Retailers draft off-price ad rules - department stores, discount stores, and catalog showrooms set advertising rules

Discount Store News, Oct 30, 1989 by Ken Rankin

Retailers Draft Off-Price Ad Rules

WASHINGTON - Several major discounters and catalog showroom chains have joined with other leading retailers to hammer out controversial new ground rules governing off-price advertising.

In addition to setting standards for substantiation of retail price ad claims, the "Code of Advertising" establishes basic principles for advertised price comparisons, lowest price claims and price matching guarantees by retailers.

The standards, which are in the "draft" stages, are being developed by a panel of retailers for the national Council of Better Business Bureaus (CBBB). Members of that "task force" are Ames, Best Products, Dayton Hudson, K mart, Marshalls, Service Merchandise, Sears, JCPenney and Montgomery Ward.

Although the guidelines are designed to be voluntary, officials at the council plan to circulate these ad standards to both private and government enforcement agencies.

In a letter outlining the plan to IMRA president Richard Hersh, CBBB's vp/senior counsel Steven J. Cole noted that "BBBs throughout the country [are expected to] use these standards to monitor local, regional and national advertising and we would hope that consumer protection officials would similarly rely on these standards as benchmarks for evaluating comparative price claims."

A draft version of the price advertising ground rules being circulated to retail and consumer groups stresses that retailers "should be prepared to substantiate any claims or offers made before publication or broadcast." Advertisers should also be prepared to supply this substantiation "promptly to the advertising medium or the [local] Better Business Bureau," upon request.