We Americans love our freebies, and the competition for “what’s in your wallet” has never been more intense, with issuing banks focusing on wooing our loyalty with cash back, airline miles and points to get other free stuff as much or more often than focusing on credit terms. (I must confess I have no idea how the rate I am getting for my Disney Rewards Card compares but I reach for my “Mickey card” most often as I sure love my earned discounts when I go to the World!) NAD was asked to review a campaign for the US Bank FlexPerks Visa card, that gave side by side comparisons to American Express’ SkyMiles card, with claims such as “more value vs. less,” earn points “fast,” and “double points,” and recommended modifications to certain of the claims.
Because the parties did not submit any consumer perception evidence, NAD put on its consumer hat and made its own determinations as to how a reasonable buyer would interpret the advertising claims. Any company bringing or defending an action at the NAD has to make the difficult choice as to whether to conduct consumer surveys, almost always an expensive proposition if done right and still subject to critique, or roll the dice with NAD’s interpretations.
NAD found that the “more value vs. less” claim stating that 20,000 FlexPoints are worth up to $400 of airline travel whereas 20,000 SkyMiles are only worth $200 worth of airline travel, misled consumers to believe that SkyMiles could only be redeemed with American Express’ “Pay with Miles” program. However, SkyMiles may be redeemed in a variety of ways and 20,000 SkyMiles have potential values greater than $200.00. US Bank did provide a parenthetical disclosure that the “more value for less” claim applies only to comparisons between US Bank’s “Awards Tickets” program and the American Express “Pay with Miles” program. However, NAD found the disclosure to be inadequate for two reasons: 1) many ordinary consumers would not understand these terms and the fact that the programs are qualitatively different, and 2) the parenthetical was too small and inconspicuous.
In addition, NAD found that there was no evidence that FlexPerks consumers earned points “fast” as compared to SkyMiles consumers. Further, FlexPerks consumers do not “always” earn “double rewards” on either gas, groceries or airline purchases because the “double rewards” program does not apply to such expenditures exceeding $12,000 per year; and SkyMiles redemptions are not subject to “blackout dates” because consumers could choose to redeem more miles to obtain tickets for certain flights that are unavailable at the general miles requirement level.
NAD did find that evidence supported US Bank’s “free vs. fee” and “half as many places” claims; Delta did impose fees “up to” $150.00 on certain redemptions, and Visa is accepted in over twice as many global locations as American Express. However, NAD did recommend that US Bank modify the latter claim by clearly stating that the claim is based on global as opposed to domestic data.
When creating direct comparisons with a specific competitive product, advertisers should take care to ensure accuracy, that the express words selected for comparison do not include unintended implied claims, that all bases of comparison are clear, and to make necessary disclaimers conspicuous. If you’re going to make a claim, you have to make sure it is true under all circumstances or, if not, clearly disclose when it is or is not true, even if the circumstances under which it is not true are very limited.
See NAD’s press release here.
