Exaggerations in advertising: permissible or misleading?

“The best coffee in the world.” “The strongest cleaning product on the market.” “Number 1 in customer satisfaction.” Advertising is full of claims like these, also known as ‘puffery claims’. But when is such a claim unacceptable, and when is it simply permissible advertising?

The answer lies in the distinction between misleading claims and puffery: permissible advertising exaggeration.

What is a ‘puffery claim’?

Puffery refers to exaggerated, often superlative statements in advertising that the average consumer does not perceive as verifiable factual claims, but as customary praise. These are claims that are so vague, general or obviously subjective that a consumer does not take them literally.

Examples include:

• “The best burger in town”
• “Unrivalled quality”
• “Number 1 in taste”

The key point is that such statements are not falsifiable: there is no objective standard by which to test them. In the right context, such statements are therefore regarded as permissible advertising hyperbole.

What is a misleading claim?

A claim is misleading if, due to its content, presentation or the omission of essential information, it may create a false impression in the consumer’s mind. This is the case, for example, if a claim contains factually incorrect information.

You can read more about misleading advertising in our article.

Where is the line between puffery and misleading advertising?

To determine whether a claim is permissible puffery or prohibited misleading advertising, the perspective of the average consumer is taken into account. This consumer understands that advertising is, by its very nature, promotional and often contains exaggerations. At the same time, this consumer is not exceptionally critical or observant.

Furthermore, claims must be assessed in their context: the nature of the product, the medium used, the wording and the circumstances in which the statement is made.

A useful rule of thumb is that an exaggerated statement may still be misleading if it is based on, or gives the impression of being based on, objectively verifiable facts. In that case, the statement quickly loses its character as puffery and must be factually correct in order not to be classified as misleading.

Examples:

• “Number 1 in customer satisfaction” may be puffery; “Number 1 in customer satisfaction according to independent research” requires substantiation.
• “The best burger in town” may be puffery; “The best-tested burger in town” is a factual claim that must be demonstrably true.
• “Great value” is vague and appears to be puffery; “The cheapest provider in the Netherlands” is specific and verifiable and requires substantiation.

Possible legal consequences

If it subsequently transpires that there is no puffery and you are unable to substantiate the claim (in good time), this may constitute misleading advertising. In that case, a ban on the use of the claim may be imposed, amongst other things. In addition, compensation may be payable to parties who have suffered loss as a result. There is also a risk of a fine from the ACM, and contracts entered into as a result of the misleading claim may (under certain circumstances) be set aside.

Questions?

Do you suspect that a competitor is engaging in misleading advertising? Are you unsure whether your own communications comply with the applicable rules? Or do you have other questions on this subject? Please contact one of our solicitors via email, by telephone or fill in the contact form for a no-obligation initial consultation. We would be happy to discuss this with you.