Watchdog Questions Truthfulness of Retailers' Advertising
By Bernice Hurst, Managing Director, Fine Food Network
Tesco and Lidl have both had complaints about advertising and promotional activities upheld against them recently by the UK's Advertising Standards Authority. Catalog retailer Argos alleged that Tesco was out-of-stock on most of the items advertised on the first day of its promotion. B&Q, a do-it-yourself superstore chain, argued that discount retailer Lidl compared prices on "similar items" using generic descriptions that could be construed by consumers as misleading rather than like-for-like brand comparisons.
Tesco submitted a lengthy and extremely detailed defense, which was only partly accepted by the ASA. Explained the ASA, "We welcomed the fact that Tesco had made clear in the ad that stock was limited, but considered that that did not relieve them of responsibility for taking all reasonable steps to avoid disappointing participants. We told Tesco to ensure that they had sufficient stock to meet demand for future offers."
Amongst other things, Lidl was criticized for circulating a leaflet advertising a range of garden products. Many featured price comparisons with other retailers with a flash on eight of the products stating "[x]% CHEAPER compared to B&Q." Small text stated, "Similar item - [description of item], £[price], purchased at B&Q in New Malden 6th February 2007."
B&Q contended that the price comparisons were misleading because the "similar items" were not identified and therefore did not give customers a fair basis on which to compare products. After comparing the items concerned for themselves, and considering B&Q's explanations, ASA told Lidl to make the basis of a comparison clear in future ads and to ensure that they held data for all products compared. ASA also told B&Q to ensure that future comparisons were fair and accurate.
Discussion questions: Do ads that promote items that quickly go out-of-stock cause more problems than they're worth for retailers? Do most customers shrug it off and shop in the store anyway or do they more often just leave unhappy?
[Author's commentary] Barely a slap on the wrist, then, for either retailer. But we all know that at least part of the intention with a promotion is to get people through the door so they can see what else you have on offer. The ASA may have told them to do better next time but chances are they did pretty well this time.