Promotional offers take many forms, such as guaranteed gifts with purchase, buy 1 get one free discount offers, sign-up to a marketing database to receive a gift, etc. A reward program is a promotional offer typically conducted over an extended period. It requires the person to generally purchase goods or services to receive points or other promotional currency, which can then be redeemed for selected items. The ACCC has recently released a report on the conduct of reward programs and found many to have unfavourable terms and conditions, which could be described as close to infringing the Competition and Consumer Act, including the unfair term provisions, such as permitting unilateral changes to the terms and conditions, unilaterally varying the value of points, retrospectively altering the value of points, or changing the points required to redeem rewards.
All promotional offers require terms and conditions and are governed by various legal requirements covering privacy, spam, contract, and trade practice laws, among other things. Businesses should be wary that the terms and conditions do not infringe unfair term provisions, seek to circumvent the consumer guarantees, are not misleading and deceptive or other provisions contained within the Competition and Consumer Act 2010 (Cth), including the Australian Consumer Law, and similar provisions in the State and Territory fair trading laws. Also, each offer should be assessed considering the laws that govern specific industries, such as liquor, pharmaceuticals, food and beverage, financial and credit services etc., and other general advertising and promotional guidelines, including the AANA Code of Ethics.
Precaution should be taken when reviewing the promotional material to ensure onerous conditions are adequately disclosed and the material does not infringe any copyright, trademarks, or other third-party rights. Onerous conditions should be highlighted to the consumer in the promotional material before purchase, such as any age restrictions, limitations on the number of claims that can be submitted, the promotional period, when travel must be taken or when the event is being held etc.
Barker & Co can provide specialist advice on all types of promotional offers and reward programs.