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Taking the pressure off: the CMA has released its position on the use of countdown timers, discount claims and other pressure-selling tactics

Taking the pressure off: the CMA has released its position on the use of countdown timers, discount claims and other pressure-selling tactics

Published

Mar 31 2023

Written By

Robert Turner

Partner
UK

Sophie Stoneham

Associate
UK

On 29 March 2023, the UK’s Competition and Market’s Authority (“CMA”) published a letter to UK businesses which outlines various pressure selling tactics which the CMA considers would likely breach consumer protection laws.[1][2] If your business uses, and is considering using, any forms of pressure-selling to induce consumers to transact, then read on.

Consumer protection laws

The key legislation here is The Consumer Protection from Unfair Trading Regulations 2008 (“CPUT”), which establishes that unfair commercial practices in B2C contexts are prohibited. Under CPUT, “commercial practices” relate to all conduct connected to the promotion, sale and supply of products/services to consumers. This broadly-worded prohibition has been used to outlaw a range of different commercial practices that have arisen over the years in e-commerce and online selling generally. Under CPUT, practices are unfair (and therefore banned) if they constitute misleading actions or misleading omissions. There are also certain practices which are automatically unfair and banned.

The CMA’s letter

The letter forms part of the CMA’s ongoing work into harmful online choice architecture (otherwise known as ‘dark patterns’)[3]. In the first instance, the CMA is targeting urgency claims. These include time limited claims, countdown timers, ‘hurry’ messaging and other scarcity claims. The key legal issues are that (in certain contexts) these practices can mislead consumers and put unfair pressure on them to purchase quickly.

The letter provides helpful practical examples and explanations of why certain practices are unlikely to comply with consumer laws. We summarise these examples below.

Example	Issue
False time limited claims A trader states that a promotion will end at a particular time, but the promotion continues. For example, using countdown timers or claims like “ENDS TONIGHT!”.	The claims are untrue because the promotion continues. This also risks putting unfair pressure on consumers to act fast when they could take more time to consider the purchase.
Deceptive time limited claims A trader states that a promotion will end at a particular time, but a similar or comparable offer is available after the initial promotion ends.	Whilst the information is true, the information is deceptive because a comparable offer is available after the promotion ends. This means consumers may feel pressurised to purchase quickly, when they do not need to.
False checkout timers A trader states that there is limited time to complete a transaction using a countdown timer on a checkout page. However, the countdown timer resets when it reaches zero.	The checkout timer puts unfair pressure on consumers to purchase quickly when they do not need to, and so is likely misleading.
False stock claims A trader states that its stock levels are low, however the trader: is not short on stock; will be receiving stock shortly; and/or can perform its contracts without delay.	The claims either contain false information (stock is not actually low), or provide the false impression that consumers must act fast to purchase the product before it sells out.
False urgency claims A trader uses claims which reflect consumer interest in a product, encouraging them to act quickly. For example, “HURRY! 10 people are viewing this now.” However, the trader has lots of stock and/or can perform its contracts without delay.	These claims create the impression there is a lot of consumer interest in the product, meaning a consumer should act quickly to not miss out. This is likely misleading because, whilst the consumer interest claim may be true, consumers do not need to hurry their purchases.
False timeframes A trader provides live data reflecting consumer interest in a product. For example, “20 people are viewing this now.” However, the data does not reflect current conditions, but in fact how many viewed in the previous hour.	The claim does not match the live data gathered by the trader, making consumer interest appear higher than it is.
Purchase activity claims A trader uses claims which describe consumer purchase activity. For example, “200 people bought this in the last hour.” However, whilst 200 consumers have purchased the product, these purchases related to different models of the same product.	Whilst the information related to numbers of purchases may be true in one sense, the claims provide the false impression that consumer interest in the particular product is higher than it actually is.
Deceptive sales rates A trader uses sales rates claims such as “HIGH DEMAND! 100 people bought this in 24 hours.” However, whilst this information is true, the trader is referring to a historic 24-hour period (some months ago), and not the previous 24 hours.	Whilst the information may be true, the claims create a misleading impression that they refer to recent sales figure/current demand. A qualification somewhere else on the page is unlikely to remedy the misleading impression of the headline claim.
Price Reduction claims For example: “£100 £50” / “Was £100, Now £50” (£100 represents the reference price, and £50 the discount price) The following price reduction claim scenarios are unlikely to comply with consumer laws according to the CMA: Time sold for. The product was sold at the reference price for a short time, as compared with the time it was sold at the discount price. The reference price no longer represents the product’s usual selling price. Stock sold. The trader did not sell the product in significant numbers at the reference price. The reference price does not reflect the product’s usual selling price. Flip-flopping prices. The trader has repeatedly and continuously switched the product price between the reference and the discount price. The reference price no longer reflects the product’s usual selling price, given the discount price is repeatedly offered. Lower prices charged since reference price. Whilst the trader did originally offer the product at the reference price, there have been various intervening prices. Short-lived price hikes. Whilst the trader did offer the product at the reference price, this was a temporary price increase, and the usual selling price is lower. Old reference prices. Whilst the trader did offer the product at the reference price, this was a long time ago. This means the reference price no longer represents a meaningful ‘was’ price. Omitting/hiding key information. A price reduction is available (such as “50% off everything!”), however there are conditions that the consumer must fulfil in order to benefit, which were not clearly stated in the headline claim (for example, a consumer must spend over £200 to redeem the discount).

Whilst the CMA cannot create law, it plays a key role in regulating the behaviour of businesses in a B2C context by investigating and bringing actions to enforce the law. We would encourage businesses to review their practices to ensure no misleading or unfair pressure-selling tactics are employed.

[1] Shoppers urged to call out online rip-offs as CMA unveils ‘red lines’ - GOV.UK (www.gov.uk)

[2] Urgency and price reduction claims: compliance advice for online businesses (the open letter) (publishing.service.gov.uk)

[3] https://www.gov.uk/government/collections/online-choice-architecture-work