When can I take advantage of savings in my price message / ads?
To start with, we need to be in control of some concepts, e.g. longer period and short period.
A longer period is in the Marketing Act and the Consumer Ombudsman's Guidelines for price marketing, defined as six consecutive weeks.
A short period is defined as a maximum of two consecutive weeks.
This is important in relation to how you use the price message in your marketing and signage of goods / products.
In the descriptions, we assume that you have NOT had the item / product discounted / sold cheaper for a longer period!
In the section "Price offer and Sales - what is the difference?" you can read more about the difference between the two. In this section, we will go more in depth with when you can use "savings prices" and how to find the right form.
In everyday life, we are constantly exposed to offers and different sales periods. We are met with weekly offers, volume discounts, set prices, category offers, seasonal sales, introductory prices daily. Here you get a quick guide to the different types.
Normal price: The price available to the consumer for a minimum of six consecutive weeks before a saving. The product/goods MUST have been available to the consumer during that period.
Ordinary offer / savings price (before / now price): This is typically an assortment item where you reduce the price for a short period.
Package offer / combination offer: Two or more stand-alone products which are sold at a total price. The total price can only be compared against the sum of the individual prices. All products must have been available and sold for a longer period without the reductions.
A package or combination offer does not interrupt the longer period!
Volume discount: You get a saving by buying more than one unit of the same product. The volume discount can be used in several ways.
Example 1: Buy two soft drinks (same kind) and get a 20% discount. Here, the purchase of a third unit will be at "normal price".
Example 2: Buy more than three soft drinks and get a 15% discount. Here, a 15% discount will also be given when buying e.g. ten pieces. as specified.
As with package / combination offers, the rules apply for a longer period and here too this period must not be interrupted.
Introductory prices / Opening sales: A price comparison must be made if it is clearly a new item (introduction).
Example 1: You have made an agreement with a supplier to include a completely new variant of a soft drink in your range. You are welcome to make an introductory price for a short period here. The condition is that you subsequently sell the product at the comparison price for a longer period after the offer ends.
Example 2: You are part of a chain. The other stores have had the product for sale for a long time. You are now introducing the product in your store and may therefore make an introductory price for a short period.
Save up to / save at least (may only be used in chain stores): The consumer must be able to achieve a specified saving in a representative sample of all stores based on the chain's stated "normal price".
Leftovers / Old stock: These are goods and lots that are excluded from your regular range. No new items may be added, in return you may use the savings price until everything is sold. You should be aware that if you reduce the item further, then you may only use the savings price in relation to the last reduced price!
Example: A T-shirt costs NOK 200. You must now sell out of it and choose to price it at DKK 125. After a while, you have sold 80% of them and would like to reduce further to get the rest away quickly.
Discount coupons / vouchers: A piece of paper in one form or another, or in electronic / digital format where the consumer is entitled to a price reduction when redeeming the coupon / voucher. More about the use of discount coupons can be found at the link: Rabatkuponer og konkurrencer (forbrug.dk)
Factory sales and the like: The consumer must not pay more than the retailer normally would pay for the product. This applies to the following promotional terms: Factory sales, factory sales, factory outlet, factory price, wholesale prices, wholesale sales, stock sales, etc.
There must be no extraordinarily large profit. At "factory price" no profit may be calculated. Stock sales only apply to the store's own stock!
Outlet: Physical or digital point of sale / store, which is connected to a main store. It is equated with leftovers / leftovers and is treated in this way by law. You can therefore use savings prices in relation to the "normal price" they were last sold at in the main store. If you make sales on your outlet items, the same rules apply as for regular prices. Longer period without reduction, etc. (remember max. Two weeks).
Outlet involves the following: leftovers/old stock in connection with Range/assortment changes, seasonal items, obsolete items (colors, sizes, etc.), discontinued collections, etc. Note that "new goods" may not be added here either. These are exclusively leftovers, etc. from the main store!
Used goods: When using before / now and other savings prices, only the "normal price" as a used goods can be used, not the price of a new Goods! The same rules apply for Price offers etc. as for all other reductions.
If you want to compare with a new item, it must be clear that it is a used product price against a new product price. You must further demonstrate whether the new price you are comparing with is the price in your business, another trader's or whether it is the market price!
Exhibition models, demo models: Do not use before / now or similar savings prices. If you want to compare against a new item, please note that it is a lower price because it is an exhibition / demo model. Remember: No savings price!
2nd sorting: Do not use before / after or savings prices! If you want to clarify differences between 1st and 2nd sorting, it must only be on the quality!
Comparison with competitors / market: Contrary to popular belief, you are welcome to compare prices. However, there are some important points you need to keep track of and consider if you do.
-It must be stated in the advertisement if it is a comparison with another trader's price.
-When comparing with another trader, the product must be of the same kind, quality and sold on the same terms. If there are two products that are not identical, then the differences must appear in your ad!
-The prices you compare against each other must be obtained at the same time!
-Prices must be valid when the ad starts! If the prices change, it's ok if you obtained the prices just before ordering your ad and you did not know / should know that the prices would change. One should know that the price of another trader can change e.g. in connection with Black Friday, holidays, etc.
Cheaper / cheapest: Promotional statements such as "We are cheaper", "You will find the cheapest prices with us" and similar statements are considered absolute! Absolute means ‘without exception’.
In practice, this means that ‘cheapness’ must cover a representative sample of the market in which the product is traded.
Rule of thumb: You have the obligation of documentation! You must document that you are the cheapest on all products in a product category or be cheaper than the average of the price of relevant competitors. You are not allowed to express anything else!
It would therefore be a misleading statement to advertise by being the cheapest of all or having the cheapest products if you do not have an absolute documentation for it!
Price guarantee: Today, price guarantee and price match are often used as part of the sales strategy.
To understand how this works, it is important that you have a basic understanding of the concept of Warranty. You can read more about Warranty in another blog!
When you provide a guarantee according to Danish law, it is voluntary and goes beyond a legal requirement. Be it in terms of durability, quality, defects and in this case the price. Once you have provided some form of guarantee, it is legally binding. It is therefore of the utmost importance that you have described the terms of the warranty and that this information is available to consumers.
At the same time, it means that there are few rules you must abide by. However, they are important!
-The guarantee must not contain restrictions that make it unattainable, and it must not be on products where you are the exclusive distributor or on ‘Own Brands’.
-The consumer must document that the product can be found elsewhere cheaper. Do not demand unreasonable documentation!
-You must provide a reasonable period so that it is possible for the consumer to enforce the warranty. If you make a geographical delimitation, restrictions in relation to mail order, internet sales, special offers from the competitor (day offers, queue offers, opening offers, etc.), it must be stated precisely and clearly. There must be a valid reason for these restrictions!
What You Did Not Know About Price Guarantee! If a consumer applies the price guarantee, the trader must generally reduce the price of the product to the documented lowest price!
Competition & prizes: One of the big misconceptions today is that you are not allowed to make purchase-related competitions. You may do that! It must be clear that the competition and the chance of a prize is conditional on a particular purchase!
There are two types of competitions, random and performance.
-Random: The raffle, lottery, chance games and the like.
-Performance: Drawing competition, submitting slogans and the like.
In common is that you must clearly present the conditions. The value of the prize, chance of winning and number of prizes, possibly. restrictions e.g. in the form of age or geography, selection method, time of the competition, time of drawing the winner, where and when the winner is found, how the winner is contacted, publication and finally delivery / collection of the prize and obsolescence of uncollected / redeemed prizes.
Only, shock price, offer price, promotional price: These statements may only be used in the case of particularly advantageous prices. When using comparison prices, the general requirement for the use of price comparison applies.
Free / free of charge / without payment: Nothing may be charged here other than the cost that may arise in connection with delivery / collection.
You e.g. would like to advertise with the purchase of two pairs of shoes and get a free umbrella, as long as you do not usually get an umbrella when buying two pairs of shoes. Here, too, the rules for price comparison and duration apply.
Today, you often get offers on a product, where you, at the purchase get something included in the price. An example is a manufacturer of a mobile phone, where you get a headset with the purchase of their new phone. Let's assume that the mobile phone is to be sold for DKK 8,999. without accessories or subscription. In normal sales, the headset costs DKK 1299.
In this case, you can use the word for free, at no extra cost, in the price about the headset if it follows the purchase of the mobile phone the DKK 8999. including a headset. The mobile phone must of course be sold for DKK 8999. subsequently and without the headset.
Of course, delivery costs in the form of shipping may be imposed as described above.
If you, on the other hand, sell the mobile phone incl. a headset at a price of DKK 9999. you may not use "free" and the like. This will be regarded as a set offer!
Termination sale: By a termination sale, it must be understood as a complete termination / closure of a business where you sell out of your inventory.
The rule that no new goods may be added also apply in this case. If you have several stores, you are welcome to move items from one to the other, e.g. to close one store down before the other.
There is no rule for how long a discontinuation sale may last, however, you must be aware that after three months there will be stricter rules in documentation in relation to as when the business actually is closing.