Eyes on the prize: Specsavers loses out to Luxottica in misleading advertising case
- Piper Alderman
- Bill Fragos, Tom Schinckel
- November 5 2013
In its latest legal dispute in Specsavers Pty Ltd v Luxottica Retail Australia Pty Ltd, Specsavers challenged three specific types of representation that Luxottica had made during the promotion of its Accufit glasses-fitting system. Specsavers asserted that comparative advertising in the Accufit promotion was misleading or deceptive. The court disagreed.
Since setting up in Australia approximately five years ago, Specsavers has fought hard to achieve a share of the retail optometry market, which is reportedly worth over A$1 billion a year. Its main competitor Luxottica (the parent company of OPSM, Sunglass Hut and Laubman and Pank) has an approximate 35% market share, compared to Specsavers’ 20% share.
Over the past few years, the two competitors have been engaged in a number of legal disputes over advertising campaigns. In the case at hand, Specsavers was concerned with Luxottica’s Accufit promotion; in particular, whether the use of the word ‘better’ in the tagline “Better Frames, Better Lenses, Better Fit” was in effect making a comparison to Specsavers’ goods and services.
Luxottica’s Accufit system advertising campaign promoted a sales tool that combined:
- a virtual mirror, which photographed a customer wearing a number of prospective frames and then displayed them to the customer side-by-side;
- a lens simulator, through which a customer can look to understand the different experience of various lens products (eg, single vision compared to bifocal lenses); and
- a fit sensor, which ensures the optical centre of the lens is precisely placed within the frame.
Specsavers alleged that three representations made in the course of the Accufit advertising campaign breached the Consumer Law.
Better frames, better lenses
Central to Luxottica’s advertising campaign was the slogan ‘Better Frames, Better Lenses, Better Fit’. Specsavers claimed that the overriding message was that the frames and lenses now available at Luxottica’s stores were of a superior or improved quality than those available previously or at Specsavers’ stores.
Luxottica’s advertising claimed that its Accufit system was available “in OPSMs everywhere”. Specsavers claimed that this representation was misleading on two grounds. First, there were a small number of OPSM stores to which the Accufit system was not deployed at the start of the campaign. Second, Specsavers claimed that mystery shoppers who they had sent to OPSM stores had not been offered full use of the Accufit system.
Another line from Luxottica’s ads was that: “Once upon a time, fitting your prescription into your lenses involved a ruler, a felt pen and a steady hand. Thanks to the Accufit Fit Sensor, that’s now obsolete.” Specsavers claimed that this representation implied that they and other opticians still fitted lenses in the manner described.
The Federal Court found that Specsavers had failed to establish misleading or deceptive conduct in relation to any of the three representations.
In regards to the ‘Better Frames, Better Lenses’ representation, the court held that such a representation had to be considered in light of the final part of the slogan (ie, ‘Better Fit’), especially when considering the design of much of the advertising material, which gave greater prominence to ‘Better Fit’ than ‘Better Frames’ and ‘Better Lenses’. The court accepted evidence that the overriding message of the advertisements was that Accufit system would result in the customer receiving better fitting glasses, and hence ‘better’ frames and lenses. Furthermore, in the alternative, the court considered the slogan to be mere puffery (ie, acceptable marketing spin and hype), as the terms were general and incapable of being proven correct or incorrect.
The availability representation was also rejected. The mystery shopper evidence was deemed to be insufficient to demonstrate the unavailability of the Accufit system, as the mystery shoppers had been given access to at least one part of it. Second, while there were three stores to which Accufit was not deployed at the start of the advertising campaign, the unavailability of the system at these stores was a mistake on the part of Luxottica and not a deliberate design or strategy. The court held that this inaccuracy in the advertising was inconsequential – especially given the fact that OPSM’s 348 other stores had the system available – and did not amount to misleading or deceptive conduct.
The ruler representation was also rejected, with the court holding that a reasonable consumer of optical products was unlikely to take the representation literally, especially considering the use of the words ‘once upon a time’, which the court felt gave the representation a fairytale character.
When considering whether an advertisement or marketing campaign is misleading or deceptive, the conduct must be viewed as a whole and in its full context. It is insufficient to consider part of a slogan or similar in isolation, rather than considering it within the scope of the whole advertisement.
Furthermore, parties should consider whether a hypothetical or reasonable member of the class of persons to whom the advertising is directed is likely to be misled or deceived by the representation. A degree of robustness is required when considering whether conduct is misleading or deceptive – the law does not intend to protect the extremely gullible or those who fail to take care of their own interests. Likewise, marketing and advertising hype and exaggerated claims are acceptable, but not if there is a definitive statement or consequence. For example, while “the best burgers you will ever taste” is ok, the claim that “our burgers have less fat that any of our competitors” is probably not.
Ideally, businesses should not have to suffer from small parts of their advertising campaigns being taken out of context and used by competitors as a basis for expensive litigation. The best thing to do is either to avoid making claims or to take care when making anything but the most general claims about a competitor’s goods and services, unless such claims can be substantiated.
Businesses and their advertising agencies can be held responsible for their advertising campaigns, whether by a competitor or by a regulator, including the Australian Competition and Consumer Commission. Timely advice should be sought on advertising campaigns, both at early concept development stages and at near-final production stages. Getting advice before the campaign goes live will assist in minimising risk and avoiding liability.
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