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CAP ASA

CAP Expansion into Digital

Andrew Girdwood
Media Innovations Director
bigmouthmedia

David Hardy
Media Development Director
bigmouthmedia
 AP code expansion into digital
In March, the Advertising Standards Authority will expand the
Committee of Advertising Practice to cover the digital sector. The
precise details of how this will affect online advertisers are yet to
emerge, but what is certain is that digital marketers will need to
ensure that in future; every strategy they launch is able to withstand
more intense scrutiny than ever before.
The CAP code addresses socially responsible and truthful advertising,
maintaining that digital teams should be responsible with regard to their
consumer campaigns and ensure they uphold taste, decency and fairness at
all times. A subject the UK government is very much behind at the moment, it is
expected to become an important running theme over the years ahead.
While discussion over its practical implications will
dominate much of the year, the move is almost certain to
result in a tougher regulatory regime for all online activity.
Digital marketers will need to be careful of the competitive
WWW claims they make, ensure that quoted prices are inclusive of
VAT and other added charges, provide limited stock
warnings and cope with increased regulation around the
health, medical, gambling and charity sectors.

CAP ASA Make no mistake: every aspect of digital marketing is likely

to be affected by the ASA’s expansion into the channel and,
given that many of the specifics are to be sorted out using a
blend of precedent and on the fly judgements by a
committee of experts, nobody can be exactly sure how.
Fortunately the regulatory body has demonstrated real willingness to work
alongside the industry as the details are threshed out over the coming months,
but in the meantime there are a number of areas where brands can benefit from
ensuring their online activities will not fall foul of the new rules.

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The CAP code: to infinity and beyond
The organisation’s existing remit enables the ASA to regulate industry and
consumer facing advertising campaigns according to both the CAP and BCAP
codes of practice, two committees established to maintain advertising standards
with the aim of protecting consumers and promoting fair competition. Both the
CAP and BCAP exist to uphold the key principles of fair advertising: that every
campaign is legal, decent, honest and truthful. However, with a remit going
beyond simple content, the CAP code also addresses the administration of prize
promotions and database use.
The decision to extend the CAP’s areas of operation was taken both to ensure
that the code remains media neutral while responding to calls for action from
advertisers seeking fair competition. Pressure has also been brought to bear from
consumer groups wishing to build public trust in online marketing and political
bodies seeking reassurance that he regulatory body is taking the protection of
children and the sensitivity of childhood into consideration.
Clearly, online retailing will be the sector most obviously affected by the change,
with campaigns that speak directly to the consumer about a product or service
coming under the most intense scrutiny. Slogans such as “fastest broadband in
the land” will be subjected to investigation, for example, as the telecoms sector
finds itself under increasingly close examination.
Marketers are recommended to sign up to the ASA’s weekly adjudications email
(see the ASA website).

Whilst this reflects bigmouthmedia’s current opinion on this issue, the contents of this white
paper are of a general nature only and do not constitute specific advice from bigmouthmedia
or the CAP or ASA. This white paper does not take into account your circumstances or needs
and must not be relied upon in place of appropriate professional advice.

BMM/LBi, the CAP and ASA disclaim any and all responsibility and/ or liability for your actions
as a consequence of relying on this white paper.

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Content is key: the new regulatory battleground
Whereas until now digital marketers have largely been forced only to consider
the legality of copy contained within advertising, under the new regulations all
promotional content contained in non paid-for space will now come under the
CAP remit. An extension that takes into consideration all social media platforms,
from now on branded spaces aimed directly at the consumer - such as a
company's Facebook page - will be scrutinised.
While user generated content has hitherto been widely regarded as ‘free’
promotion, from now on any marketing communications that start a
conversation with consumers will be open to scrutiny.
The ASA will consider all UGC adopted by the website owner and incorporated
within its own marketing communications to fall under its expanded remit. For
example fake reviews, particularly those which are then incorporated into the
website in a testimonial style section, will be considered advertising under the
new code of practice.

There are a range of potential situations where user generated content

currently being adopted by marketers could fall foul of the extended rules. If a
vodka manufacturer invites consumers to send in photos of their drinks parties,
for example, then that distiller is taking editorial ownership of the photos by
posting on the website and must be certain that everyone featured in the
photos is (and looks) over 25. Can they be sure? If not, potential problems lie
ahead.
Similarly, if a brewer maintains a page featuring photos uploaded by fans the
images remain beyond the remit of the CAP code if the brand has not interfered
with, organised or compiled albums made up of the pictures. Once the beer
maker recognises these pictures however, or once fans have tagged themselves
in in the company-created albums, then the photos become subject to the rules
covering alcohol advertising.
Even repeating user commentary can be problematic. If a major retailer using
Twitter retweets a consumer's message regarding a product or offer, for
example, it is considered to have taken the decision to adopt the content and
use it in its marketing communications. From that point the company must be
certain of the availability of the item, that it can substantiate the claims made by
the consumer, and will be held responsible for any discrepancies which
subsequently spark complaints from other users.

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As a general rule of thumb, brands considering retweeting user comments
should remember that while subjective claims such as “Brand X is great” or
“Brand Y has the best dresses on the High Street” are simply expressions of the
customer’s opinions and so okay, objective claims must be substantiated.
Repeating comments such as “Brand A is the fastest car on the market” or “Brand
B is best for buying laptops”, therefore, could result in difficulties further down
the line if the marketer cannot produce evidence to show that the claims are
true.
Brands must also tread carefully around the issue of commercial tweets.
Commercial tweets will fall under the ASA’s remit if the content is controlled by
the marketer. If it is not (for example, if the marketer has paid or supplied
products to a consumer, on condition that the consumer tweets about the
marketer’s products, but leaves the actual content of tweet up to the user), the
message will be outside the ASA’s remit but the marketer might be required by
the OFT to disclose their involvement. In the US, adding a disclosure '#spon' or
'#ad' to the end of the tweet seems to be sufficient to remove any issues.

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A question of balance: getting content right
There are several contexts where the ASA’s new regulations do not apply. Press
releases and PR material are excluded, for example, while editorial content,
political advertisements and heritage advertising will not be subject to scrutiny.
While the detail of these issues will evolve over the coming months, there are a
few rules of thumb marketers can apply to keep themselves out of trouble.

Offers, pricing, availability

Any compulsory charges must be included in the upfront price. Optional prices
must be disclosed but need not be included in the headline price, while
companies must be clear if prices are dynamic and likely to change.

When promoting any deals or offers, as a general rule users must be one click
away from the complete terms and conditions. Such deals can be extended
occasionally, but extending sales should not be a regular part of the brand’s
marcoms strategy.
Comparative savings claims must be spelled out in clear English, while cost
comparisons must be substantiated.
Where a site displays deals such as ‘save from 60%’ or ‘prices start from £2.95’, at
least 10% of the items that fall under the offer must be offered at the maximum
saving / minimum price. Similarly, closing dates placed on offers will be subject
to scrutiny if they mislead the consumer into feelings of urgency to purchase.
‘Better than RRP’ claims will also be checked under the new regulations, so
marketers claiming that a product is better value that the recommended retail
price must firmly establish the price that the product is generally sold at.

Customer testimonials
Testimonials which are selected and uploaded onto a brand's website will be
under remit as they have been adopted by the company. Companies must
retain the contact details of the client/person who provided the comment or
review.

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Objective claims
Brands making objective claims will need to be able to prove the claims and
substantiate them with evidence if required.

Moderated UGC
Moderating offensive comments on brand owned digital spaces does not
automatically bring all the content in that space within the ASA’s remit. As
before, the content that falls within the ASA’s remit is content that is adopted or
endorsed by the marketer. For example, if a user posts a comment which claims
a product made them run faster, made their wrinkles disappear or extended
their life by 20 years, and the brand then responds with a comment which
endorses the claim, then they are open to scrutiny under the CAP code.
However, removing offensive comments will not be taken as evidence that all
the remaining comments have been endorsed by the advertiser.

Editorial Comment
Editorial content falls outside the ASA’s remit. However, the line between
editorial and marketing content is sometimes difficult to determine.
Consider this situation: An energy company produces a social responsibility
report on environmental issues. This report increases the amount of customers
buying their energy service or package. Has this report been deliberately used to
sway potential customers into choosing their product over another company's?
Issues will arise when it is unclear whether content is editorial or marketing
material, and a decision will be made according to where the content appears.
The regulatory body will consider the context of the content, the arena within
which it appears and whether it is seen as promoting or as supporting marketing
communications.

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Heritage Advertising
What is considered fair advertising is if companies are celebrating their brand’s
heritage by featuring old brand messages such as, for example: “Guinness is
Good for you”. What will induce scrutiny where there is room for complaint is if
the actual message is strategically used to promote new claims, with the context
and space where the message is placed determining the CAP’s action.

Employees acting as users

Agency employees giving their own opinions is permissible under the new CAP
code, but if there is belief that the brand is supplying the message or opinion,
then the comment will be regarded as marketing material. Responsibility for a
comment or claim lies with the brand and the question should be asked: is the
brand advancing the image of the brand by endorsing the comment or by not
disclosing the identity of the individual making it?

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The impact of the new rules on digital marketing
For all the following types of content see the general rules on pricing and
offers in the previous section.

Search
While SEO copywriters have long been afforded license to make bold claims and
statements in content tailored for organic search purposes, employing a range
of literary tricks enabling them to insert targeted keywords and phrases into text,
these will need to be watched in future.
Under the new rules a page alluding to local services in Manchester, Birmingham
and Liverpool, for example, would be open to having official complaints lodged
against it if the company profiting from these results did not offer services in
those cities. Given that such activities are normal practice for national companies
trading across the UK, there could well be a lot of confusion around the legality
of such tactics when the new ASA rules come into force.
A host of frequently made claims once considered pure marketing spin may also
generate complaints and prompt ASA investigations. Broadband providers will
not be able to lay claim to offering the fastest internet connections available if
they cannot prove it, for example, while companies claiming to be the Number
One provider of X or the leading supplier of Y could be forced to justify such
claims or face official censure.

Paid Search
Although strictly speaking already covered by advertising legislation, complaints
about PPC advertisements are almost certain to increase when the ASA’s bid
to regulate the digital channel kicks off in March. With campaigns on services
such as Google’s Adwords system coming under greater scrutiny than ever
before, advertisers need to take steps to ensure campaigns remain up to code.
From now on, extra efforts will need to be put into ensuring that the information
contained within PPC adverts is accurate, up to date and avoids misleading
consumers. VAT will need to be included in published prices, for example,
(unless the product is available only to business customers) while vendors will
need to ensure that the products advertised are available.

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Display
While display advertising departments will already be largely familiar with the
regulatory requirements governing the channel, the extension of the ASA’s
powers to cover the digital sector will have some impact.
Under the rules brands cannot have inappropriate imagery on adverts appearing
online, while offers displayed on banners must be accurate and clearly defined.
The era of online ‘bait and switch’ is now over.
There will be more to come as the year rolls on. A cookies and e-privacy debate
is already scheduled to take place in May that will have an impact on the
behavioural targeting of display marketing, so brands will have to remain alert to
potential changes as they move forward in 2011.

Mobile
One rather ambiguous area brands need to monitor is the field of mobile display
banner campaigns.
Blind served banners will be difficult to regulate, but an example which could
incur regulatory action would be if a banner displayed during racing games
promoted a fast car. Any advert which promotes speed or risky driving which
could be emulated by consumers in such a context would be under the remit of
the CAP code, meaning that the regulation remains dependent on both the
nature of the game and the tone of the display banner campaign.
This will be a difficult area of regulation for agencies, and they should use every
available system to analyse the data of display banner placement to prevent this
hazard.

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Social Media
Social media is one of the areas where brands will have to step most carefully as
the details of the new regulations become clear. With consumers able to actively
promote goods and services, exactly who will be charged with responsibility for
their actions remains an issue, opening up a range of potential conflicts and
problems for marketers wishing to use the channel.
The ASA’s extension into the digital arena will have implications for user
generated content that makes claims about goods or services if it is adopted or
endorsed by the brand. For example retweets will be considered to fall under
the remit of CAP and if a complaint is made after a brand repeats a consumer’s
tweet, they will be held responsible for any false or misleading statements.
For example: if a consumer broadcasts a message on twitter suggesting that
“Brand X is great because they cured my cold,” the brand must not retweet that
statement if it cannot be verified. While highlighting such unsolicited
testimonials is a mainstay of current twitter marketing technique, under the
terms of the new rules it could leave you vulnerable to censure.

Micro Location
There are almost certain to be issues surrounding advertising and age limits for
sites such as FourSquare which may not yet be sufficiently sensitive to users'
ages. FourSquare offers prizes for 'unlocking' venues, or for treasure hunts, for
example, while giving no consideration to the fact that in the absence of an age
limit, such competitions and offers are potentially being offered to children.

Affiliates
The affiliate industry has been somewhat self regulatory for some time,
particularly with the increasing prominence of the IAB Affiliate Marketing Council
(AMC). The perceived problems from the community around the ASA/CAP
extension to cover the sector have been around the fact it will now be coming
from an external source, so many practicioners are worried that they will have
little control over its implementation.
Thankfully the ASA have been supportive of the AMC and parties such as
bigmouthmedia in the past, and along with the IAB have been instrumental in

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putting them in front of the community and in developing their understanding
of a very complex industry.
As a result of the diverse range of parties involved, including Affiliates, Networks,
Agencies and Merchants the rule changes have caused some concern about
exactly who is responsible for any breaches of the code. The ASA have been
able to shed some light on this, and it is very dependent on how the
promotional communication is being relayed to consumers, and where the
information has come from.
Any breaches are not automatically going to be the merchant’s sole
responsibility, which a lot of brands have feared, but will also place a level of
responsibility on the affiliate. It has been made clear by the ASA that they aren’t
going to go hunting for inaccuracies in hobby blogs, and that the changes are
only really going to impact affiliates who are promoting misleading information.
What is key to take away from this is that nothing has been set in stone. It is
likely to take a high profile case to set a precedent as to how the affiliates
industry will be impacted by this change, but the sector has been becoming
more responsible, more answerable and more regulated in recent years in any
case, meaning that it is more prepared for change than it would have been a few
years ago.
It will absolutely take strong affiliate management to ensure communications,
promotions and affiliate resources are kept accurate and within the code
restrictions to ensure affiliates have the best possible information to promote
brands. It also puts a level of responsibility on the affiliate to make sure what
they are communicating to their own users – but this channel has always
entailed affiliates taking on some risk, and bigmouthmedia is confident that this
dynamic industry will continue to roll with the punches and work together to
help manage the ASA’s new remit.
There are most definitely grey areas to be contended with however. If a claim is
made to the ASA and the claim is determined as being valid, for example, is it the
fault of the affiliate or the merchant company?
According to the ASA it all depends on the context of the claim. When the claim
originates and legitimately rests with the affiliate marketer, then it is the affiliate
that will be held responsible. There is no definitive code as yet, but it would be
considered best practice for companies to evaluate and be aware of their
affiliates’ actions.

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Similarly, if the affiliate maintains a feed and has chosen a pay per click action on
a particular deal, and this deal subsequently goes out of date but the affiliate
continues with the deal, then they are, at that point, responsible for any
consequential complaints. However, if the company continues to feed the offer
to the affiliate after it is out of date, then the company will be held responsible
for any complaints.

Online behavioural advertising

At present, the extension of the ASA’s remit does not cover online behavioural
marketing techniques. A new framework covering this is expected later in 2011.

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Sanctions
Companies who are adjudged to be infringing the ASA’s CAP code already face
the consequences of adverse publicity if the ASA chooses to name and shame
the guilty party in any infringement.
These sanctions are set to be beefed up however, with an enhanced naming and
shaming programme set to be introduced.
In extreme cases the CAP Compliance Team will contact Google and other
search engines to arrange for the company’s paid ads to be removed. It’s
expected that only the particular PPC links found to be in breach of the CAP
code and judged as being detrimental to the consumer will be taken down.
Companies will be allowed to complain about their competitors, but they must
be open about their status and must show that they have attempted to resolve
the issue prior to the complaint being registered. Where possible, the majority of
issues will be resolved informally rather than through a formal investigation.
Digital marketers are amongst the likeliest to want to complain about regulation-
breaching campaigns run by competitors. Agencies can lodge complaints but
industry complainants are asked to resolve their concerns directly before
resorting to the ASA. Separating the genuine from the mischievous complaints is
the job of the ASA, as it is currently with complaints about offline media.
In terms of geographic scope, if a company is registered in the UK or uses the
top-level domain “.uk”, then it is subject to the CAP code. If a company is
registered abroad but has prices in £ sterling, or a +44 customer helpline
number for example, and so are obviously targeting UK customers, it may be
considered to fall under the CAP code remit.

Whilst this reflects bigmouthmedia’s current opinion on this issue, the contents of this white paper
are of a general nature only and do not constitute specific advice from bigmouthmedia or the CAP
or ASA. This white paper does not take into account your circumstances or needs and must not be
relied upon in place of appropriate professional advice.

Bigmouthmedia/LBi, the CAP and ASA disclaim any and all responsibility and/ or liability for your
actions as a consequence of relying on this white paper.

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 WWW

CAP ASA

CAP Expansion into Digital

0845 130 0022 hello@bigmouthmedia.com @bigmouthmedia

SEO PPC AFFILIATES DISPLAY SOCIAL MEDIA INTERNATIONAL

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