“Value” Claims Require Support Too. – Advertising, Marketing & Branding

In a recent article, AdAge quotes top ad agency
executives as saying that advertising about “value” is
likely to be important in 2023: “[consumers] care about value
as we continue to see inflationary pressure, so there will be a lot
of marketing focus on how can you communicate the value that a
brand or product provides.”

So, can an advertiser simply assert that its product is a
“good value?” Is a statement about “value” just
puffery, or does an advertiser bear some burden to have
substantiation? This brief article summarizes the key
considerations.

At the outset, context is always key. If the ad makes no express
or reasonably implied reference to a comparative product
(i.e., it is purely “monadic”), then it may well
be puffery. For example, if an advertiser merely says that its
widgets are a “good value,” then that might be an
unsupportable statement of opinion. However, if the advertiser
joins the value claim with a percentage, that assuredly takes it
from puffery to a claim. For example, if an advertiser claims its
product is “35% more valuable,” then consumers would
rightfully expect that there is an object of value comparison and
that the percentage is based on actual data.

When making “value” claims, it is exceedingly easy to
cross the line into implied comparisons, and hence the need for
support. So-called “value claims” are often comparative
in nature, whether the comparison is to competitors’ offerings,
to previous generations of the same product sold by the same
company, or to entire competitive categories of products. All of
these would require mathematical substantiation.

Consider a claim that a type of gasoline is a “better
value”, without more explanation. The claim begs the question
– better than what? Is it being compared to another
company’s gasoline? If so, is it apples-to-apples,
i.e., the same or similar octane? The prudent advertiser
will consider the risk of a challenge asserting any of these bases.
Advertisers often seek to qualify these types of claims by
expressly identifying the basis of comparison (more on that
below).

Moreover, what does “better value” actually mean? It
generally is interpreted to mean a lower price per unit. According
to a long line of National Advertising Division (NAD) decisions, if
the advertisement expressly states the basis of the comparison,
then the analysis is relatively simple. However, if the ad is
silent, the advertiser may bear the burden of demonstrating that
the price per unit is better than the top 85% of the relevant
category. In the gasoline example above, the defendant would
probably argue that value could be calculated based on price per
gallon, compared to comparable octanes, which tend to divide into
three general categories (regular, medium and high). However, a
challenger might seek to explode that categorization as
commercially unrealistic and unfamiliar to consumers.

There are implicit assumptions when making a comparative claim
that the products being compared are alike each other, unless
material differences are disclosed. It is fine to compare the
“value” of an economy brand to that of a
“high-end” brand, so long as those material differences
are made clear. But, unadorned mention of brand name
“value”, with nothing more, runs the risk of
communicating an overbroad “line claim” that obscures
relevant differences between product offerings.

How to limit or focus comparisons on just the relevant products
would require a separate article. However, the NAD and regulators
such as the FTC have increasingly been skeptical of “fine
print” disclosures. To the regulators, advertisers should use
“clear and conspicuous” disclosures, which are
“unavoidable” to the consumer.

If the value claim is based on some other attribute, such as
that the product lasts longer or offers a higher amount of some
attribute, then the ad should make that clear – preferably
within the claim itself. For example, for a can of air-freshener,
the ad might say “a better value because it lasts
longer.” A riskier alternative would be to use a headline
claim of “better value” with an asterisk pointing to a
disclosure that says something like “based on longer-lasting
freshness” or “based on more sprays per can.”

Communicating about value can be tricky. It’s frequently
comparative, and sometimes in ways that are initially not apparent.
Advertisers need to think through these permutations before running
such claims.

The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.