The ASA has delivered a pre-Christmas warning to advertisers not to rely on recommended retail prices (RRPs) when advertising price discounts, unless those RRPs can be shown reflect the genuine prices at which those items are generally sold.
Lidl issued several ads, including website claims, leaflets and press advertisements, which featured various products offered at a discount to the RRP. For example, a “Salter Toastie Maker” was advertised with a significantly discounted price of £14.99 compared with an RRP of £49.99.
Aldi believed that the quoted RRPs differed significantly from the prices at which the items were generally sold, and challenged whether the RRP claims were misleading.
Lidl told the ASA that their approach to RRPs was based on the Chartered Trading Standards Institute’s guidance for Traders on Pricing Practices. They said that all of the RRPs featured in the ads were based on information provided by manufacturers and had been sold at RRPs by third parties. They provided evidence such as screenshots of websites.
This cut no ice with the ASA. It said that consumers would understand the RRP claims in the ads to be the price recommended by the manufacturer and at which retailers generally sold the goods across the market. In one case concerning an electric juicer, the ASA noted that Lidl had provided the RRP set by the manufacturer on their website but that model of juicer was no longer on the market. It said that if a product was no longer on the market, it would not be possible to demonstrate the price at which it was generally sold.
Lidl had provided manufacturers’ RRP for other products, but the RRPs set by the manufacturer did not constitute evidence that they were the prices at which those products were generally sold. In some instances Lidl provided only one or two other examples of a product being sold at the price claimed in their ads.
Therefore, the ASA considered that given the number of retailers selling those products across the market, the examples provided were insufficient to demonstrate that the products were generally sold at the RRPs claimed in the ads. For those reasons, it concluded that the RRP and savings claims had not been substantiated and were misleading.
The ads therefore breached various rules of the CAP Code on misleading advertising, substantiation and price comparisons.
The decision illustrates that any references to RRPs must reflect the price at which the products concerned are generally sold, not just by one retailer, and the need to hold adequate evidence to substantiate savings claims.
“We told Lidl Great Britain Ltd to ensure that that future references to RRPs reflected the price at which the products concerned were generally sold. We also told them to ensure that they held adequate evidence to substantiate their savings claims”.