In Too Many Instances, a ‘Sale’ Really Isn’t
For years, advertising sale prices--as in “70% Off!” and “Regular price $150, now on sale for $79.99!”--has been the sure-fire way to draw a crowd.
It can also be meaningless, if there’s no real price reduction involved (as sale implies), because the so-called regular price really wasn’t. Maybe the goods never sold for that. Maybe they only bore that price the first week. Maybe their original tag had the regular price already crossed out and the sale price below.
Unfortunately, it’s a popular gambit, particularly with today’s department stores, which can hardly maintain full retail prices in a day of discounting and off-pricing. And it’s no more trustworthy, in spite of the little litany of clarifications and disclaimers commonly added now beneath the hype: “Regular and original prices are offering prices only and may not have resulted in sales,” or “Advertised merchandise may be available at sale prices in upcoming sale events.”
What does it mean, this magic language? That things never sold at the higher price, whether they were honestly overpriced or inflated for advertising purposes? That the advertised sale price is often the ordinary price, with a typical retail markup built in, and--don’t bother rushing in--the stuff may be regularly, continually and always on sale.
“The fine print,” says Herschel Elkins, California’s assistant attorney general in charge of consumer protection, “seems to be saying this isn’t really a ‘sale.’ ”
Nobody said the magic language had to be added, though this is a field full of suggestions and official “guidelines.” For several decades, the standing commandments have been the Federal Trade Commission’s 1964 guides against deceptive pricing, including “deceptive comparisons” with a “fictitious higher price.” Proof that a former price was genuine would require “substantial sales” or a “reasonably substantial period of time” during which the product was offered at that price.
But the FTC gradually stopped bringing price advertising cases--a third of its activity before 1970. The higher priority, says Steven Baker, FTC regional director in Chicago, is deception in health and safety and product performance claims, against which “you can’t protect yourself.”
Some states and municipalities may have their own regulations, defining regular price, for example, even more specifically in terms of the required number of sales or number of days. Others have filed suits under their general laws against deceptive advertising: New York’s attorney general took on Sears, Roebuck & Co. for such sale price advertising, and Colorado sued May Department Stores.
Given the variation, a Council of Better Business Bureaus task force of retailers has drafted guidelines, intended for adoption nationwide. Generally following FTC guidelines on sale-price advertising, with somewhat different terms and language, they are already criticized by industry and the FTC as too restrictive and by consumer protectors as too permissive.
There has always been some reluctance to be too strict and confining in setting such terms because comparative price advertising, in the FTC’s words, “tends to enhance competition and lower prices.” There’s also some reluctance to pursue apparent offenders, because investigation takes days or months of following ads and prices, says Elkins, and sales records are difficult to get.
Stores, therefore, are fairly free to use the word sale as they will, adding the magic language, just in case, as protection against any later accusations of deception. One Los Angeles department store, for example, recently advertised gold and gemstone earrings at $699 apiece, marked down from “regular” prices of $2,600-$3,200, when the earrings weren’t even brought into some stores until the week of the sale.
But the ads had magic language: “Regular prices do not necessarily reflect actual sales”--an understandable statement under the circumstances, but hardly one proving a 75% saving. Indeed, the merchant claimed to have taken the line from another store’s ads without looking into what it meant.
Some stores are a lot more specific but not necessarily more informative. Take the one that carefully explains that its regular price is what applied “before the sale” and will apply again after the sale, while an original price is one that applied the previous season, may have undergone several markdowns and will never apply again.
This is not easy to follow. It may be a sincere attempt at true disclosure. It may also, like other magic language, be implying great savings without proving anything. Who knows how those regular and original prices are set, and with what intent? Who knows how long tomorrow’s higher price will prevail, and if it’s any more “regular” than yesterday’s?
Retailers may use fine-print disclaimers just “to get them off the hook if they get into court,” says Joel Windman, attorney for the industry-supported Jewelers Vigilance Committee in New York. “If they say it like it is, they shouldn’t need disclaimers.”
Nor should the consumer, for whom disclaimers are a tip-off that comparison shopping is still necessary. The value of any price must be weighed against other prevailing prices, not against former prices, real or fictitious. “The most important thing,” says the FTC’s Baker, “is what it will cost you now.”
