“Value” Claims Require Support Too.

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.