8 April 2013 - 12:25pm | by Sheridans

Online sales promotions: What brands and agencies need to consider

Sheridans Associate Jack JonesSheridans Associate Jack Jones

What legal measures should brands and/or agencies have in place when running online promotions?

Successfully run sales promotions can generate and enhance a brand’s following while increasing sales and revenues. It can also be a great way of monetising social media through data and user-generated material.

With the rise of social media platforms increasing the potential exposure and interactivity of such promotions, this in turn has amplified the legal challenges and risks promoters must control, which if not successfully managed, can severely undermine the reputation of the brand. In severe cases, this can amount to referral to the Office of Fair Trading (OFT) and Ofcom which have punitive sanctions at their disposal.

Therefore, promoters need to be pro-active and address the legal requirements before blindly jumping into a sales promotion, otherwise what may be perceived as a successful promotion, could amount to a damage limitation exercise.

What is a sales promotion?

This can be viewed as an incentive for a consumer to 'buy' into a brand by using a range of incentives to make the product more attractive. Examples include:

• Money-off/'two for one' offers
• Prize promotions
• Competitions (read our article on how to run a competition by John Haggis)
• Prize draws

The legal bit

All non-broadcast advertising codes are written and enforced by CAP. ASA administers the rules laid out by CAP. Section 8 of the CAP Code specifically deals with sales promotions.

Essentially, the promotions must be conducted equitably, promptly and efficiently and be seen to deal fairly and honourably with participants. Most importantly, promoters need to take care that appropriate measures are in place to ensure that the structure and mechanics of their promotions is not open to abuse. Avoiding unnecessary disappointment is a fundamental value of Section 8 that should be followed.

During the initial marketing communications and before rolling out the sales promotion, the following conditions (amongst others) must be set out:

• How to participate
• Start date
• End date
• Prizes and gifts
• Promoter’s name and address

Promoters should ensure that all rules, entry instructions and other material terms in the promotion’s Ts and Cs is readily understandable by the intended audience (this has a significant bearing if the promotion is aimed at children).

If the promotion covers multiple social media platforms, promoters should also consider the minimum guidelines set by the particular platform, such as Facebook who notoriously control robustly what can and can’t be done in a promotion.

If it is run on Twitter don’t worry about the 140 characters limit – provide hyperlinks to a landing page containing the Ts and Cs and make sure the necessary terms are clearly communicated.

A promoter should also consider local consumer law advice if the competition is aimed at a global audience.

A common mistake and a lesson learnt

Creating and enforcing Ts and Cs retrospectively is unacceptable. A promoter who disqualified a partaker for canvassing votes was held by ASA as an abuse of process due to the fact that canvassing for votes was commonplace in such promotions and the promoter’s Ts and Cs did not specifically state that such behaviour was unacceptable (The Number Ltd 2012).

Useful tips for promoters considering online sales promotions:

Lighthouse Effect - ensure the campaign fits with the brand’s ethos and makeup
Due Diligence - be clear from the outset that you have the necessary rights and licences in place to operate the promotion and consider other platform requirements if the promotion is social media focused
Terms and Conditions - make sure you have well drafted T’s and C’s that are compliant with section 8 of CAP and cover all eventualities including abuse of the process
Reputation Management - if you haven’t appropriately minimised potential abuse of the process, always have a damage limitation strategy in place as a fall-back to ensure your brand’s reputation is upheld

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