PDF How to make your Advertising work even Better - Unleash the Power of Branded Merchandise

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The television advertisements prominently state that discounts will apply to all clothing. Another series of television advertisements states that discounts will apply to all homewares. In fine print both ads exclude certain brands of clothing and homewares. Related newspaper advertisements do not make any reference to the exclusion of certain brands. A failure to clearly specify the exclusions is likely to mislead customers and therefore breach the ACL. Fine print is often used in advertisements, contracts, labelling and signs.

These qualifications usually appear close to the lead selling point.

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This may not protect that business from breaching the ACL. The main selling point used for a product or service may make such a strong impression that no disclaimer can dispel it. An advertiser must not make the real terms and conditions of the offer unclear or unreadable by:. The type and context of the advertisement is relevant as well.

For example, it will be harder to ensure that small print conveys the real terms of the offer on a billboard on a highway that cars pass at kilometres per hour, as compared to small print in a newspaper advertisement. Example: A gardening service offers a special lawn mowing deal — after four paid services, the fifth lawn mowing is half-price. The offer is made through a series of radio advertising segments. The terms and conditions are in fact quite onerous, requiring the customer to live in a two kilometre radius of the business, be a pensioner and it applies only to lawn mowing on Monday mornings.

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The failure to clarify or explain important elements of the offer is likely to mislead customers and therefore breach the ACL. A business that makes a claim about future matters including predictions or projections must have reasonable grounds for doing so at the time of making the claims. If it does not then the business can be guilty of misleading or deceptive conduct. It is the responsibility of the business that made the claim to show that it had reasonable grounds to make the statement.

It is important that you consider, or adequately address, the range of uncertainties and variables involved when making claims about the future. Example: A real estate agent claims that a golf course will be developed in the area within the next year as a major selling point to the properties sold.

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The agent continues to make these claims despite knowing there are no plans to develop a golf course. The agent is misleading potential purchasers by suggesting there are such plans when the agent has no reasonable grounds to do so. Under the ACL it is illegal to request payment for goods or services that the consumer has not agreed to buy. In a dispute, if you are demanding payment, you must prove your legitimate right.

Some businesses may try to place consumers or other businesses in a position where they will either:. While washing her hair the hairdresser gives her a conditioning treatment that she did not ask for. It is common for a business to seek to persuade a consumer to buy goods or services by promising benefits if they help the business supply goods or services to other consumers.

The ACL makes such a practice illegal if receipt of the benefit for example, a rebate or commission is dependent on the other consumers also acquiring goods or services. The consumer may never receive the benefit in these circumstances, which is why the practice is illegal.

Example: A sales assistant offers a customer 10 free DVDs to go with their new plasma TV on the condition that they give the business the names of five of their friends and that these friends all buy plasma TVs from the business. This type of offer is illegal. It is not referral selling for a supplier to promise a benefit for simply providing the names of consumers.

This is likely to be a breach of the ACL. If you do accept payment in advance, you must supply the goods or services within the time you have specified, or within a reasonable time, if no time is specified. An agreement is considered to be a lay-by agreement if it is between a supplier and a consumer, where:. Agreements must also be expressed in plain language, be legible and presented clearly. A consumer can cancel a lay-by agreement but may have to pay a reasonable termination charge.

This termination charge must be specified in the agreement. Example: A customer orders a Christmas hamper in advance and agrees to make regular monthly instalments. This is a lay-by agreement and the supplier must ensure they have met all the lay-by requirements, including providing an agreement in writing to the customer specifying all the terms and conditions and any termination charges that may apply. Common complaints about these channels include non-supply and incomplete supply of services, and difficulty in booking services and redeeming vouchers before they expire.

Example: A group buying platform sells vouchers for customers to get two bunches of flowers for the price of one at a florist. The site specifies a time limit for redeeming the vouchers but does not indicate any limit on how many vouchers the florist will honour. The florist cannot keep up with a late rush of demand in the last days of the validity period and refuses to honour a number of vouchers.

The group buying platform, which has the contract with the consumer, in addition to the merchant, is responsible for providing a remedy under the Act which, amongst other remedies, may include a refund. Related information: Online group buying. Advertisements for health and medical services, and the benefits they provide, can have a powerful influence on consumers. It is essential that businesses selling health and medical products and services provide consumers with accurate and truthful information so they can make informed decisions.

Real case study: A business manufactured and sold wristbands that it claimed improved balance, strength and flexibility. After the ACCC expressed concern about the claims, the manufacturer admitted there was no scientific evidence and therefore no reasonable grounds for making the representations. The business offered refunds to consumers and provided a court enforceable undertaking to the ACCC that it would publish corrective advertising, remove misleading representations from its website and not make claims about its products that are not supported by independent testing. The company could not do this.

The Federal Court found that the company had engaged in false, misleading or deceptive conduct and that its director was knowingly concerned in or a party to the contraventions. Businesses often make claims about their products in an attempt to obtain a selling advantage. These claims go beyond generic descriptions of products. The Act is complemented by Standard 1.

Advertising and selling guide

Media release: Olive oil producer pays infringement notices for extra virgin claims. As consumers are often unable to assess the accuracy of premium claims, you must ensure that the claims you make can be substantiated. Free range claims are used to market animal products, such as eggs and meat, that have been farmed in an open range outdoor environment. Businesses should be careful about what impression may be conveyed by any pictorial representations they use. Real case study: The ACCC took action against a duck meat producer in relation to false and misleading statements that its duck meat products were open range when the ducks were raised solely in indoor sheds.

The producer was found to have made misrepresentations on its packaging, website, delivery trucks, signage and merchandise through written and pictorial representations. The ACCC argued that these descriptions represented that the ducks, amongst other things, spend a substantial amount of time outdoors when this was not the case.

Some businesses claim their product has not been tested on animals. Claims should be clear and accurate so consumers have the ability to make informed decisions.

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Businesses that choose to make claims about animal testing should ensure that the claims are accurate and do not constitute misleading or deceptive conduct or false claims. If you wish to make environmental claims about your business or your product, they should be honest, accurate and able to be substantiated. You should clearly explain, in simple language, the significance of the benefit to the environment.

Real case study: A whitegoods manufacturer provided a court enforceable undertaking following concerns that it may have misrepresented the energy savings of certain of its washing machines compared with conventional washing machines. Related publication: Green marketing and the Australian Consumer Law. Real case study: A manufacturer of plastic bags heavily promoted their bags as biodegradable and therefore environmentally friendly. However, the company could not substantiate these claims.

The ACCC took action against the company and the court declared that it had engaged in false or misleading conduct, misrepresented the benefits and performance characteristics of the bags and misled the public on the nature and characteristics of the bags. Businesses must be able to substantiate any such claims.

The ACL is complemented by a set of voluntary industry standards, which are developed and reviewed by Standards Australia. There are several Australian standards that relate to organic or biodynamic claims. If using the AS — Organic and biodynamic products label, your produce or product must meet requirements outlined in the standard. For further information, visit the Standards Australia website www. Real case study: An egg packer and supplier was found to have substituted and sold non-organically produced eggs as organic eggs over a two year period. This was a breach of the ACL.

Organic standards acknowledge that water cannot be organic so any claim that water is organic would therefore be false or misleading. If you supply food products in Australia, it is likely that you will be required to comply with the Country of Origin Food Labelling Information Standard The Standard was made under the ACL and requires mandatory origin labelling for certain foods.

If you believe you sell or supply food that may be covered by the Food Labelling Information Standard, you should refer to our Country of origin food labelling guide for information on how to comply. Businesses can however, choose to make country of origin claims about these goods. All businesses, whether they are legally required or choose to display country of origin labelling, are prohibited from making false or misleading representations or engaging in misleading or deceptive conduct about the origin of goods both food and non-food.

If a reasonable conclusion from the use of particular words or images is that a good was grown, made or produced in a particular country when that is in fact not the case, there is a risk of breaching the ACL. The defences relate to claims a product:. These claims are about production process rather than content. To establish the safe harbour defence the goods must have been substantially transformed in the country of origin being claimed.

It will not be sufficient for the purposes of the ACL for a product to be somewhat different from its imported parts. Mere changes to the form or appearance of imported goods will not satisfy the substantial transformation test. When determining whether something is a significant ingredient or component, businesses should consider the importance of the ingredient or component to the nature or function of the product. Media release: Gold Coast retailer pays penalty for false or misleading Australian made and per cent wool claims. A business may choose to provide additional information and make other claims about a product on its packaging.

This could include a breakdown of where individual ingredients or components were grown or produced, a non country place of origin claim e. Businesses are entitled to make additional representations on their packaging label. However, if they do so, they must ensure the representations are accurate, truthful and compliant with the law. Tip: It is important to note that the safe harbour defences in the ACL do not apply to non-country place of origin claims. A number of schemes exist to give customers confidence in claims made about goods. Many products carry a logo or other trademark to show they are certified by a particular scheme or have a recognised standard of quality or performance.

Credible schemes will provide detailed information about the basis on which they make claims, such as recognised standards. Setting prices is a key element of selling goods or services. Complaints and disputes often arise when consumers agree to the cost of a product or service before it is provided but the price they eventually pay is more than they expected.

You can help avoid this type of dispute by clearly explaining your terms and conditions, including pricing, to the consumer before they agree to purchase a product. When you present prices to your consumers, you should state the total price. This applies to advertising across all mediums. If you promote a price that is only part of the total price of goods or services, you must also include the total price as a single figure at least as prominently as the part price. It is also illegal to represent to consumers that the price of a component or components is the total price.

The single price must include any tax, duty, fee, levy or other additional charges e. GST or airport tax. A purchase also attracts 10 per cent GST. A prominent single price is one that is clear and stands out so that it is easily noticed by a consumer. For example, in print advertising, if a single price is smaller or in a colour that is harder to read than any component price, then this is likely to mean that it is not as prominent. An optional charge or extra is something a consumer must elect to include as part of a product or service i. The airline, for 10 months, did not display on its website some airfare prices inclusive of all taxes, duties, fees and other mandatory charges in a prominent way and as a single figure.

The exemption also does not cover goods other than food or beverages, services such as corkage or cover charges that are included on a menu. A single price for these services must be displayed at all times. Legislation: Competition and Consumer Regulations regulation 80A. Sometimes a business may have two different prices on display for the one item. A business that displays more than one price for the same good must either:. Example: A business operates three different stores in Brisbane.

One of the stores publishes an advertisement in their local newspaper listing a number of specials. The specials are only applicable to that store. The advertisement does not say that the specials are limited. Consequently some customers shopping at the other two stores purchase the products expecting to pay the special price. The business must publish a retraction advertisement in the local newspaper, withdraw the items from sale or sell them at all stores at the lower price.

Businesses often make comparisons between the prices they are currently charging for a product and:. Businesses that use such statements must ensure that consumers are not misled about the savings that may be achieved. Offer prices are not, however, the end of the enquiry. It is recommended that businesses seek legal advice before doing so or alternatively, to consider some other way of promoting and selling their products.

If this is not actually the case, consumers are likely to be misled. Businesses using statements such as 'savings' or 'discounts' when comparing a sale price to the RRP of goods and services may convey to potential customers that they are getting a good deal because the sale price is less than the RRP.

If the product has never been previously sold at the RRP, or the RRP does not reflect a current market price, then this type of comparison may, depending on the circumstances, misrepresent the savings that may be achieved. It is good business practice and fair trading risk management to keep records substantiating any two-price comparison claim, as you may be required at some later point to substantiate such a claim to an ACL regulator, including the ACCC. The ACL regulators have the power to compel you to substantiate such claims.

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It is also important to remember that a 'sale' or 'discounted' price should only be available for a limited period. This is because if a reasonable amount of time has elapsed and an item is still 'on sale', the discounted price effectively becomes the new selling price, so it may be misleading or deceptive to continue to call it a 'discount' or 'sale' price. The court relavantly found that:.

The issue is whether the goods would have been purchased at the 'was' price before the sale period and consumers would actually achieve a saving. Notwithstanding this decision, every case will be different and it would be open to the Court to find in another case, depending on the particular factors, a different period. Unit pricing means displaying the price of a grocery item as a standard unit of measurement alongside its selling price.

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It allows your consumers to quickly compare the value of products of varying size and brands. Some items are exempt from the Unit Pricing Code, including books, flowers, manchester, toys and some marked-down products. The unit pricing requirements apply to advertisements in the print media but do not apply to advertisements on television, radio or other electronic media other than a website.

You cannot make false, misleading or deceptive claims about the price of goods and services. As a business, you are entitled to increase your prices as you see fit — it is business as usual. However, like any claim you make, if you choose to make a claim about the impact of the carbon price or why a price has increased, this claim should be truthful and have a reasonable basis.

If you don't provide one, a consumer has the right to ask for one. Consumers have the right to ask a service provider for an itemised bill or account up to 30 days after receiving the bill. You must provide this free of charge and within seven days of the request. Legislation: Australian Consumer Law ss. The ACL includes rules on unsolicited sales practices, including door to door selling, telemarketing and other forms of direct selling. With unsolicited door to door or telemarketing, the ACL allows a day cooling off period for consumers generally to change their mind and cancel the contract.

They can also cancel the contract within three or six months if the supplier has not met certain obligations. The ACL also sets out the disclosure obligations when making an unsolicited agreement. The business must:.

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Permitted hours for telephone sales are regulated under the Do Not Call Register Act and associated telemarketing standards. A salesperson can visit at any time if an appointment has been made. The appointment must be arranged by telephone or in writing, not in person. The Consumer Contracts Regulations cover your cancellation rights.

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