Advertising and marketing | UK Regulatory Outlook May 2024

ASA publishes outcome of its consumer research into environmental claims in food advertising

The UK Advertising Standards Authority (ASA) has published findings from its consumer research, conducted over the last year, which looked at the types of environmental claims currently being made in food advertising and how consumers understand them.

Key findings include:

• Generally, consumers believe that advertising is highly monitored and regulated in the UK and that brands cannot make environmental claims in ads without evidence and verification. Therefore, these claims tend to be accepted at face value (for example, broad claims, such as "good for the planet"). However, some consumers did express concern that some claims are too general to be verifiable. The use of specific terminology like "plant-based" or "vegan" is often assumed to be accurate as it is viewed as clear and verifiable.
• Using specific terminology or images in ads can create a "halo" effect, making people associate certain qualities with products even if those qualities have not been claimed directly. For example, using the word "natural" can lead to an assumption that the product is also certified organic.
• Visual imagery can cause people to make assumptions about claims related to the environment, animal welfare, and health. Images of products which appear to be "fresh" can be perceived as inherently "healthy" in the same way that products described as "natural" or "plant-based" are often understood. The use of "green", both as a colour and a word, can lead consumers to perceive a brand as being environmentally conscious even if no explicit claims are made.

In light of these findings, the ASA has identified various steps it and the Committee of Advertising Practice (CAP) plan to take in 2024:

• The ASA will continue its engagement with the Competition and Markets Authority, Department for Environment, Food and Rural Affairs (Defra) and industry stakeholders.
• CAP intends to provide further guidance to industry this summer in the form of a series of insight articles.
• From July 2024, the ASA and CAP will carry out additional monitoring and follow-up engagement to address obvious breaches based on existing ASA rulings and guidance, with the potential to formally investigate other, less obvious cases. Particular focus will be on unqualified sustainability and comparative environmental impact claims.
• The ASA will continue monitoring for potentially misleading "green" imagery issues in 2024.

ASA publishes new guidance on ad labelling in podcasts

The ASA and CAP have published new research and guidance on ways to ensure that ads read by hosts in podcasts are clearly identifiable and can be distinguished from editorial content.

The ASA's consumer research report finds that:

• participants tended to have negative views towards ads in podcasts, however, most of them agreed on the need for ads in podcasts as means to enable free access. There was a tension between the participants' preference for ads to be easy to listen to and the need for ads to be clear and distinct from the main content;
• the use of signifying terms, such as "paid advertisement" or "sponsored by", was considered the most effective way to mark the commercial content in a podcast. Consumers also found it useful when such terms are accompanied by other markers to ensure ads are fully clear and distinct, such as music or a jingle at the start and end or a distinct change in the hosts' tone and making sure that the ad is short and focused on the product being promoted; and
• participants highlighted the need for stricter regulation on the use of personal testimony in host-read ads.

The new CAP guidance aims to help podcast hosts make sure their ads are clearly disclosed as such. CAP strongly advises advertisers to "disclose advertising content using a clear, up-front signifying term" and to use other markers additionally (such as those identified by consumer research) in host-read ads.

The guidance takes effect on 16 August 2024.

FCA publishes finalised anti-greenwashing guidance 

The UK Financial Conduct Authority (FCA) has published finalised guidance on its anti-greenwashing rule that comes into force on 31 May 2024 and will apply to all regulated firms in the UK. See our Insight for more details.