What is Bait and Switch?

Bait and switch is a sales tactic that tricks consumers into buying something other than an advertised item.

How Does Bait and Switch Work?

John Doe sees an ad in the paper for $1 orange juice at a local retailer. He goes to the store and finds out that the juice is not in stock and that the retailer is only offering a competitor's brand for $4.

If the retailer has intentionally run the ad without having the item in stock, this is bait and switch. The idea behind the tactic is to do whatever it takes to get people into the store. In our example, the $1 orange juice is the bait. The switch occurs when a salesperson, or in this case, the grocery store shelf, informs the customer that the advertised item is not available but a similar one is available at a higher price.

Why Does Bait and Switch Matter?

Bait and switch tactics are illegal in the United States, but they are used in virtually every industry. Consumers should read the fine print in advertisements and alert local authorities to infringements in sales laws.

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Paul Tracy
Paul Tracy

Paul has been a respected figure in the financial markets for more than two decades. Prior to starting InvestingAnswers, Paul founded and managed one of the most influential investment research firms in America, with more than 3 million monthly readers.

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