Prices: General


INSIGHT
Published
Nov 9th '22
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The Advertising Standards Authority (ASA) regularly upholds complaints about marketing communications that feature a product that costs more than the stated price. Price statements must relate to the product featured in the ad and should not mislead by omission, undue emphasis or distortion. Price statements include statements about the manner in which the price will be calculated as well as definite prices.

 

Price statements in marketing communications should take into account the Chartered Trading Standards Institute’s Guidance For Traders on Pricing Practices.

 

  • Ensure prices match the product shown

 

Advertising rules state “Price statements must not mislead by omission, undue emphasis or distortion. They must relate to the product featured in the marketing communication.” If ads feature products and their prices, the price must relate to the product.

 

An ad for a price promotion on a clothing website was considered misleading because the price statement in the ad did not relate to the item of clothing which was shown (I Saw it First Ltd, 10 March 2021)

 

Marketers should not feature a picture of a top-of-the-range or enhanced product and quote in the headline a price for a lower specification model. For example, in 2014 the ASA upheld a complaint that a car ad was misleading because the models featured were shown with metallic paint and alloy wheels, which were not included in the price shown (BMW UK Ltd, 5 March 2014).

 

  • Include non-optional taxes, duties, fees and charges

Advertising rules state that quoted prices must include non-optional taxes, duties, fees and charges that apply to all or most buyers.

 

If it is not possible to calculate the charge in advance, for example because it depends on the consumer’s circumstances, the advertisement must make clear that the charge is excluded from the advertised price and state how it will be calculated.

 

The ASA ruled against an ad for a rental car company, because the quoted price did not include the non-optional car company hire fee (Rentalcars.com, 13 March 2019).

 

For detailed guidance on these rules please see Compulsory costs and charges: general.

 

  • Clearly state any commitment the consumer must make to obtain the price

If the price of one product depends on another, marketing communications must make clear the extent of the commitment the consumer must make to obtain the advertised price (Rule 3.21). For example, a promoter offering a tie for £1 when customers buy a shirt for £20 cannot have an unqualified claim of “buy a tie for £1”. Such a promotion would need to be clarified immediately and prominently to explain customers’ financial obligation; for example, the promoter could claim “Get a tie for £1 when you spend £20 on selected shirts” or “Shirt and Tie offer – £21”.

 

  • Do not use “from” and “up to” to exaggerate the availability of a product at a given price

Advertising rules state that price claims such as “up to” and “from” must not exaggerate the availability or amount of benefits likely to be obtained by the consumer.

 

When assessing “up to” and “from” saving claims the ASA are likely to have regard to the CTSI Guidance For Traders on Pricing Practices. This new guidance states that, when using “from” or “up to” to advertise a saving, advertisers must ensure that a significant proportion of sale items are discounted at the maximum saving, and that these claims represent the true overall picture of the price promotion.

 

What is considered a “significant proportion” may depend on individual factors in each case and the ASA will consider this on a case-by-case basis. Historically, the ASA have considered that less than 10% is unlikely to be considered a significant proportion. An ad for a January sale which stated “up to 70% off plus a further 10% off” was upheld by the ASA because the number of sale items which were discounted by 70% before the additional 10% discount was 8.63%, which was not considered a significant proportion (Better Bathrooms UK Ltd, 4 October 2017). See also Kiddies Kingdom Ltd, 13 October 2021.

 

When assessing whether an “up to” or “from” claim represents the true overall picture of a sale, the ASA is likely to expect the sale items with the maximum saving to be distributed across different price ranges. Even if a significant proportion of sales items have the maximum saving, if these sale items are disproportionately in the lower price ranges, an “up to” or “from” claim is still likely to mislead (Better Bathrooms UK Ltd, 4 October 2017). For further guidance see ‘Promotional savings claims’.

 

  • Price comparisons

Advertising rules state that marketing communications that include a price comparison must make the basis of the comparison clear. For example, whilst marketers may legitimately make price comparisons between branded and non-branded products, the basis of the comparison must be clear. The ASA upheld complaints about an ad which compared the cost of products in two supermarkets because the ad did not make clear that the prices compared were non-branded products from one supermarket, and branded products sold by the other (Lidl Northern Ireland GmbH, 14 August 2019).

 

CAP has published Advertising Guidance on Retailers’ Price Comparisons and on Lowest Price Claims and Price Promises.

 

Price comparisons must not mislead by falsely claiming a price advantage. Comparisons with a recommended retail prices (RRPs) are likely to mislead if the RRP differs significantly from the price at which the product or service is generally sold (Code rule 3.40). For further information see ‘Prices: recommended retail prices (RRPs)’ and ‘Promotional savings claims’.

 

  • Be aware of sector guidance

Marketers might also want to refer to the CTSI Guidance For Traders on Pricing Practices.

 

Source: 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 AdviceOnline entries provide guidance on interpreting the UK Code of Non-broadcast Advertising and Direct & Promotional Marketing.

 

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