ASA Adjudication on BrandAlley UK Ltd
BrandAlley UK Ltd
3 Thomas More Square
10 October 2012
Internet (sales promotion)
Number of complaints:
A website for cosmetics, www.brandalley.co.uk, featured a number of Elemis products at discounted prices. Claims beneath a gift set product stated "Stars of Spa 300/50/400/75ml Elemis £49.50 RRP £89.00 (-44%)". Claims beneath a perfume stated "Elemis Fragrance Duo 2 x 28 ml Elemis £45.00 RRP £71.60 (-37%)".
The complainant challenged whether the savings claims were misleading and could be substantiated.
CAP Code (Edition 12)
BrandAlley UK Ltd (BrandAlley) said they based the specified savings claims in good faith on actual product value information obtained expressly in writing from Elemis, the manufacturer of the products. They provided an e-mail from Elemis highlighting the particular products mentioned in the complaint. They said they required manufacturers to ensure such information was accurate.
BrandAlley said they appreciated that the ASA had to apply CAP Code (Edition 12) rule 3.40 which stated that comparisons with recommended retail prices (RRPs) were likely to mislead if the RRP differed from the price at which the product was generally sold. They believed, however, that it presented serious issues for them and for other retailers, particularly in the light of the discounting practices operated by the large online retailers. BrandAlley argued that the natural meaning of an RRP, and the one that would be understood by consumers, was literally that the price had been recommended by the manufacturer, who was the official source of the product and was a single and reliable point from which this information should emanate. They did not believe that consumers would understand an RRP to mean that the product was generally sold at that price.
BrandAlley argued that it was not reasonable to require individual re-sellers to make their own assessment of the relevant marketplace and work out what the generally sold price was. They argued that requiring individual re-sellers to assess and state the RRP was clearly not appropriate and not what happened in practice. They questioned how a retailer was expected to obtain accurately that information other than by carrying out a market survey or by using sales data from competing retailers. The results of any such analysis would vary greatly and be open to huge subjective interpretation, which would be more likely to cause confusion to consumers who would see lots of different, conflicting RRPs and generally sold values. Additionally, if large online retailers deeply discounted an RRP, that would very likely skew the generally sold price on the relevant market. It might also render such retailers able to create generally sold prices, against which smaller competitors could not compete or make savings claims against. They reasserted that, in that light, it seemed most appropriate for the relevant manufacturer to set the RRP for the particular product and for all individual re-sellers to work from this one price point, in the interests of certainty, fairness, and established practice.
BrandAlley acknowledged that there had been previous ASA decisions which followed CAP code (Edition 12) rule 3.40 to the letter, but also understood that the ASA Council was not bound by its previous decisions and proposed that, in this case, BrandAlley's actions were correct. They said this was the only such complaint about them in the past ten years.
The ASA noted BrandAlley had provided an e-mail which showed that Elemis regarded the products as being worth the RRPs stated in the ad. However, we considered that a manufacturer's opinion on the value of their product was not necessarily reflective of what retailers would actually sell it for. Although we noted BrandAlley's argument that RRPs were literally recommended prices, we considered that consumers would still expect that such prices would be reflective of an actual general market price.
We therefore considered that the e-mail provided by BrandAlley did not demonstrate that the products had been generally sold, or were sold at all, at those prices and we considered that those prices were therefore notional. We considered that using notional prices as the basis for savings claims was likely to mislead consumers by implying that BrandAlley were offering the product for less than customers would typically pay elsewhere and that customers would therefore make a saving by buying from BrandAlley, when that was not demonstrably the case.
We considered that BrandAlley should have been able to demonstrate that the advertised products were generally sold at the RRPs stated, for example with robust, recent market data. Because we had not seen evidence that they were, we considered that the RRPs were unsubstantiated and concluded that the savings claims were misleading.
The claims breached CAP Code (Edition 12) rules 3.1 (Misleading advertising), 3.7 (Substantiation) and 3.40 (Price comparisons).
The claims must not appear again in their current form. We told BrandAlley not to state RRPs, or base savings claims on them, unless they held substantiation that the product was generally sold at that price.