Oliver Bray, head of RPC’s branding team, considers some marketing pitfalls which may trap the unwary and provides a roundup of some of the dangers arising from recent legislation
“It’s easier to sleep with a Chartered Accountant”. Advertising puffery or (dare we say it) a claim capable of objective substantiation? Harmless puffery of course, and no doubt the Institute of Chartered Accountants in England and Wales (ICAEW) left nothing to chance by running this strapline past their lawyers before the launch of their first ever marketing campaign in 1995. Or did they? While there was nothing wrong with the ICAEW’s campaign, it highlights the dangers facing an accountancy firm (indeed any firm) embarking on a new marketing campaign or promotional activity. For what may appear to be a bit of light-hearted creativity may end up costing a firm dearly in terms of reputational damage, if not client defections.
Cue the example of the unfortunate firm (not RPC!) who rashly decided to publish a long list (by individual name) of its most eminent clients/target clients within an advert bearing the header “If you’d like your name kept out of the legal pages, take a note of ours.” The implication that the individuals were personally involved in litigation did not sit well with said clients who lodged, and succeeded in, a complaint to the ASA. Worse still, the gaff led a high street bank to utter the chilling words: “We were a client. We are no longer.” Summarising all the pitfalls of advertising/marketing law into a single article is impossible. But here are a few tips to bear in mind, plus a round up of some of the (new) dangers brought in by recent legislation.
The Committee of Advertising Practice/Advertising Standards Authority
The Committee of Advertising Practice (CAP) administers the British Code of Advertising, Marketing and Sales Promotion (the CAP Code), while the Advertising Standards Authority (ASA) adjudicates on breaches. Given that accountancy firms (generally) focus on print advertising, the CAP Code is likely to be your most immediate point of reference. Although the self-regulatory regime does not have power to fine, it does have the power to request a change to adverts/marketing material, with the ultimate sanction of referring persistent offenders to the OFT - as has recently happened in the lively spat between Ryanair and the ASA over Ryanair’s bold pricing campaigns and its punchy press ads. Check out www.cap.org.uk for the CAP Code/guidance notes and www.asa.org.uk for ASA adjudications.
The ICAEW Code of Ethics
The accountancy profession has its own set of marketing guidelines contained within the ICAEW Code. S250 broadly reflects key themes in the CAP Code, but the emphasis is clearly on avoiding bringing the profession into disrepute. The ICAEW Code highlights unclear or subjective claims as to size or quality as problem areas (eg claims that a firm is the ‘largest’ or the ‘best’).
Data protection: the direct marketing angle
Direct mail campaigns are a frequent source of complaint. Double-checking marketing lists (in particular consents obtained) is a must. If a list has been bought in, then ensure that appropriate contractual protections are in place with the seller. Even then, still sample test how the list has been compiled and remember to run it past the preference services.
ING Direct got caught out lately. It sent out a newsletter to its client database, which contained details on new mortgage, insurance and ISA products. A recipient who had opted out of receiving marketing material from ING complained to the ASA that the newsletter was in fact a marketing communication on account of those product references, and the ASA upheld the complaint. This case drives home the point that all marketing activity needs robust checking and is a reminder that it is not just the Information Commissioner who adjudicates on data breaches.
Third party intellectual property rights
Marketing is, by its nature, a creative process and the danger of infringing third party IP rights is high. Claims for copyright, trade mark or design right infringement or for passing off give rise to the greatest number of disputes, but remember also the defamation threat. Eddie Irvine v TalkSport is a classic example of overenergetic marketing landing a corporation (here the radio station) in a messy passing-off action. The claim related to an image of Mr Irvine, manipulated so that he was holding a TalkSport radio rather than a walkie-talkie. The Court of Appeal agreed with him that “he would not get out of bed for less than £25,000” to engage in this type of endorsement and awarded him that sum, plus (substantial) legal costs.
Turning now to some recent changes in legislation which add further to the marketing minefield…
The Unfair Commercial Practice Directive
The Consumer Protection from Unfair Trading Regulations (CPRs) and the Business Protection from Misleading Marketing Regulations (BPRs) came into force on 26 May 2008, in line with the EU’s new Unfair Commercial Practices Directive. The CPRs introduce, for the first time, a general duty on all businesses not to trade unfairly with consumers. Breaches result (for the most part) in the commission of criminal offences.
Pay particular attention to the Banned List, which lists 31 banned practices deemed unfair in any circumstances, but also the new prohibitions for misleading actions/omissions, aggressive practices etc. In short, the CPRs are one of the most significant changes to the regulatory landscape in recent decades and provides the regulators (OFT and Trading Standards) with substantial new powers to stop almost any unfair trading activities. A separate briefing note is available on request from the author.
Gambling Act 2005: impact on prize draws and competitions
Prize draws and competitions have always been a particularly tricky area of the law, catching out many who stray inadvertently into the prohibited zone of running an illegal lottery. The impact of the new Act is still to be fully felt in marketing circles, but be aware of the new test for skill-based promotions (eg skill levels must be such as to prevent a significant proportion of potential entrants from entering/claiming a prize) and the clarification over what actually constitutes a ‘free’ prize draw (eg a draw will only be deemed free if there is no additional payment over the normal cost of entry).
The London Olympic Games and Paralympic Games Act 2006
Given the breadth of the new London Olympic Association Right (LOAR), it will be surprising if there are not a number of high profile casualties in the build up to the London Olympic Games. In addition to existing Olympic protection regulations, the LOAR grants the London Organising Committee of the Olympic Games wide powers to prevent any form of unauthorised association in the course of trade between a business and the London Olympics. “Any” association means just that - so any word, image or sound is caught. There is even a list of ‘banned expressions’ (eg the use of combinations of the words “Games”, “2012”, “London”, “summer” etc could amount to an offence). Hailed as “the most draconian intellectual property law ever enacted”, this is definitely one advertising trap to avoid.
Racy advertising is not the natural path for an accountancy firm to take, even if the ICAEW’s 1995 campaign might suggest otherwise. Even so, case law and adjudications clearly show that even the most innocuous-looking marketing can land a firm in hot water. The best advice is to simply remember that very fact, and to build legal consultation as early as possible into the creative process such that the firm’s name is kept in the spotlight for all the right (and not all the wrong) reasons.