At this time of year advertisers want to make the most of the surge in online spending and a common way to entice customers is to offer a trial of their products or services for free. However, two recent adjudications by the Advertising Standards Authority (“the ASA”) highlight, once again, that marketers must be ever vigilant about their use of the word “free” in their marketing communications.
On 28 November 2012 the ASA upheld a complaint against Amazon relating to its use of the word “Free” in a marketing campaign for its Amazon Prime service. Amazon’s claim on its website stated “Get your stuff fast. Unlimited FREE One-Day delivery on all eligible orders”. “Try Amazon Prime FREE for one month: Unlimited Free One-Day Delivery…After your free trial, Amazon Prime is just £49 per year”.
Marketing communications in the UK must comply with the Advertising Codes (“the Codes”) as written and maintained by the Committee of Advertising Practice (“CAP”) and administered by the ASA. In this case the ASA received a complaint challenging whether the description of the one-day delivery as “free” was misleading.
Amazon claimed that they did not believe the claim breached the Codes because it did not contain any false information – the cost of the Prime membership was clearly shown as being £49 and there was no extra cost for the use of the one day delivery. Rule 3.25 of the Codes states that:“Marketers must not describe an element of a package as “free” if that element is included in the package price unless consumers are likely to regard it as an additional benefit because it has recently been added to the package without increasing its price”.
The ASA upheld the complaint on the basis that Prime was a paid-for service which cost £49 per year and as part of that service members could take advantage of one day delivery at no extra cost. Because members had to pay £49 before they could use the service the ASA considered the use of the word “free” to be misleading and ordered Amazon not to describe Prime one-day delivery as free.
A clearer breach of the Codes and a demonstration of the dim view that the ASA takes of advertisers who do not respond to the ASA’s enquiries regarding a complaint comes in the recent adjudication on Beverly Hills Editions t/a www.yourdailyoffers.co.uk.
Here, an email advertisement from www.yourdailyoffers.co.uk offered a free sample of Tropicleanse All-Natural Colon Cleanser. Large text stated “GET YOUR FREE SAMPLE NOW” and smaller text underneath stated “Just pay postage & packaging”.
The ad did not make clear that customers would subsequently be charged for the product on a monthly basis. The complaint was upheld because offers must not be described as free if a customer has to pay packing charges and also ads must make clear the extent of the commitment that customers must make in order to take advantage of a free offer and such qualifications must be made clear in the ad. The ASA took a dim view of the advertiser’s failure to respond to their enquiries which in itself is a breach of the Codes.
Whilst the ASA’s focus is on bringing about compliance with the Codes rather than punishing advertisers there are consequences of non-compliance and in fact the risk of bad publicity is enough for most advertisers to want to ensure compliance. In the case of non-broadcast ads CAP may issue alerts to the media advising them to withhold advertising space in relation to non-compliant advertising. Persistent offenders can be required to have all their advertisements pre-vetted for compliance and misleading or unfair advertising can be referred to the Office of Fair Trading for legal proceedings. In addition, the ASA now publishes a list of advertisers who continue to make claims on their websites that do not comply with the Codes. These remain in place until they amend their marketing in line with the Codes. Finally, advertisements that are non-compliant are disqualified from industry awards which denies advertisers and agencies that created the ad the opportunity to showcase their work.
For advice relating to your marketing and advertising activities please contact Sharon Playford.