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The ASA has issued another ruling regarding countdown timers and pricing claims - both issues which are being heavily scruitnused by the ASA and the CMA at the moment. The ruling is also notable for the fact that it followed a complaint by a competitor, which is quite rare these days. The ruling is a timely reminder for legal and marketing teams alike of the importance of clarity, substantiation, and verifiability in advertising claims.
Background
The complaints were made about:
- A banner ad which stated: "Up to 40%
off selected finishes + an extra 5% offer ends
in..."
This was accompanied by a countdown timer. - A webpage titled "Why choose Hammonds?", which included the claims: "We won't be beaten on quality and price" and "We can offer you better quality furniture at a price others can't beat."
Sharps challenged the ads on three grounds:
- That the countdown timer was misleading.
- That the comparative claims were unsubstantiated.
- That the comparative claims were unverifiable.
The ASA's findings
- Misleading countdown timer - The ASA found that the countdown timer created a false sense of urgency. While the "extra 5%" offer did expire on the stated date, the "up to 40% off" promotion continued for another week. The ASA said that the ad implied both offers were expiring simultaneously, thereby exerting undue pressure on consumers to make a purchase decision. This was misleading under the CAP Code.
- Unsubstantiated comparative claims - Hammonds argued that the claims about quality and price referred to their price match promise. However, the ASA noted that the ad did not mention this promise or provide a link to further details. The evidence provided (limited competitor checks and internal spreadsheets) was insufficient to substantiate such broad claims. The ASA emphasised that advertisers must hold robust evidence before making comparative statements.
- Unverifiable claims - The ASA also found that the claims were unverifiable. Consumers had no means of checking how comparisons were made. Hammonds admitted that direct price comparisons were difficult due to the bespoke nature of their services because they had to contact competitors for a quote. This lack of transparency rendered the claims unverifiable, breaching the CAP Code's requirement that comparative claims must be verifiable.
The ASA told Hammonds to ensure that their future advertising did not misleadingly imply that discount offers were time-limited, for example by using a countdown clock, if that was not the case. It also told them not to make comparative claims with identifiable competitors unless they held adequate substantiation for those claims, and to ensure such claims were verifiable.
So what?
This ruling highlights several key legal considerations for advertisers:
- Transparency in promotions: Countdown timers and promotional deadlines must accurately reflect the scope and timing of offers. Misleading urgency can breach the Digital Markets, Competition and Consumers Act 2024, as well as the advertising codes.
- Substantiation of claims: Comparative claims must be backed by objective, comprehensive, and up-to-date evidence. Internal data alone may not suffice, especially if it lacks breadth or independence.
- Verifiability: Consumers must be able to verify comparative claims. This typically requires clear criteria, accessible methodologies, and references to supporting data.
- Price match promises: If you rely on a price match policy to justify advertising claims, you must clearly reference it in the ad and support it with transparent terms and conditions.
Conclusion
You need to ensure that all claims, particularly those involving discounts, comparisons, or urgency, are clear, substantiated, and verifiable. Failure to do so not only risks reputational damage but may also result in the enhanced regulatory sanctions under the DMCC Act and the withdrawal of non-compliant ads.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.