The Issue Of Bait Advertising

The issue of bait advertising remains a concern for the Fijian Competition and Consumer Commission (FCCC).

Whilst it has been talked about on a number of occasions, howev­er, the practice still seems to exist in the Fijian market.

FCCC continues to come across a handful of traders engaging in this unethical business practice in order to increase their sales volume.

What is bait advertising?

It is an illegal practice whereby a business advertises goods or ser­vices for sale at low or discounted prices and the goods or services are not available in sufficient quantities during the course of the promotion.

For example, a trader runs a pro­motion by advertising five items for sale at discounted price for a period of ten days, however, dur­ing the first five days of the sale, two items run out of stock.

Nevertheless, the trader contin­ues to run the advertisement by advertising all five items.

Such tactic amounts to bait ad­vertising.

Some common examples of Bait Advertising include but are not limited to the following:

Online Trading:

• A trader advertising on social media to lure potential clients into purchasing a product(s) but the items are not delivered as prom­ised.

“One of a Kind”:

• One common example of bait and switch sales tactic, is when used car dealers advertise ex­tremely low price(s) for vehicles which are available in limited stock.

They make it seem like a deal you can afford, but when you get to the dealer, the car is already sold.

In this case, the dealer will offer to show you other vehicles you might be interested in.

Bait and Switch Pricing:

• This is an illegal practice of ‘baiting’ customers with unreal­istically low prices to bring them into the store and then try to sell them higher-price goods on the pretext that the advertised bar­gain-priced goods are sold out.

It is also called bait pricing.

“While Supplies Last”:

• One bait and switch technique that retailers use, is to offer a free accessory with a popular product to drive foot traffic to the store.

For example; a retailer may of­fer a free ink cartridge for each printer sold while supplies of the cartridge last.

But the supplies are limited and are gone by the time majority of the consumers arrive at the store. In lieu of giving you a free car­tridge, the store will try to sell you one instead.

Financing:

• Financing can be a convenient way for consumers to make larger purchases such as cars, home ap­pliances or furniture.

Companies will promote low fi­nancing rates as a major focus of their advertising for an upcoming sale.

The promise might be that eve­ryone will be eligible for financ­ing, or that financing is available at an interest rate as low as zero percent.

It is very important to read the fine print in these ads.

The bait and switch in this type of advertising is usually that only people with excellent credit might qualify for zero percent financing.

The switch is when people do not read the fine print and are met with a long list of conditions after they’ve already decided to buy an item.

How Businesses can avoid Bait

Advertisement

Businesses should refrain from engaging in advertisements of products which they do not have sufficient stock of to last the sale period.

Businesses must further evalu­ate their past promotion records to ascertain and forecast their sales volume for the new promo­tion sale.

Based on this forecast, business­es must ensure that they have suf­ficient stocks before promotional sale starts.

In the event, if the advertised items run out of stock, business must immediately stop its adver­tisement for that particular item and clearly state in writing in the trading premises that the particu­lar item has run out of stock.

Businesses must keep purchase records for verification to ascer­tain that the business has done its assessment and analysis and had made attempts to ensure it had purchased sufficient stock of items before sale promotion start­ed.

How consumers can avoid being victimised

A number of companies have been noted to be engaging in bait advertising tactics.

Hence, consumers need to be more vigilant.

• Check the terms and condi­tions of any ‘sale’ or ‘special’ be­fore finalising a purchase.
• You may find that the terms are vague, and that the item you want to purchase is not available.
• Refrain from purchasing an item outside of your price range or make a purchase that makes you feel uncomfortable.
• Understand the terms of any ‘special’ before you commit to making a purchase, to avoid unex­pected costs and repayments.
• Compare prices for similar products and services offered by other companies by shopping around before purchasing the item.
• Clarify the pricing terms and any other associated cost attached to the item.

Many bait advertisements have open-ended or confusing pricing terms. Make sure to clarify the pricing before finalising the sale.

Laws Regarding Bait Advertising

Bait advertising is governed by Section 86 of the Fijian Competi­tion and Consumer

Commission Act 2010 (FCCC Act 2010) which states:

• A person shall not, in trade or commerce, advertise goods or ser­vices for supply at a specified price if there are reasonable grounds, of which the person is aware, or ought reasonably to be aware, for believing that person will not be able to offer for supply those goods or services at that price for a pe­riod that is, and in quantities that are, reasonable having regard to the nature of the market in which the person carries on business and the nature of the advertisement.
• A person who has, in trade or commerce, advertised goods or services for supply at a specified price shall offer the goods or ser­vices for supply at that price for a period that is, and in quantities that are, reasonable having regard to the nature of the market in which the person carries on busi­ness and the nature of the adver­tisement.

Reporting the Matter to FCCC

Consumers are encouraged to re­port unethical market practices to FCCC.

If a consumer comes across any advertisement where a trader has or is advertising certain items or products on sale and upon visiting the particular outlet the consumer ascertains that the item or prod­uct is not available in stores, then he/she must report such matters to FCCC. Members of the public can visit any of the FCCC offices, call or email in order to lodge a complaint if they come across such instances.

However, personal visit to the FCCC offices is encouraged with documentary evidence to formal­ise a complaint.

Any complaint without proper documentation would be consid­ered, as an informal complaint.

For more information/details on Fijian Competition and Consumer Commission and FCCC Act 2010, visit our website on http://www.fccc.gov.fjct.

Feedback: maraia.vula@fijisun.com.fj