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Ruling Finds Pak’ N Save Breached Code Of Ethics

December 23, 2004

Second Ruling Finds Pak’ N Save Breached
Advertising Code Of Ethics

The Advertising Standards Complaints Board has upheld a second complaint that a recent Pak’ N Save advertising campaign contained exaggerated claims which were misleading to the consumer.

This is the second decision from the Advertising Standards Review Board in as many months on the matter. The first decision was based on a complaint brought by Progressive Enterprises against Foodstuffs (Auckland) Limited and this decision was in respect of Foodstuffs (Wellington) Co-operative Society Limited. Both decisions upheld Progressive Enterprises’ complaint.

In this decision, the Advertising Standards Review Board found that Pak’N Save’s campaign breached two rules in the Code of Ethics. Firstly, because it used research results in a manner which was misleading and deceptive to the consumer.

Secondly, the advertisements were also found to have made an unqualified claim on price, which was based on a snap shot survey of only 30 grocery items purchased on a specific day.

In addition, Pak’ N Save quoted a ‘leading consumer survey’, when in fact they were quoting from a short article in a newspaper which, in turn, was a summary of another article in a Consumer magazine.

The price survey was conducted by the Consumers’ Institute and was not intended for use in advertising or promotional advertising.

Progressive Enterprises Managing Director, Richard Umbers, says what Pak’ N Save said was misleading for shoppers.

“You cannot claim a national price advantage from a one-day snap shot survey.”

“Pak ‘N Save does not have the cheapest prices throughout New Zealand. Countdown is competing aggressively on price with Pak’ N Save across the country and shoppers are benefiting each day from the price war,” he says.

“Pak ‘N Save’s advertising campaign was misleading, deceptive and unethical.”

Mr Umbers urged shoppers to make their own price comparisons, “At the end of the day, shoppers know best and they should continue to test prices between Countdown and Pak’N Save for themselves.”

The Board also said the advertisements breached two Guidelines as they were not factual and informative and likely to mislead the consumer.


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