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February/March 2011

When to tell customers how they’ll

benefit from a product... and when not!

Most sport products are sold with the promise that they will benefit the athlete. Whether it is correcting pronation, enhancing hitting power, improving muscle tone, or creating better balance, by nature, sport product development is aimed at improving athlete performance. How much proof is needed to support the claims by advertisers? BEVAN FRANK explores the regulations governing advertising

In order to sell a product, an advertiser needs to tell consumers how they will benefit from buying the product. When it comes to sport or outdoor equipment, that would often entail explaining how the product will help improve the performance of the user.

With reputable brands, the performance enhancing claims will most likely be based on studies done during the development of the product.

But, what is the level of proof required before an advertiser may make certain claims?

In terms of the Code advertisers are required to be able to substantiate any claims that can be objectively verified before they can actually make the claim. In addition, the verification must either come from, or at least be evaluated by, an independent and credible expert in the field.

“Practically speaking, this means that advertisers are allowed to do their own internal research, but then an independent and credible expert has to evaluate this research and confirm unequivocally that it is sufficient and confirms the claims in question,” says Corne Koch, Communications Manager at the Advertising Standards Authority of SA (ASA).

“Generally speaking, the onus of proof lies with the advertiser. If he happens to satisfy the ASA that the claims are true, but a complainant has conflicting evidence or research (which also meets the criteria in terms of independent and credible expert verification), the complainant can request arbitration. This means that we source a completely neutral expert of sufficient standing and knowledge to judge the science.”

As a rule, ASA does not accept anecdotal evidence as proof, says Koch.

Documentary evidence, whether in the form of survey data or any other documentation, should be up to date and current, and should have market relevance, adds Janine Hollesen, a director at Werksmans Attorneys.

Survey data should conform to the following:

  • The survey should be conducted by an entity approved by, or acceptable to, the Southern African Market Research Association (SAMRA);

  • "The accuracy of the claims should be confirmed by an entity approved by, or acceptable to, SAMRA.

  • “Where the survey does not meet the above requirements, it will be evaluated by SAMRA to confirm the accuracy of the claims and the advertiser shall bear the costs,” says Hollesen.

  • Any other documentary evidence must come from, or be evaluated by, someone who is independent, credible, and an expert in the particular field to which the claims relate — and be acceptable to the ASA.

  • Hollesen cites as an example of where the ASA found that an advert had to be withdrawn as it could not be substantiated the well-known pay-off line Duracell lasts up to 6 times longer than ordinary zinc carbon batteries.

    “The party complained against will no doubt wish to bring alternative evidence to prove that it can substantiate the claim,” she says “However, it is for the ASA to be satisfied that the documentary evidence presented substantiates the claim sufficiently.”

    Apart from truthful presentation, advertisements should not be misleading. The Code stipulates that advertisements should not contain any statement or visual presentation which, directly or by implication, omission, ambiguity, inaccuracy, exaggerated claim or otherwise, is likely to mislead the consumer.

    “Based on the admission by the company (manufacturing power armbands) that their claims are unfounded, any claims made in local advertisements, brochures and packaging regarding the benefits thereof, could also be regarded as misleading and in contravention of the Code,” Hollesen states.

    One ruling fits all?

    The fact that another country ruled against claims made by manufacturers would, however, not be binding in SA.

    “The SA Code is designed to address issues of marketing and communications within the South African context and environment,” says Koch. Rulings from other countries do not apply to the SA Code and will not directly influence a ruling.

    Each complaint is evaluated individually against the Code. The ASA is a reactive body and does not monitor advertising in SA. It does, however, consider complaints about content of advertising.

    The question arises if the ASA finds against one manufacturer claiming benefits for a product, whether other manufacturers of similar products may then continue with their advertising claims? (For example, another brand of power armbands advertises on most websites with information on the lawsuit and ruling against Power Balance!)

    The answer is a resounding yes. “The ASA ruling is only applicable to the advertiser against whom the complaint is made,” says Hollesen.

    But, the general principles of the Code still apply to all advertisers. “The fact is that when you make a claim, you have to have substantive proof that the product being offered can do what is advertised,” says Koch. “Other manufacturers will still be able to advertise, unless the company or advertiser is from the same holding company. But, the other company will have to have substantive claims when being asked to produce them by the ASA in an investigation.”

    Scope of rulings

    May the manufacturer continue with promotions, direct marketing or sales?

    It is important to note that an ASA ruling applies to all advertising placed in all mediums. “Due to the wide definition of advertisements, promotions and direct marketing would also be affected,” says Hollesen.

    “Packaging is included in the definition of advertisement and will therefore be included under the provisions of the Code,” Hollesen explains. “The products do not have to be withdrawn, but the claims made in relation to them have to be withdrawn.”

    Hollesen says that the ruling will not be binding on a retailer selling the products — it would, however, affect the retailer indirectly in the event when the claims have to be withdrawn. “The advertiser has three months in which to withdraw claims made on packaging, during which time he must cease distribution of the product.”

    If a retailer continues to sell the product, a further complaint could be brought against the retailer.

    “If we tell company XXX to remove their claims, the Code requires them to remove them from ANY media in which they appear, including, for example, brochures in retail outlets,” says Koch. “If this does not happen, we will hold company XXX accountable and possibly consider imposing sanctions on them for a breach.”

    The Consumer Protection Act

    Would the Consumer Protection Act make any changes to what’s permissible in ads and what the advertiser’s responsibilities are?

    "The Consumer Protection Act No. 68 of 2008 (CPA) is certainly designed to ensure that advertising is conducted responsibly and without undue misrepresentation to consumers,” says Neil Kirby, a director at Werksmans Attorneys.

    Since the ACT only becomes effective on 1 April 2011, it will not affect current advertising practices.

    “After 1 April 2011 the CPA will address aspects of advertising (subject to exemptions or exclusions that may apply) and impose particular obligations on advertisers to market goods in accordance with the principles contained primarily in section 29 (responsible marketing), section 40 (unconscionable conduct) and section 41 (false, misleading or deceptive representations).”

    According to the Code, advertising should be prepared with a sense of responsibility to the consumer, should conform to the principles of fair competition in business, and no advertisement should bring advertising into disrepute, or reduce confidence in advertising as a service to the industry and to the public.

    In summary, Koch states that one of the major principles of the Code is that a manufacturer/advertiser should truthfully present its product. Koch urges manufacturers and advertisers of products to make sure that they keep their advertising decent, legal, honest and truthful and prepared with a sense of responsibility.

    “In other words they should not go and find documentary proof about the performance of a product — and that it does what it claims to do — AFTER a complaint had been lodged at the ASA!”

    Special Thanks to

  • Corne Koch, communications manager, ASA,
  • Email: corne@asasa.org.za

  • Janine Hollesen, director at Werksmans Attorneys,
  • Email: jhollesen@werksmans.com

  • Neil Kirby, director at Werksmans Attorneys,
  • Email: nkirby@werksmans.com

    For more information on the Advertising Standards Authority visit www.asasa.org.za


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