Regulators release new enforcement notice on promotional pricing

A new enforcement notice for promotional pricing of e-cigarettes have been released by the UK Committee of Advertising Practice (CAP) and the Medicines and Healthcare products Regulatory Agency (MHRA).

According to the notice, advertisers are permitted to present factual information about unlicensed nicotine-containing e-cigarettes and their components on their websites, including prices. However, when an advertiser places undue emphasis on savings and discounts, this is likely to breach the CAP Code.

“It has come to our attention that some vendors are presenting prices on their websites in a way that amounts to promotion. We would like to remind advertisers of the clear prohibition on promoting unlicensed nicotine-containing e-cigarettes and their components outlined in CAP Code Rule 22.12,” the notice says.

The Advertising Standards Authority warns, “We will be monitoring websites in the coming months. If we see continued problems in this area we will take targeted enforcement action to ensure a level playing-field. This may include – where advertisers are unwilling to comply – referral to our legal backstop.”

Guidance by MHRA and CAP:

Keep it strictly factual. Advertisers are entitled to reduce prices to clear stock and otherwise demonstrate discounts. Avoid placing undue emphasis on savings and discounts, which can have the effect of incentivising consumers. Such ads are likely to be considered promotional and therefore breach the Code.

Strikethrough discounts – strikethroughs can have the effect of making the current price appear more attractive.

Limited time offers – time-limited offers will almost always be considered promotional as it prompts consumers to make a purchase sooner than they might otherwise have done in the absence of the promotion.

Clearance pricing – phrases like “SALE!”, “HUGE CLEARANCE!”, particularly when prominently, for instance using large colourful banners, should be avoided as they are likely to be considered as promoting the clearance sale, rather than providing factual information about products and their pricing.