In the past, when German courts dealt with Google AdWords, this almost always concerned brand bidding.
But even if still in many constellations, it cannot securely be said whether the booking of a brand of a competitor is permissible, the rulings regarding keyword advertising are decreasing. By contrast, an increasing number of judgments are concerned with the content of the advertisements themselves. Frequently committed errors can be avoided relatively easily. The most important fact is that AdWords displays are also advertising displays for which legal regulations must be observed.
In this article, we present the most frequent breaches of German law and the simplest strategies with which these can be avoided.
Even small text displays are advertising displays for which competition law is valid. Advertisements may not be deceptive. If a free service is offered in an ad, a free offer must be found on the landing page. This goes for AdWords displays as well as for banner and poster advertising. The claims must also not be deceptive or erroneous and an average addressee must not be misled by them.
Decisive for the evaluation of whether an ad is misleading is the moment in which the display is shown. Thus, always be aware of the accuracy and correctness of the offers in your advertising statements. And always bear in mind: The advertiser (and not Google) is always responsible for the displays!
Deadlines that are advertised should always be upheld. Thus, if you write "same-day delivery" in your advertisement, you must be able to offer and implement same-day delivery.
Limitations are permissible on the landing page only insofar as the average user would expect them. Thus, for example, it must be clear to every user that there are no Sunday deliveries, such that, in this case, it is sufficient to make the limitation clear on the landing page.
Figure 1: Delivery within 24 hours
If the advertisement is valid only under certain limitations, the advertiser is obligated to make this clear in the ad itself. Only if the average user who searches for the respective keyword will expect the particular limitations, is it sufficient to integrate these into the landing page. In any case, limitations should always be immediately visible on the landing page.
False information in the ad will also be considered unfair advertising. Caution is advised in particular to advertising with local product availability. The advertised goods must thus be available for a suitable time frame at the advertised price. The ad may therefore be delivered only as long it is somewhat sure that a potential customer, if he or she walks into the retail shop on the same or the following day, can also still buy the goods at the advertised price. The rules are even stricter for a link that leads directly into the advertiser's shop. If the advertised product is no longer available, the advertisement for it must no longer be delivered.
Figure 2: Advertising with number of hotels available and one discount price
In many industries, special laws demand that each advertisement contains clarifying notices. The most well-known notice is that regarding a doctor or pharmacist. But, in the automotive industry and many other industries, there is mandatory information that must be integrated into every advertisement.
In general, it is sufficient when the user can reach the mandatory text via a link. However, it must be indicated clearly and in suitable fashion that the mandatory information can be reached via a link. In addition, the link must lead to a website on which the user can read the mandatory text without further intermediary steps.
The inclusion of prices in AdWords ads is connected with risks. First of all, the advertised price should be immediately reachable on the landing page. It is, for example, misleading if prices are advertised that cannot be attained or can be attained only under completely unrealistic conditions. This applies in the particular instance when the ad is being displayed.
In a proviso, "As long as supplies lasts!" in print advertisement it can be permissible, but online this is not sufficient because the advertisement can be switched off without further ado and users will count on the availability of products and prices.
Special case "starting from price": In Google displays, the information of from-prices is permissible, but this is no free ticket for misleading advertising. If a hotel advertises with "double room from 89 Euros," this price must be able to be realized for a double room on the landing page – and not just on one Monday within eight weeks.
There is no general obligation to disclose prices in AdWords ads. If however you indicate a price to the consumer, this needs to be a total price that contains all taxes and additional costs. Only when there is a clearly recognizable B2B offer (for example, advertisement for an ERP software, but not ads for gastronomy articles, if the advertised items can also be used by private persons).
In B2C advertising, the advertiser is obligated to indicate whether shipping costs will arise and how high these will be. Here, it can be sufficient to list these transparently on the landing page.
The advertised price has to contain all fixed components. Even if a one-time payment must be made for a certain product, for example for a SIM card in an advertisement for mobile phones, this information must be integrated into an AdWords ad regardless of limited space.
If price reductions are advertised in AdWords ads, it should be made clear on the target page for which products in particular the discount applies and under which conditions the discount can actually be claimed.
However, information on the details in the Google ad itself is not necessary. An advertisement with a discount is also conceivable for campaigns if the price reduction is also correspondingly advertised on the target page. If the advertised discount is no longer available in the shop, the ad must no longer be displayed otherwise it will be anti-competitive.
In particular when booking brands of competitors, the question arises of whether the Google user would understand the discount information not as a comparison with the prices of the competitor. A combination of brand bidding and price deductions is therefore frequently risky under German law.
While the booking of brands of a competitor is generally permissible (warning: There are many exceptions), the use of brands in the display text is itself the reverse.
The use of a mark in the ad itself is a use of the brans as a mark which requires a justification. Such use is permissible, for example, if the advertiser is a reseller of the brand. Whoever is authorized as a retailer to use the brand for advertising products may also do this in AdWords displays. Less clear is the case when the use of the brand serves the delimitation of one's own services. But here, too, a permissible design is conceivable.
Display extensions can sometimes cause trouble.
Cost transparency must in particular be paid attention to in call extensions. If costly value-added numbers are involved, the costs arising must be displayed. Thus, the often-used notice that cell phone charges can deviate, is often not enough. Instead, a maximum amount per minute has to be indicated. Because there is generally insufficient space for this, using toll numbers is risky. Only free or numbers of local landlines are easy in this respect.
If location extensions are used, the information may – as always – not contain any errors. If an incorrect allocation is made, this may be anti-competitive. Because advertisers are responsible for the advertisements themselves, it is important to always double-check and test the displayed ads.
Figure 3: Inserted locations can be problematic if no retail shop exists at the address indicated
Especially when ratings are directly integrated into the ads, businesses may be tempted to create a better overall impression by self-evaluation. Fake evaluations are however not permitted! Moreover, such surreptitious advertising comes to light more often than suspected. Thus, don’t do it..
The long list of possible errors in the design of AdWords ads perhaps conveys the impression of substantial risks. If you make yourself aware, however, that Google ads are (like regular display ads) advertisements this relativizes the impression. In the end, the legal requirements must also be observed with context-based displays.
For agencies, this means pointing out to customers the corresponding risks and not blindly booking according to the guidelines of the seller. It is still more dangerous - and potentially with considerable risk - if the SEA agency creates the displays itself and when doing so oversees legal problems. Here, the agency must ask for information by the client if necessary. This goes in particular for advertising with prices that require close collaboration with the customer's e-commerce team.
The customers are also potentially liable and cannot evade this by referring to the agenciy instructed. In contrast: The customer is liable for possible competition law violations and is thus responsible for the agency having all necessary information.
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Published on 10/13/2017 by Martin Schirmbacher.
Dr. Martin Schirmbacher is a lawyer in the area of IT law at ”HÄRTING Rechtsanwälte”. His law firm specialises in advising companies that earn their money in e-commerce. Martin's team advises online shops and marketing agencies as well as software companies. He is author of the book ”Online-Marketing und Recht” (Online Marketing and Law).