As the deadline passes for responses to the biggest ever review of the UK’s ASA-administered advertising “CAP” and “BCAP” Codes, Rupesh Chandrani, Senior Legal Counsel with British Gas, summarises key parts of the response sent in by one of Britain’s biggest advertisers.
Topic: Proposed Changes to Regulation of Broadcast and Non-Broadcast Media Advertisements.
Who: Advertisers and Marketers – A Brand Owner’s Perspective
When: 19 June 2009
Law stated as at: 26 June 2009
“Both society and the world of advertising are constantly changing so we must ensure our rules reflect those changes and are easy-to-follow.”
Andrew Marsden, Chairman, Code Review Working Groups
Consultations give those affected by or concerned about a particular subject the opportunity to put forward their views in the hope that they might be able to influence the consulting body when the final decision are made. It was with this in mind that British Gas submitted its responses to the consultations on the proposed changes to the CAP and BCAP advertising codes (the “New Codes”) on 19 June 2009.
Whilst the Code Review has been positioned as a root and branch review of the CAP and BCAP Codes, inevitably some of the proposed changes merely reflect ASA adjudications over the past few years and also provide greater convergence between the provisions of the broadcast and non-broadcast codes.
This article summarises some of the key issues arising from this consultation from an energy provider’s perspective. These comments relate to both CAP and BCAP as indicated.
Environmental Claims (Section 9 BCAP / Section 11 CAP)
One of the sections of the New Codes that CAP/BCAP proposes to expand is the section on Environmental Claims. As an energy supplier that is one of the more active advertisers in the “green” arena, some of the changes are of particular concern.
“Marketing communications must not mislead consumers about the environmental benefit that a product offers; for example, by highlighting the absence of an environmentally damaging ingredient if that ingredient is not usually found in competing products, or by highlighting an environmental benefit that results from a legal obligation if competing products are subject to that legal obligation”
As an energy company, British Gas has many legal obligations, one of which is to provide 9.7% of the total electricity that it supplies from renewable sources (rising to 15% by 2015). British Gas compliments its compliance with these legal obligations through marketing campaigns. The above rule in the New Codes raises several concerns in this respect. For example, this proposed rule would heavily restrict an energy provider’s ability to effectively promote activities where such a campaign would also count towards its Carbon Emissions Reduction Target (CERT) obligations e.g. if an energy supplier gave away free energy efficient light bulbs to its customers. British Gas believes that from a consumer view point, such campaigns are not misleading and carry a positive message on issues that are (i) of interest to consumers; and (ii) of benefit to them and others in the UK. In addition, this rule also suggests that if businesses were to exceed their legal obligations in certain areas (for example by providing 20% of their fuel mix from renewables rather than the obliged 9%) they might also be prevented from promoting the same in marketing materials.
British Gas is also concerned that under this proposed rule, energy efficiency campaigns (even when run through Government departments) could not be adequately marketed by energy supply companies. Notwithstanding that energy companies are obliged to comply with certain legal obligations, such as CERT and Renewables Obligations, messages that result from marketing campaigns and promotions are beneficial to the consumer and provide useful information on the environmental credentials of energy suppliers.
‘The meaning of all terms used in marketing communications must be clear to customers’
As is the case with some of the phraseology introduced in the New Codes, British Gas believes that the phrase “clear to customers” does not specify the level of clarity which needs to be provided to customers. There is no guidance as to whether marketers can assume a reasonable level of understanding, or if messages should be clear to customers with little or no knowledge and we believe the vagueness of this rule will simply provide more ammunition for NGOs to make increased complaints about misleading “green” claims.
There is also some confusion among marketers around the acceptable use of certain terms when promoting the environmental benefits or properties of a product or service. As a responsible advertiser, we naturally seek to avoid causing confusion with our marketing copy, as to do so would be counter productive, but this is sometimes problematic due to the emergence of new words and phrases into the environmental arena in recent years, many of which do not carry a single, generally recognised definition.
‘Absolute claims must be supported by a high level of substantiation. Comparative claims such as “greener” or “friendlier” can be justified, for example, if the advertised product provides a total environmental benefit over that of the marketer’s previous product or competitors products and the basis of the comparison is clear’
British Gas feels that the requirement for a “high level of substantiation” does not give marketers sufficient guidance. Our interpretation of this term is likely to be that this represents a higher test than for non-environmental claims in the existing code. However, the level of substantiation for non-environmental claims is rather unclear and the ASA has not been forthcoming on this subject. For example, should general/non-envirnmental claims be substantiated beyond all reasonable doubt or should such claims simply be substantiated on a balance of probabilities (or something in between)? Our experience of CAP/the ASA is that the standard of proof varies. We believe that the proposed wording will not help to resolve this issue and would request further guidance from the ASA as to what a “high level of substantiation” actually means for advertisers?
We also believe that the rule is unclear where it refers to a “total environmental benefit” as the term ‘total’ is open to interpretation by advertisers.
The New Codes also suggest that comparative claims are acceptable if there are “total” benefits compared to a marketer’s previous products. It is not clear whether it would be acceptable for advertisers to highlight environmental benefits between different products that they currently have on sale e.g. to compare a standard electricity tariff product with a product backed by renewable sources also within its current product offering, a comparison which would clearly be useful to a customer.
‘Marketers must base environmental claims on the full life cycle of the advertised product, unless the marketing communication states otherwise, and must make clear the limits of the life cycle. If a general claim cannot be justified, a more limited claim about specific aspects of the product might be justifiable. Marketers must ensure that claims that are based on only part of the advertised product’s life cycle do not mislead consumers about the products total environmental impact’
The term “full life cycle” is unclear and potentially difficult to communicate to the customer, particularly for an energy company that is part of a group whose upstream operations include exploration, drilling and production. One interpretation of the term “full life cycle” is ‘from cradle to grave’, which would mean it would be extremely difficult for a horizontally integrated energy supply business to make future environmental claims due to the requirement to include the effects of its upstream processes.
Misleading (Section 3 CAP)
“Qualifications must be clear to consumers who see or hear the marketing communication only once”
Outdoor advertising using LCD screens is increasingly popular but is subject to variable factors that are beyond the control of marketers such as the weather which may affect visibility. Currently there is little guidance specifically relating to outdoor advertising through media such as digital LCD screens. We would request some specific guidance from the ASA/CAP or through an industry organisation on the size and visibility of caveats when used on LCD screens.
A Missed Opportunity?
Although the appeals process for broadcast (and non-broadcast) advertisements was outside the ambit of the Codes Review, we consider this to be a missed opportunity for setting up a revised appeals process, perhaps loosely based around the National Advertising Review Council in the USA. A concern of many brand owners is that the consequences of having an ASA complaint upheld about a TV ad could be severe in terms of, for example, lost media costs and wasted production costs. When TV advertising was regulated by the Independent Television Commission, a brand owner could complain to the ITC Chief Executive and subsequently the ITC Chairman, in the latter case requesting that the matter be put before the full Commission. Unfortunately, when the ASA assumed responsibility for broadcast media advertising regulation, the non-broadcast system of referring ASA adjudications to the Independent Reviewer was adopted for broadcast ads. Such referrals may only be made where there has been a substantial flaw in an ASA adjudication or in the process by which the adjudication was made or if new relevant evidence has become available – not if the brand owner believes the ASA got the decision wrong. Since 2005, of the 31 broadcast ads referred to the Independent Reviewer, only 3 have been referred back to the ASA Council which suggests that such referrals are rarely successful. A more up to date and open system would alleviate some of the concerns that brand owners currently have about investing heavily in a TV campaign that is cleared by Clearcast only for the ASA Council to subsequently uphold a complaint.
Why this matters:
The UK advertising industry is unique and widely admired for its system of self-regulation. The current economic climate highlights the need to achieve certainty in the new CAP and BCAP codes of practice to ensure that they continue to protect consumers and create a level playing field for brand owners. This is particularly true of environmental claims.
Advertisers need the regulatory system to provide greater clarity in terms of what they can and cannot do. This will enable them to be confident in getting full value for money in return for the large amounts of time and money invested in advertising campaigns and would help ensure that agencies do not breach any contractual obligations with their clients to comply with these regulatory provisions. After all, it is the brand owners themselves who finance this system.