ASA guidance on promotional marketing for subscription models
What guidance does the ASA provide regarding advertising for 'free trials' (and similar promotional techniques) for subscriptions?
The ASA is concerned that ads for 'free trials' or other such promotional subscription offers, which fail to make clear that the customer will be subsequently enrolled in an ongoing subscription arrangement, have the potential to mislead consumers.
A 'free trial' is where a consumer enrols in an ongoing payment arrangement to take advantage of a free trial product offer, test subscription, or other promotional benefit. Importantly, if a consumer does not cancel the trial, they become liable to make a payment, or ongoing payments, as part of the subscription plan to which they signed up, whether knowingly, or otherwise.
While not considered 'intrinsically problematic' by the ASA, these ads do manifest as problematic where a consumer unknowingly agrees to an ongoing payment plan, as a result of the ad:
- omitting significant conditions, or;
- not making significant conditions sufficiently clear for the consumer
Where the ad misleads in such a way, the ad itself is known as a "subscription trap".
To avoid misleading consumers, the ASA's guidance suggests that:
- an ad must make clear all significant conditions, where their omission would be likely to mislead; and
- any statement regarding the significant conditions should be sufficiently prominent that consumers are not likely to miss it - the positioning will vary depending on the individual ad and medium in which it appears.
Ads for a 'free trial' or promotional subscription offer should communicate all significant conditions likely to affect a consumer's decision to participate. Stating that 'T&C's apply' is not sufficient. More specifically, the ads must make clear:
- whether a paid subscription starts automatically after the trial, unless cancelled
- the extent of the financial commitment if the consumer does not cancel
- any other significant conditions, for example, significant costs to participate.
Placement of significant conditions
In relation to marketers' own websites, the Guidance suggests that significant conditions should be prominent, and distinct from other information. They should also immediately follow the most prominent references to the trial or offer. Significant conditions should be clear and legible in both size and clarity of font, as well as immediately visible; pop ups are not sufficient.
In relation to marketing communications, if they are significantly limited by time or space, the communication must include as much information about significant conditions as is practicable. The ASA has suggested that, in Twitter ads, marketers could include an image that clearly states the relevant conditions. The ASA considers that the following non-exhaustive list of communications will be unlikely to be considered significantly limited by time or space: emails, direct mailings, press and magazine ads, leaflets, posters and ads in social media not constrained by low character limits. Only in extreme circumstances will a media type be considered to be significantly restricted by time or space. Examples may include sponsored ads on search engine sites, and extremely small banner ads.
Why is this important?
The 'free trial' or promotional subscription model is frequently deployed as an effective hook to fish for new consumers. The guidance provides clarity for those circumstances where the ASA considers a 'subscription hook' to in fact be a 'subscription trap' for consumers.
Any practical tips?
Clarity is crucial; if the ad is a 'free trial' or a promotional subscription offer, include clear, simple and prominent wording to that effect. If you are unable to include significant conditions within an ad, you should perhaps consider whether the media type you wish to use is in fact suitable for this type of promotion.