Guarantees and warranties

Jul 16th '14

The word “guarantee” should not be used in a way that could confuse consumers about their legal rights but may be used colloquially provided the meaning is clear.


Marketers should distinguish between offering a guarantee and making a claim that, for example, a certain level of performance is guaranteed. And marketers who cannot “guarantee” certain results should be careful not to imply they can. For example, the Advertising Standards Authority (ASA) has taken a dim view of marcoms that imply slimmers are guaranteed to lose weight (Claire Hegarty, 15 May 2013) or learner drivers are guaranteed to pass their test (Kan Kan Ltd, 8 January 2014).


Significant limitations to guarantees should be clearly stated

Marketing communications must make clear each significant limitation to an advertised guarantee (of the type that has implications for a consumer’s rights). For example, if a warranty covers parts but not labour, marketers should make that clear. Similarly, if the guarantee applies only in certain circumstances or consumers have to fulfill certain criteria to validate their guarantee, that should be clear too. Marketers must supply the full terms before the consumer is committed to taking up the guarantee (Rule 3.54). In 2014 the ASA ruled that a claim to offer an “Insurance Backed Guarantee” for a driveway was misleading because it did not make clear that it did not cover cracking, a significant issue associated with concrete driveways (Town & Country Driveways Ltd, 2 April 2014).


Be aware of consumers’ rights and relevant legislation

If advertisers offer a money-back guarantee, the Committee of Advertising Practice (CAP) Code requires marketers must promptly refund consumers who make valid claims (Rule 3.55).


Marketers might want to seek legal advice because legislation could apply, for example, The Supply of Extended Warranties on Domestic Electrical Goods Order 2005. Section 4 details the obligation on marketers to advertise the price of an extended warranty on domestic electrical appliances in newspaper advertisements and other printed publicity in certain circumstances.


Remember the difference between “lowest price guarantees” and “lowest price guaranteed”

Many marketers offer “lowest price guarantees” whereby they offer to beat or match competitors’ prices. The principles are similar: the claim should not mislead, significant conditions should be clear from the outset and the full terms of the guarantee should be available before purchase. The ASA has investigated those types of ‘guarantee’ many times. Marketers often confuse the claim “lowest price guaranteed” (where they do extensive monitoring and lower their prices in response to market movements) with the claim to offer a “lowest price guarantee” (where they will act if the consumer finds a price lower than theirs). See ‘‘Lowest price claims and promises’ for further advice on such claims.


Other typical pitfalls include the failure to include key information. In 2014, the ASA upheld a complaint against a “price beat offer” for a TV. Because the advertiser did not make sufficiently clear that to be eligible the alternative TV had to include a comparable 5 year warranty (included for free with the advertisers’ product) the ASA concluded that the ad was misleading (Richer Sounds plc, 30 April 2014 ).


Source: CAP


Read: Five tips guaranteed to get your guarantees on the right track


Note: This advice is given by the CAP Executive about non-broadcast advertising. It does not constitute legal advice. It does not bind CAP, CAP advisory panels or the ASA.


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