Advertising: Forty Winks to rethink savings promo

Dibbs Abbot Stillman 's Franchising Update for November 2005 says national bedding franchisor Forty Winks has given the Australian Competition and Consumer Commission court-enforceable undertakings to correct the use of its comparative price advertising.

A Forty Winks catalogue had featured sale items quoted with "$ savings" when compared with their "normal ticket price". The ACCC was concerned the claimed savings were overstated since Forty Winks normally sells its products at less than their ticketed prices in any event. A disclaimer in the catalogue explaining this fact was not prominent enough to counter the overall impression. The ACCC said the catalogue may have misled consumers by generating the impression they were obtaining more significant savings.

Forty Winks has undertaken to implement a rigorous trade practices compliance program and, going forward, advertise savings by reference to the usual selling prices at its franchisees’ stores, unless clear explanation of its alternative calculations are given.

This is a reminder to franchisors and franchisees to be careful of the way in which they market “discounts”, to ensure that customers truly understand how much they are saving.