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Marketing

01 Aug 2008

I sell computers, I believe our prices are lower than all our competitors in New Zealand. Can I advertise that we have the "BEST prices on computers in New Zealand"? I also want to tag certain products in the advertisement as being the "lowest price" in New Zealand.

The word "best" is designed to attract consumers to buy your product and not a competitor's. As a retailer, you must be careful when you attach the word "best" to the price. You must not make any statement in your advertisement that is false or is likely to mislead or deceive in terms of the Fair Trading Act. The Commerce Commission (Commission) and Advertising Standards Authority (ASA) are bodies in New Zealand that investigate complaints about advertising.

A recent decision by the ASA considered the use of the word "best" in an advertisement by Big Save. They advertised that "Big Save's massive buying power means we can offer you the best prices on Furniture in New Zealand".

The ASA Complaints Board held this statement was an absolute and superlative claim, which a reasonable consumer could interpret as applying to all furniture items sold through Big Save. It created an impression that all their prices are the "best" in New Zealand.

The advertiser failed to provide evidence to demonstrate its prices were better than all other industry members. The Board held that in the absence of such substantiation, this claim would be likely to mislead. It could exploit the consumer's lack of knowledge and, as such, was held to be misleading.

In your case, you should not advertise that you have the "best prices on computers in New Zealand", unless you can substantiate that, at the time of publishing the advertisement, your prices on all items sold are the best. Care should also be taken to review the status of this claim on a regular basis to ensure it remains current. As an added measure you could also adopt a policy of beating any competitor's advertised price to ensure that you are able to deliver the "best" prices.

In relation to tagging certain items as "lowest price", you must make sure you can provide price comparisons with other computer retailers at the time of publication, to indicate that your price on that particular product is the lowest in New Zealand.

Therefore, if you want to advertise that you have the "best prices" or even the "lowest prices" in New Zealand, you must ensure you can substantiate your claim with clear and compelling evidence. This ensures that consumers are not misled. They can rely on the information in the advertisement and make an informed decision.