Most shoppers want to get a good deal, and a lower price or temporary promotional price, is often an effective way to attract customers. In order to maintain consumer confidence it’s important that they’re able to trust the prices they see, and for them to have faith that a promotional price represents a genuinely good deal. In the interests of promoting clear and transparent pricing practices in ads, both for the benefit of consumers and to maintain a level playing field for advertisers, the UK Code of Non-broadcast Advertising, Sales Promotion and Direct Marketing (the CAP Code) requires that prices must not mislead by omission, undue emphasis or distortion.

The ASA recently adjudicated on a promotional price for beer offered by Tesco supermarkets. The product had been priced at £4.99 from 2 October 2013 until 22 October 2013, a total of 21 days, in all Tesco UK stores. The ad stated "Hobgoblin 4x440ml Can ... SAVE 49p Was £4.99 Now £4.50 valid from 23/10/2013 until 12/11/2013" and therefore appeared to be a promotion where Hobgoblin was available for 49 pence less than normal between the specified dates. A member of the public complained that the product had not been available at the higher price for a reasonable amount of time and that the product remained available at the lower price after the promotional period had ended.

In its consideration of the complaint about the establishment of the £4.99 price point the ASA noted that the product had been on sale at £4.99 for 21 days immediately before the promotion, but that it had been available at £4 for at least two months prior to that. Given the product had been available at £4 for at least two of the three months leading up to the promotion, and for at least twice as long as it had been available at the higher price referenced in the ad, it was reasonable to assume that £4 was the normal selling price. As the ad implied that £4.99 was the normal selling price of the product, the ASA concluded that the ad was likely to mislead by claiming that consumers could make a greater saving than was in fact the case.

The learning from this is that promotional prices should always be based on a products normal selling price, and not on a temporarily increased price that has the potential to mislead a consumer as to the actual savings they can make. The adjudication also highlights the fact that the ASA will take a common-sense approach to determining the normal price at which a product is sold.

The second point of complaint related to the fact that the product continued to be available at the promotional price after the end of the promotion. The ASA noted the dates referred to in the ad and considered that a consumer would interpret the statement “Now £4.50 valid from 23/10/2013 until 12/11/2013” to mean they could buy the product at the reduced price of £4.50 until the 12th of November. As the product remained at £4.50 until the 3rd of December the ASA concluded, despite the fact that the product was available at the cheaper price due to a price reduction rather than the promotional period being extended, that the inclusion of a closing date that was subsequently incorrect was likely to mislead. Whilst the ASA acknowledges that some products are commonly subject to dynamic pricing their decision recognises the importance for consumers of being able to make an informed choice based on clear product pricing promotions in ads. Advertisers should seriously consider whether temporary price promotions are suitable for products whose price is likely to change during the promotional period, as the promotion is likely to be deemed misleading if the price that is the basis for a savings claim changes partway through the promotion.

Whilst the ASA is aware that there is currently a review taking place into the Department for Business, Innovation and Skills Pricing Practices Guide and that this may impact on pricing practices in the future, the need to ensure clarity of pricing for consumers is highly likely to remain a prominent feature, and this adjudication demonstrates again the ASA’s commitment to ensuring advertising is genuine and meaningful for consumers.

The Tesco ruling can be read here.

Please contact the CAP Copy Advice team if you have any queries.

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