Promotional marketing: Gifts v. prizes


INSIGHT
Published
Apr 12th '22
Share
Facebook

The difference between a gift (available to all or many) and a prize (awarded to a few) must always be clear to consumers (see the CAP Advertising Guidance on Promotions with Prizes and Rule 8.19). Ads must not suggest that participants have won a prize if they have not, and must specify the nature and number of gifts and prizes.

 

  • Do not suggest that participants have won a prize if they have not

Code rule 8.19 states that promoters must not claim that participants have won a prize if they have not.  Promoters must not use ambiguous terms of present the opportunity to participate in a promotion in a way which suggests that the recipient has already won. The ASA ruled against a direct mailing for a prize draw which stated “Claim your prize Sweepstakes” on the envelope, and “This is the FINAL NOTIFICATION that will be sent to you regarding your Claim Your Prize Sweepstakes Entry Documents. Don’t miss out!”, in the letter. Although the advertiser explained that the name of the prize draw was ‘claim your prize sweepstakes’, the ASA considered that consumers would interpret the claims to mean that they had won a prize in a sweepstake that could now be claimed (Diabetes Research & Wellness Foundation, 21 March 2018).

 

Promoters are responsible for the administration of their promotions and should ensure that technical issues do not result in unnecessary disappointment. The ASA upheld complaints about a promotion because multiple participants, including the complainant, had received a personally addressed notification email with the subject “Congratulations, you’re our Mastercard competition WINNER”, but had not won the prize. Although the advertiser explained that this was due to a technical issue, because the promoter had claimed that consumers had won a prize when they had not, the ASA considered that they had given consumers justifiable grounds for complaint (The Hut.com Ltd, 02 October 2019).

 

  • Distinguish between gifts and prizes

The distinction between prizes and gifts, or equivalent benefits, must always be clear. Ordinarily, consumers may expect an item which is described as a ‘gift’ to be something which is offered to a significant proportion of participants, and will expect a ‘prize’ to be something which is only available to a small minority of participants.

 

Several factors might help determine what constitutes a “significant proportion”. For example, the relative proportions of potential prize winners and potential gift recipients; the mechanisms by which promoters offer gifts and prizes; and the relative values of the prizes and gifts when compared with each other. There can be no prescriptive definitions of “significant proportion”, and marketers must ensure that the distinction between “gifts” and “prizes” is clear in the context in which the claims appear.

 

If a promotion offers a gift to a significant proportion and a prize to a minority special care is needed to avoid confusing the two. The promotion must, for example, state clearly that consumers “qualify” for the gift but have merely an opportunity to win the prize.

 

Promoters must ensure that the promotion does not mislead by using ambiguous or incorrect terminology. For example, promoters should not claim that respondents can “win” a “reward” because the terminology is inconsistent and confusing: respondents “win” a “prize” but are “allocated”, “awarded” or “given” a “gift” or “reward”.

 

The ASA considered a direct mailing for a prize draw, which included a document in the style of a voucher which stated “£25 FAST CASH … Complete & Return this Prompt Response Entry Form promptly with your other entry materials in the envelope provided for a chance to win in the random drawing!”. They considered that consumers would understand that if they returned the voucher they would receive £25 cash, but that it was not clear from the ad whether this was a gift, prize or equivalent benefit (Diabetes Research & Wellness Foundation, 21 March 2018).

 

Complaints about a direct mailing which implied that a particular customer had been offered a cheque as compensation for an administrative error were also upheld. The letter stated “Specimen Compensation Cheque enclosed!” and “A cheque for up to £12,500!”, along with other references to this amount. The ASA considered that this gave the impression that the recipient would receive a cheque of £12,500 which they would simply be able to cash. In reality, the cheque was a £5 voucher which could be redeemed for a £2 cheque, and participants would be entered into a draw to win £12,500. Because the ad gave the impression that the complainant had been awarded the prize of a cheque for £12,500, and did not make the distinction between the gift of the £2 cheque and the opportunity to participate in a prize draw to win the prize clear, the ad was considered misleading (Plantiflor Ltd, 26 July 2017).

 

Promoters who offer gifts to a significant proportion of participants and the opportunity to participate in a prize draw to win a prize should avoid misleadingly listing prizes and gifts together under one heading. Instead, they should separate them to make it clear that participants will receive an award and have the chance to win a prize.  In 2006, the ASA received a complaint about a mailing stating that Damart customers with “more than 750 Gift Points” had been “officially awarded a magnificent gift from our Audio-Visual Collection” of a DVD home cinema, an audio system, or a widescreen TV. The complainant, who had been allocated 760 ‘gift points’, believed that the mailing misleadingly implied recipients had an equal chance of receiving any of the listed items. The ASA considered that information describing how the items were allocated was not prominent enough and that the audio system, which was a gift, should have been distinguished clearly from the home cinema and TV, which were prizes (Damartex UK Ltd, 17 January 2007).

 

  • Specify the nature and number of gifts and/or prizes

Rule 8.17.6 requires promoters to specify the number and nature of gifts and/or prizes. If the exact number of gifts or prizes cannot be pre-determined, a reasonable estimate of the number and a statement of their nature must be made; for example, it might be acceptable to state “5 Top Prizes and thousands of fun and exciting gifts given away everyday…”. See also Promotional marketing: terms and conditions and Mystery gifts and prizes.

 

  • Free gifts

The ASA generally considers that consumers understand the claim “gift” to be synonymous with the claim “free”.

 

Promoters may make a gift conditional on the purchase of a product, as long as the consumer’s financial obligation is clear, and the gift represents a genuine additional benefit. Promotional items must not be described as “gifts” if that element is included in the package price.

 

The ASA considered that consumers would understand the claims “exclusive gift”, “our biggest gift yet” and “fabulous exclusive gift”, which were used to describe the promotional items that came with a magazine, to mean that that those items were a genuine additional benefit they would receive with the magazine. Because the promotional items were not genuinely separable from the magazines and issues which had gifts of an objectively greater value were sold at a higher price than those with gifts of a lower value, the ASA considered that the promotional item did not offer a genuine additional benefit received as a result of purchasing the magazines and concluded that the claim “gift” was misleading (Practical Publishing Ltd, 4 September 2019).

 

Promoters should be aware that they must not encourage the consumer to make a purchase or series of purchases as a precondition to applying for promotional items, including free gifts, if the number of those items is limited, unless the limitation is made sufficiently clear at each stage for the consumer to accurately assess whether participation is worthwhile (Code rule 8.12). See Promotional marketing: availability.

 

See Use of free.

 

This advice is designed to be read in conjunction with the Promotional marketing section of the CAP Code and the other entries in this advice section, particularly ‘Promotional marketing: Implying consumers are luckier than they are’. Promoters may also wish to seek legal advice before advertising promotions with prizes.

 

Source: Committee of Advertising Practice (CAP)

 

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. CAP’s Advice Online entries provide guidance on interpreting the UK Code of Non-broadcast Advertising and Direct & Promotional Marketing.

 

How can we help!

At LS Consultancy, we provide a cost-effective and timely copy advice and copy development services to make sure all your advertising and campaigns are compliant, clear and suitable for their purpose.

 

We are experts in Marketing and Compliance, and work with a range of firms to assist with improving their documents, processes and systems to help mitigate risk.

 

Contact us today for a chat or send us an email to find out how we can support you in meeting your current and future challenges with confidence.

 

Explore our full range today.

 

Contact us

 

Why Not Download our FREE Brochures! Click here.

 

Call Us Today on 020 8087 2377 or send us an email.

 

You can see our Google reviews here.

 

We’re looking for guest writers with business know-how and experience to create outstanding articles to feature on our website. Sound like you? Then find out more…