Promotional material and advertising

Many of the complaints made to the Commission are the result of inadequately checked publicity material.

A system for checking promotional material is central to most business compliance programmes.

Some points to bear in mind are:

  • In general, businesses should ensure that all marketing decisions and strategies are reviewed in light of the Fair Trading Act. This is an ongoing process and management should keep an eye on new developments in case law as these may impact on the way you do business.
  • Advertising should be checked by a staff member with the necessary product knowledge. If that person is not available, there should be a contingency plan in place so someone else with product knowledge can do the checks. The checks should include making sure that the correct picture and description of the product is used, and that the price stated, including any conditions that relate to the price, is accurate.
  • Businesses using an advertising agency should ensure that the agency fully understands the requirements of the Act. Advertising material prepared by an agency should be checked, as the business itself is responsible for any errors. An agency may also be liable under the Act unless it has a defence, such as a reasonable reliance on information supplied by another person.
  • Staff checking advertising material should be provided with precise written instructions. A checklist of details to be vetted (for example, product description, illustration, price) may be useful, and will provide a written record for supervisors to check.
  • Most publications become inaccurate with time. Promotional material should be marked with dates for which the offer is valid to avoid possible misunderstandings.
  • A system should be in place to ensure that all errors are corrected immediately and not overlooked.
  • All incorrect promotional material should be destroyed. Several Commission investigations have resulted from staff mistakenly distributing promotional material that had been withdrawn but not destroyed.

This check sheet is a tool to enable in-house checking and approval of all publicity material prior to any material being approved and released for use. This check sheet can also be used to check compliance with the sample Fair Trading Act compliance policy at any point after the advertising or promotional campaign is over.

When mistakes happen

Despite careful checking of copy before advertisements go to print, mistakes may sometimes slip through. It is important that a staff member is nominated to check advertisements once they have been published. If there are mistakes:

  • point of sale material should clearly advise customers of the mistake; and
  • senior staff should be available to handle any dissatisfied customers.

The advertising may still be misleading because of the mistake so businesses should try and minimise the consumer detriment caused by that error. Not only is such action likely to minimise any negative customer relations but it may also be taken into consideration by the Commission, or the courts.

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