Spotlight ordered to halt using ‘Biggest Sale Ever’ over false advertising ruling

Spotlight has been ordered to halt the use of advertisements that have been determined as false advertising.

Spotlight’s “Biggest Sale Ever” has been deemed false advertising by the Advertising Standards Authority (ASA) after it upheld a customer complaint.

The decision by the ASA’s Complaints Board said the store’s website and in-store advertisements made an absolute claim “which had not been adequately substantiated”.

The complaint lodged by the customer argued advertisements that ran in January couldn’t be validated by customers as to whether they were true.

The website and in-store posters read: “On sale Thursday 2nd January – Tuesday 14th January 2025 SPOTLIGHT BIGGEST SALE EVER Continues 20-50% off a huge range.”

Spotlight argued that the sale period in question ran after its initial period (December 25 to January 1), which utilised advertisements with the language “Biggest Sale Ever”.

It believed that the claim was substantiated “because there were still more products at bigger discounts than any other sale advertised by Spotlight in the previous 12 months before the initial sale period”.

Spotlight confirmed that its Christmas period sales are always the biggest of the year in terms of depth of discounts and the number of products on sale.

In the Complaints Board’s consideration, the members considered principle two of the Advertising Standards Code, Truthful Presentation, which states advertisements must be truthful, balanced and not misleading.

The board agreed that on a review of the advertisement, consumers would believe Spotlight was continuing to run its biggest sale ever – and unanimously agreed the advertisements were misleading.

“The advertiser was making an absolute claim by stating its continued holiday sale was Spotlight’s ‘Biggest Sale Ever’ and therefore it needed to hold robust, quantifiable evidence to support this if challenged,” the ASA board said.

It acknowledged Spotlight’s argument that more products were on sale at larger discounts than in the previous 12 months before the initial sale period, but said “it was not sufficient to substantiate the ‘biggest sale ever’ claim”.

The board did clarify whether Spotlight’s advertisement could contain an element of hyperbole, which is permitted under the Advertising Standards Code.

However, because Spotlight compared the scale of the sale to all previous sales, this could not be permitted.

Therefore, it upheld the complaint as being in breach of principle two of the Advertising Standards Code and ordered any relevant advertisements not to be used again in their current form.

Spotlight was approached for comment by the Herald.

The chain retailer of fabrics, crafts and homewares filed its New Zealand annual earnings to June 30, 2024, on the Companies Office in January.

It declared after-tax profits of around $15.3 million, a 64.5% increase on the previous year.

It reported total revenue for the 2024 financial year of $183.5m, up from $176.6m in 2023.

The lift represented a return to normality for a company that experienced rapid profit growth during the Covid-19 pandemic and a subsequent correction.

Tom Raynel is a multimedia business journalist for the Herald, covering small business and retail.