriate notice)
- sharing customer lists with third parties without clear disclosure
- weak security practices (leading to a data breach)
If you collect personal information via your website (contact forms, quote requests, accounts, newsletter signups, purchases), having a clear Privacy Policy is a practical baseline. It helps you explain what you collect, how you use it, who you disclose it to, and how customers can request access or correction.
Cookies And Tracking: Be Transparent
Many businesses use analytics tools, tracking pixels, and advertising cookies to measure campaigns and run retargeting ads. In NZ there isn’t a single “cookie law” in the way some overseas jurisdictions have, but cookies and tracking can still raise Privacy Act issues where the data is personal information (or can become personal information when combined with other data) and where people aren’t told what’s happening.
At a minimum, you should know:
- what tracking tools you use
- what data they collect
- who receives that data (including overseas service providers)
- how to explain this clearly to customers
This isn’t just a legal issue - it’s also a trust issue. Customers are increasingly privacy-aware, and transparency reduces complaints. (And if you market to customers overseas, you may also need to consider the cookie/consent rules that apply in those jurisdictions.)
Email And SMS Marketing: Consent Matters
Direct marketing is a classic growth channel, but it’s also where businesses can accidentally breach anti-spam rules. In NZ, the Unsolicited Electronic Messages Act 2007 sets rules around sending commercial electronic messages (like marketing emails and texts).
Key practical points include:
- make sure you have the right type of consent (express or inferred, depending on the situation) and keep sensible records of how it was obtained
- clearly identify your business in the message
- include an unsubscribe option that actually works
- honour unsubscribe requests promptly
If email is part of your marketing mix, it’s worth tightening up your processes early (especially if you’re importing lists, running lead magnets, or relying on automated sequences). Many businesses sanity-check their approach against the common pitfalls set out in Email Marketing Laws.
Intellectual Property And Content: Photos, Music, Memes And Brand Use
Online marketing needs content - and content often belongs to someone.
Using the wrong image, video, or phrase can expose you to takedown notices, account restrictions, demands for payment, or legal claims. These are very real online marketing legal risks, particularly if you’re moving fast and outsourcing content creation.
Copyright Risks (Photos, Videos, Music, Copy)
Copyright can apply to things like:
- photographs and product images
- videos, reels, and graphics
- music used in ads or videos
- written content (blogs, web copy, course materials)
Common risk scenarios include:
- using images found on search engines (even if they’re “everywhere” online)
- receiving “supplier images” without confirming your licence to use them
- reposting a creator’s content without permission
- paying a freelancer without a clear agreement about who owns the deliverables
If you’re working with contractors (designers, photographers, videographers, marketing agencies), it’s worth ensuring the contract clearly covers ownership and licensing of IP created for your business.
Trade Marks And “Competitor Comparisons”
Another common marketing tactic is comparing your product to a competitor, referencing other businesses in blog posts, or bidding on keywords associated with a rival brand.
This can become risky when it crosses into:
- trade mark infringement (for example, using a competitor’s brand in a way that indicates trade origin or causes confusion)
- misleading conduct (e.g. suggesting an affiliation or endorsement)
- passing off (where customers could be misled into thinking you’re connected)
In practice, competitor keyword bidding and comparisons can be more nuanced than a simple “allowed/not allowed” rule, and outcomes often depend on the overall impression created by the ad and landing page. If you’re unsure whether your campaign crosses the line, it’s better to check before you spend money promoting it. Even a quick review can help you avoid headaches like takedowns and disputes connected to Trademark Infringement.
User-Generated Content: Don’t Assume It’s Free To Use
Customer photos and tagged posts are great marketing assets, but you should still think about permission. If you want to reuse customer content in ads, on your website, or in promotional emails, consider:
- getting clear written permission (especially for paid ads)
- being careful if the image includes children or other identifiable people
- avoiding sharing content that reveals sensitive information
This is also where your privacy compliance overlaps with your marketing strategy. Clear processes reduce the chance of complaints and reputational damage.
Contracts And Platform Rules: Working With Agencies, Influencers And Affiliates
Some of the biggest online marketing legal risks don’t come from what you post - they come from who you work with.
Marketing relationships often move quickly: you agree to a “trial month”, approve content in DMs, and pay invoices as you go. Without the right paperwork, you can end up stuck in unclear deliverables, IP disputes, or campaigns that breach platform rules (with your business taking the hit).
Influencer Marketing: You’re Still Responsible For The Advertising Message
Even if an influencer creates and posts the content, your business can still face consequences if the advertising is misleading or not properly disclosed.
A solid Influencer Agreement can help set clear expectations around:
- content approval rights (before posting)
- required disclosures (so it’s clearly an ad where needed)
- what claims can and can’t be made
- who owns the content after the campaign
- what happens if content is taken down or causes complaints
This is one of those areas where “just keeping it casual” often backfires. Clear terms protect both sides and make the relationship smoother.
Agencies And Freelancers: Define Deliverables, Ownership And Liability
If you’re hiring a marketing agency or freelancer, you’ll want to clarify:
- what exactly is being delivered (ad creative, landing pages, email sequences, reporting)
- timeframes, budgets, and who approves spend
- who owns campaign assets, copy, and data
- confidentiality (your pricing, strategy, customer lists)
- what happens if things go wrong (for example, a platform ban or policy breach)
It’s also worth being careful about “performance guarantees”. If someone promises a specific ROI or number of leads, make sure the contract clearly explains the assumptions and limits, so you’re not paying for something that was never realistic.
Competitions And Giveaways: Rules Protect You (Not Just Participants)
Competitions are great for reach, but they can quickly become messy if you don’t set clear rules. Common issues include disputes about eligibility, prize delivery, timing, or claims that the giveaway wasn’t run fairly.
Having proper Competition Terms And Conditions helps you set the ground rules upfront, including:
- who can enter (age, location, employee exclusions)
- start/end dates and how the winner is chosen
- prize conditions (including substitution rights if necessary)
- how you’ll notify winners and timeframes to claim
- how you’ll handle personal information collected
This is a simple step that can dramatically reduce the risk of complaints and platform issues.
Your Website Is Part Of Your Marketing (So It Needs Legal Settings Too)
Your ads might be the “front door”, but your website is where customers decide whether to trust you.
From a legal risk perspective, your website should match your marketing promises and clearly set expectations around things like:
- pricing, shipping timeframes, and returns
- subscription renewals and cancellations
- how customers contact you (and when you respond)
- what happens if products are out of stock or delayed
For many small businesses, having tailored Website Terms And Conditions is a practical way to reduce misunderstandings and disputes as you scale your campaigns.
Key Takeaways
- The biggest online marketing legal risks in NZ often come from everyday actions: claims in ads, pricing displays, reviews, email campaigns, and reused content.
- The Fair Trading Act 1986 is a major risk area for marketing content - make sure your claims are accurate, not exaggerated, and supported by evidence where needed.
- The ASA’s Advertising Standards Code also matters in practice, especially for influencer disclosures and the overall impression created by your ads.
- Online sales still need to align with the Consumer Guarantees Act 1993, so your marketing promises and website terms should be consistent with consumer law.
- The Privacy Act 2020 affects how you collect and use customer data (including leads and analytics), and having a clear Privacy Policy helps you communicate what you’re doing.
- Email and SMS campaigns should comply with the Unsolicited Electronic Messages Act 2007, including valid consent and a working unsubscribe process.
- Copyright and trade mark issues can arise quickly in online content - avoid using images, music, or brand references unless you’re confident you have permission and you’re not misleading customers.
- Strong marketing contracts (for agencies, freelancers, and influencers) reduce risk by clarifying deliverables, approvals, ownership of content, and what happens if a campaign causes complaints or takedowns.
If you’d like help reducing the legal risks in your online marketing (without slowing your growth), you can reach us at 0800 002 184 or team@sprintlaw.co.nz for a free, no-obligations chat.
