News Item
ASA rules on fluctuating prices in advertising
3 March 2010
The advertising watchdog, the Advertising Standards Authority (ASA), has recently issued a decision which will impact on the way in which online retailers publish printed advertising materials bearing their prices.
The decision related to a direct mail brochure circulated by dabs.com plc, an online retailer of electronic and computer equipment. A member of the public challenged whether one of the products advertised in the brochure was in fact available at the price shown in the brochure.
Dabs.com plc claimed that due to an error VAT had not been included within the price of one of the products shown in the brochure, but that since the brochure expressly stated that customers should “check www.dabs.com for latest prices” the error should not have misled its customers. Dabs.com plc also claimed that their prices were subject to frequent fluctuation due to the competitive nature of the industry, and that customers were accustomed to checking prices online rather than relying on prices shown in printed materials.
The ASA were not persuaded by the arguments of dabs.com plc, and took the view that consumers would expect an advertised price to be correct at the time the advertisement was seen. The ASA considered that the price shown in any printed advertisement should reflect the price at which the product was sold whilst the advertisement was in circulation. As to the wording “check dabs.com for latest prices”, the ASA considered that this was not sufficient to inform consumers that prices in the advertisement were subject to frequent change. Consequently, the advertisement was found to be misleading and dabs.com plc was instructed to ensure that their advertised prices were correct at the time of publication, and that goods continued to be available at the advertised price whilst the advertisement was in circulation.
Finally, the ASA suggested that a printed brochure was an unsuitable medium for advertising products whose prices were subject to fluctuation, since those brochures were likely to remain in circulation after prices had changed. The ASA did not, however, go on to consider whether a properly worded disclaimer would overcome this problem. Until such time as this point is considered further, the ASA decision is likely to have far-reaching consequences in relation to the printed advertising materials used by online retailers whose prices do commonly fluctuate.
For more information, contact your usual Marks & Clerk attorney, or Michael Shaw at mshaw@marks-clerk.com.