Who: Ofcom, Orion Media (East Midlands) Limited (Orion) and Pentagon Vauxhall
When: March 2016
Law stated as at: 13 April 2016
A recent report of a complaint to Ofcom by a disgruntled listener to radio station Gem 106 (which broadcasts to the East Midlands area) has given Orion Media (East Midlands) Limited (the licence holder for the Gem 106 service), and licensees generally, some food for thought when it comes to ensuring that commercial references in radio programming do not mislead listeners as to the availability of the promoted goods or services.
From 15-30 September 2015, Gem 106 broadcast a pre-recorded commercial message stating the following:
“…Pentagon Vauxhall, Derby and Mansfield – brand new Astra from £9,995. Terms and conditions apply.”
On hearing this, a hopeful car buyer visited Pentagon Vauxhall (a car dealership) in Derby on 29 September 2015, only to be told that the offer for the new Astra at the stated price had ended. The complainant referred the matter to Ofcom.
As this was not an advertisement in a paid-for spot but a commercial reference within a programme, Ofcom rather than the Advertising Standards Authority was the appropriate regulator.
Ofcom investigated the issue under the following BCAP rules:
- Rule 3.1: “advertisements must not materially mislead or be likely to do so”; and
- Rule 3.24: “price claims such as “up to” and “from” must not exaggerate the availability or amount of benefits likely to be obtained by consumers”.
In the usual way, the station owner Orion had pre-cleared the reference with Radiocentre Clearance, who were asked to respond.
Radiocentre Clearance acknowledged that it had approved the broadcast after receiving “confirmation that the local dealership in question had Astras selling at £[9,995]”. It explained that if stock at this price had been “severely limited”, it would have expected Pentagon Vauxhall to have said so, or asked the broadcaster to remove the commercial reference once stock was beginning to run out or had run out.
Orion (whose response incorporated Pentagon Vauxhall’s response), explained that the terms and conditions which applied to the promotion stated that offers may not apply to all retailer stocks and that transactions had to be completed by 30 September 2015, hence the period of broadcast for the reference. Pentagon Vauxhall explained that it ran out of allocated stock over the weekend of 26/27 September 2015, and therefore the period for broadcast was a reasonably accurate estimate of the level of demand.
Orion accepted that there was a brief risk that the reference might be seen as misleading towards the very end of the campaign, but Pentagon Vauxhall had sought to resolve the issue so that consumers were not materially disadvantaged. Orion also stated that had it become aware that the commercial had become potentially misleading, it would have removed it from air.
Ofcom considered that the commercial reference:
- was misleading to listeners, in breach of Rule 3.1 of the BCAP Code;
- exaggerated the availability of the Astras at the price stated, in breach of Rule 3.24 of the BCAP Code; and therefore was also in breach f Rule 10.7 of the Broadcasting Code (cited above).
In coming to this decision, Ofcom cited that the complainant had visited Pentagon Vauxhall, Derby, before the closing date of the offer and cars were no longer available at the promoted price. It did however take into account that the commercial reference had received approval from Radiocentre Clearance that Astras were available to be sold at the price stated and that a reasonably accurate estimate of such stock availability had been made, with stock running out the weekend prior to the expiry of the offer.
Ofcom also noted that Orion had assumed that it would be Pentagon Vauxhall’s responsibility to inform it of “any significant change in availability”, rather than having to “actively seek the continued validity of the offer”, but that nonetheless Orion would “ensure that it was informed about stock limitations in future to avoid recurrence”.
However, Ofcom reminded Orion that it is their responsibility to ensure that commercial references in radio programming do not mislead listeners as to the availability of promoted goods and services.
Why this matters:
Whilst the action taken by Ofcom in this case was limited to reminding Orion (and all licensees generally) of its responsibilities in complying with the Broadcasting Code and, in turn, the BCAP Code, this decision acts as a friendly reminder for licensees and businesses to ensure that commercial references are compliant with the Codes in order to avoid becoming entangled and publicly named in misleading advertising complaints.
In particular, Ofcom’s decision highlights the importance for commercial references to be accurate with regards to the offers advertised and, as far as restrictions on the stock or availability of products or services subject to such offer are concerned, these should be made clear within the promotion (or once such stock has run out, the advertisement should be withdrawn). As Orion found out in this case, it may not be sufficient to state that an offer is subject to terms and conditions which clarify availability to prevent the promotion of the offer from being misleading, where the ability to take up the offer is no longer available.