Online retailers, dark patterns & enforcement action
The Competition and Markets Authority (CMA) are taking enforcement action against online retailers for mis-marketing, dark patterns and online harms.
This article harks back to a topic I’ve touched on before – here’s what I wrote in August 2023: Do you use high pressure selling techniques online?
What are dark patterns?
‘Dark patterns’ describe online pressure selling techniques such as misleading discount claims and countdown timers.
The CMA are taking enforcement action against online retailers who use these misleading price claims and / or fake urgency claims to put pressure on potential buyers.
Discounting and Reference Pricing Principles
It was 1 August 2024 when the CMA published their new Discounting and Reference Pricing Principles: selling mattresses online.
Although the description in the title of the document refers to online mattress sales, the CMA introduction makes it clear that these principles relate to all online products where reference pricing and discounts are used.
The guidance is a very worthwhile read, and incudes well illustrated and practical examples.
I encourage anyone in the retail sector to consider the sales content of their website and social media spaces with reference to these principles.
It’s all consistent with the open letter the CMA published on 23/3/23, entitled: Urgency claims and price reduction claims: Compliance advice for online businesses.
This, too, is a very useful read, not least because it’s very short!
Emma Sleep
One area that’s now been under the CMA’s investigative gaze and enforcement action for some time are online sellers of mattresses, including, notably, the Emma Sleep Group. They are being asked – once again – to provide undertakings to correct their use of misleading claims and countdown timers.
On 25/10/24, the CMA appears to have lost patience, and have now escalated their existing enforcement action against the group, which includes:
Let’s call them all ‘Emma Sleep’.
They’ve consistently been using dark patterns of the type that tend to put pressure on online buyers, by making misleading discount claims and by using countdown timers.
The CMA have issued a press release, stating that Emma Sleep can still avoid the matter going to court by providing the undertakings the CMA have been pressing for.
This is a demonstration of how seriously the CMA takes this.
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Other companies in the sector have already given such an undertaking to the CMA, including SIMBA Sleep in August 2024.
Not just mattresses, not just discount claims
Discount claims and countdown timers for online mattress sales are not the only areas the CMA are investigating. They are also actively researching:
The CMA are also looking at broader online harms, such as green claims, particularly in the fashion industry, and have already successfully obtained undertakings from:
They are also investigating the FMCG sector (Fast Moving Consumer Goods) as well as ‘green’ heating and insulation products and the travel and transport sectors.
If this is relevant to your products or services, then, to help you get your marketing right in this area, the CMA has published a Green Claims Code.
Other dark patterns
The CMA have certainly been busy! They’re also investigating a broad range of sectors for misleading contracting and other breaches of consumer rights including the use of dark patterns, in sectors ranging through:
I mention these to reinforce the message that the CMA has a wide-ranging brief. Soon, they will also have greater powers…
Greater powers for the CMA
From April 2025, the CMA will have greater powers of sanctions, and will be able to directly fine firms that break consumer law. Fines can be up to 10% of the global turnover of the company concerned.
This change is as a result of the Digital Markets Competition and Consumer Act 2024.
What this means to you
You don’t have to be in the mattress sector or as big as Emma Sleep Group in order to come to the attention of the CMA, if your marketing practices transgress the consumer protections.
If you have any questions, please call me on 020 3609 8764. I’ll be happy to help. And you’ll be able to sleep more easily at night, knowing the CMA won’t need to be investigating your business.
Related reading
You might also like to read my recent article: Using social media influencers for your advertising campaigns