Marketing Matters | Review of October 2024

Welcome to this month's edition of Marketing Matters, where we look at advertising and marketing (A&M) trends in the retail and consumer sector.

We will be looking at:

• Some of the key takeaways for A&M departments following October's ASA rulings.
• Other top ASA stories.
• CMA news for the same period.
  
  

ASA rulings – key takeaways for your A&M departments

In October, the ASA handed down 26 rulings, we have highlighted some of the key rulings we think you and your A&M departments should be aware of.

Misleading use of professional standards body logo

A sleep consultancy company featured the Federation of Antenatal Educators' logo, containing the text "FEDANT, Federation of Antenatal Educators" on every webpage of its website. FEDANT administers the national register and professional standards of antenatal educators, breastfeeding counsellors, and doulas in the UK. However, the company in question was not registered with the FEDANT. FEDANT subsequently, raised a complaint with the ASA and challenged the company's use of the logo, noting its use as misleading.

The ASA noted the company's apparent disregard for the Code and considered that consumers would interpret the inclusion of the FEDANT logo to mean that the sleep consultancy company was registered with them. They concluded that the use of the FEDANT logo was misleading and the ad breached CAP Code rules 3.1 (misleading advertising), 3.50 and 3.51 (Endorsements and Testimonials).

Consequently, the ad must not appear again in its current form and the company has been told not to feature the FEDANT logo in future unless they register with them.

Mid-contract price increases

In six separate rulings, which form part of a wider piece of work by the ASA on mid-contract price rises, two UK telecommunications companies have been challenged for the method in which they notified their customers of mid-contract price increases, and four companies were challenged for their failure to clearly identify that their broadband contracts would be subject to mid-contract price increases.

On one company's webpage featured the headline "Get Ultrafast Full Fibre 100 for only £29.99 a month". Smaller text under the main headline read, "Prices rise each year on 31 March by £3.24 in contract". The legal information detailing the increase has been included in a dropdown box at the bottom of the page and was not directly within the listed package details. The company was challenged on whether the presentation of the mid-contract price increase was misleading.

The company believed that the qualifying statement that "prices rise each year on 31 March by £3.24" met the ASA guidelines, because it made clear when the price would increase, by how much it would increase, and immediately followed it with the monthly price and upfront cost information. However, the ASA ruled that this information was not presented with sufficient prominence.

Following the ASA's assessment of the ad it concluded that, whilst the detailed price rise information was presented at the top of the screen, it was included in considerably smaller text than the headline claim, and it was not directly beneath the headline claim. It considered therefore that this placement and size of the text was likely to be overlooked by customers. In addition, the ASA stated that the ad in general did not provide sufficient detail as to how, or by what means, the monthly charge would be affected after the applicable increase.

The ASA held a strikingly similar ruling against the five other telecommunications companies referred to above. Details can be found here under related rulings.  

Online competitions

A home improvements retailer co-hosted a competition to find "a garden lover who could win £5,000 worth of vouchers to transform their outdoor space". The competition was posted using the X platform, encouraging recipients to enter by taking "a picture of [their] entertaining space, and share" using a specified hashtag. However, the retailer was challenged in relation to the competition being misleading due to participants not being provided with sufficient information regarding the criteria and mechanism for judging entries.

The company responded stating that entrants were required to take a picture of their outdoor entertaining space and upload the picture with the specified hashtag. The hashtag was included in the X post which also included a video with more details on how to enter the competition and details of the prize. They also stated that the hashtag suggested and incorporated the messaging that the "best" outdoor entertaining space would be the deciding factor. Judges were said to have been provided guidelines to use when shortlisting and selecting a winner, which included key things to consider, such as the outdoor entertaining space illustrating a set up for hosting guests during the summer and that it should not be limited to outdoor furniture, but also plants, lighting, pains, or gazebos. It was noted that the judges were given a scoring matrix which was based on five key questions.

The ASA understood that, as per the CAP Code, the judging criteria used was a material piece of information that customers were entitled to have prior to entering the competition. It noted that the ad did not provide information on how the competition would be judged and the use of a hashtag specifying "BestHost" was not sufficient to explain to entrant what the judging criteria was. The ASA held that the criteria and conditions of entry were not sufficiently clear and was therefore, misleading.

Takeaways

The key takeaways from the ASA rulings this month are:

• Do not use a professional standards body's logo without being registered with them: Always ensure you re registered with a professional standards body before including their logo on any advertisement or webpage.
• Clarity in relation to mid-contract price increases is key: Take care when placing any mid-contract price rise information. This is especially important with the implementation of the Digital Markets, Competition and Consumers Act this year, which provides further rules around the presentation of pre contract information.  
• Making a competition judging criteria known: If you are hosting a competition, make sure recipients/customers are able to access a clear judging criteria so they can submit the best entry possible.
  

Top ASA stories last month

AI advertising

PLC recently published a practice note on managing the legal risks of AI in advertising, especially generative AI. The benefits of using AI often garner attention (easily produced quirky and unusual images, no need for models or actors, assistance with ideation and presentation drafting) but there are real risks for organisations that use AI in their adverts.

The CAP Code and BCAP Code from the ASA apply to ads using AI. In November 2023, the Institute of Practitioners in Advertising(IPA) and the Incorporated Society of British Advertisers (ISBA) issued twelve guiding principles for the advertising industry in respect of Gen AI. The ICC Code has also been updated to reflect the possible use of AI.

Avoid your ads taking a turn for the worst this Black Friday

Black Friday is one of the biggest consumer events of the year, which only increases the need for marketing teams to ensure that their ads are clear and transparent when it comes to this time of year.

The ASA has reiterated that all savings claims must be genuine, accurate and must not exaggerate any savings that could be made. Sale prices should be set against the most recent price available and when conducting a comparison with 'RRPs', it should be the price at which retailers generally sell those goods on the market. The ASA advises for all price comparisons to be backed up by evidence (i.e. with historic pricing records), the retailer's website alone is not sufficient.

When using 'up to, all and everything' language, the ASA expects a significant proportion of the items included in the sale to be discounted at the top percentage, or bottom price if using 'from £x'. Any suggestion of a promotion being applicable to 'all' or 'everything' but has excluded items is likely to contradict the headline claim and is best avoided otherwise there is a risk of it being considered misleading and a breach of advertising rules.

Promotional offers should also not be extended beyond their closing date, unless there are unavoidable circumstances beyond the retailers' control, and retailers should consider a reasonable estimate of demand, as 'subject to availability' will not always be sufficient.

In other news…

Following the ASA's consolidation of the Advertising Guidance from CAP in June 2023, in its position on misleading environmental claims and social responsibility, greenwashing climate and governance statements in professional service firms is becoming increasingly more high profile.

Due to increasing disclosure and regulation of environmental, social and governance (ESG) credentials/ disclosures and greater attention being paid to an organisations green credentials, statements made about an organisations environmental performance are placed under increasing scrutiny. The legal landscape is developing quickly, with EU regulators in the midst of setting out a policy/framework to provide consistency for national regulators. Additionally, the UK's Financial Conduct Authority (FCA) introduced a new anti-greenwashing rule, which came into effect in May this year. It enables the FCA to challenge organisations authorised by the FCA, if they are considered to be making misleading environmental or social claims.

Data and methodology error, when conducting carbon and climate analysis, are noted as key areas of vulnerability for professional service firms. To effectively manage this growing challenge, firms are encouraged to:

• Implement appropriate risk management, governance, and oversight measures.
• Ensure they have data/evidence to substantiate any statements made.
• Conduct due diligence across its supply chain.
• Consider whether the data and methodology used is verifiable and audited to increase confidence.
• Select any numerical figure to be included in published statements carefully as the consequences to reputation are likely to be significant.
• Have data/statements critically reviewed by and independent party.