Can you guarantee that you have the lowest prices and still pledge that if you got the first bit wrong you’ll beat any other price anyway?
Topic: Prices
Who: The Flight Centre and Oxfordshire Trading Standards
When: May 2001
Where: UK
What happened:
Price matching guarantees remain popular retail marketing methods, but some advertisers still find it difficult to toe the regulatory line. Flight Centre Retail recently advertised under the headline "Lowest airfares guaranteed. Flight Centre guarantee to beat any genuine scheduled price!" The ad went on to say "We guarantee to beat all prices, to all destinations, on all scheduled airlines."
When challenged by the Advertising Standards Authority, Flight Centre produced evidence that they did indeed drop their prices if lower prices were brought to their notice. A comparative price list showing competitors’ prices, however, showed that in a number of cases, Flight Centre’s list prices were not the lowest.
The ASA held that the guarantee to beat all prices seemed to be supported by the evidence, but the separate "Lowest airfares" guarantee was problematic because it suggested that Flight Centre’s list prices were lowest to begin with, something they had not been able to prove.
Separately, following an unrelated case in which Dixons were successfully prosecuted for promoting price matching guarantees, Oxfordshire Trading Standards called for a general ban on price matching claims until retailers could demonstrate these were not misleading.
Why this matters:
Price match claims continue to occupy much of the time of the ASA and of trading standards departments up and down the country. Linking price match/beat pledges with "lowest prices" guarantees is often problematic. Such a combination is almost by definition misleading: if the prices are the lowest in the first place, there shouldn't be a need to drop them again to meet or beat competitors' prices
Far better to stick to one or the other, and by far the less risky alternative is the pledge. One price pledge marketinglaw challenges any retailer to beat is John Lewis’s "Never knowingly undersold." It’s stood the test of time. Finally, the Oxfordshire TS call for a ban on price guarantees may be slightly over the top, but retailers should take note of the new consumer injunction regulations. Under these, reported elsewhere in marketinglaw, "Stop Now" orders can be sought in the courts by trading standards and consumer associations to prevent misleading/ comparative advertising claims which offend against the Control of Misleading Advertisements Regulations. It must surely only be a matter of time before a consumer body seeks to injunct retailers over claims of this kind.
