Key CAP Code changes – impacting on promotions

Revisions announced on 30th April 2015 to the British Code of Advertising, Sales Promotion and Direct Marketing (the CAP Code) will have a serious impact on the way that promoters have to run their campaigns, or run the risk of a complaint being upheld by the ASA.

For example, if a consumer wins a prize via an instant win ‘golden ticket’ type mechanic and they have to pay anything to claim the prize, even just the cost of a stamp to send in their lucky winning ticket or a regular rate phone call, technically this is a breach, because the CAP Code requires there to be no cost for claiming a prize.

Philip Circus, PromoVeritas’ Consultant Legal Director, commented that “although these changes reflect the European Court of Justice’s interpretation of an EU Directive, asking a consumer to send in their winning pack is hardly a major cost or issue. However unlike Trading Standards, the ASA is not able to apply the principle of ‘de minimis’ (not material) nor does it have the power to refrain from action where the public interest doesn’t warrant it, so there can be little doubt that the ASA is likely to be more rigorous in enforcing this provision than Trading Standards.”

Another key change to the CAP Code is a requirement that promoters must be able to prove that they had a reasonable estimate of likely demand for promotional items such as collecting points for a teddy bear or T shirt or that ‘consumers had sufficient information, presented clearly and in a timely fashion, to make an informed decision on whether or not to participate’. As Philip Circus says “this change makes me nervous because it might not recognise that a limited quantity offer is a totally different mechanic from a save points and claim a reward offer which is designed to satisfy all participants. My fear is that the ASA will apply the rule in a way which could eliminate this type of offer – which is frequently used for Reader Offers in the press.”

The changes followed a period of industry consultation; however the response from the industry was less than extensive. As Jeremy Stern, Managing Director of PromoVeritas, commented ‘although we made numerous comments and recommendations, most of which were well received and some of which resulted in changes to the Code wording, it was disappointing that more brand promoters did not get involved, nor a single agency. And the involvement of the IPM, supposedly representing the industry, provided no real added value or consideration of the issues. At PromoVeritas, we are determined that the interests of the broader industry will not be ignored by default.’

To find out more about how these changes could affect your promotion or to discuss solutions developed by PromoVeritas contact us on 0203 301 7360 or info@promoveritas.com.