Recently the National Advertising Division (NAD), as part of its routine monitoring program, evaluated whether certain claims made by Petco Animal Supplies, Inc. (Petco) in marketing and advertising materials for its “no artificial ingredients” advertising campaign were adequately substantiated. The NAD determined that Petco presented sufficient evidence to demonstrate that it is “setting a bold new standard for nutrition” and that it “will continue to evaluate and evolve [its] standards and assortment to take pet nutrition to new levels.” However, it recommended that Petco modify certain claims that it was removing “all” artificial ingredients or that there would be “no more artificials” in any of the pet food or treats it carries. The case provides some important guidance on the rules for making claims regarding “no artificial ingredients.”
Petco launched an initiative to remove artificial ingredients from its dog and cat foods and marketed that initiative heavily. Petco had adopted definitions of “Artificial Flavor,” “Artificial Color,” and “Artificial Preservative” that mimicked the FDA’s definitions and language, and expressly disclosed to consumers its definitions of these terms. Specifically, Petco disclosed that its definition of “artificial ingredients” did not include “synthetic vitamins, minerals and amino acids,” “substances that are derivatives or mimics of national compounds,” and “substances that may fall into categories outside the Petco definition of artificial colors.”
The NAD found that claims involving artificial ingredients that were phrased in absolute terms such as “all” or “no more” were contradicted by Petco’s own disclosures of that term, which qualified that it did not include certain “artificial colors, flavors and preservatives…at this time.” In addition to narrowly tailoring its claims to more accurately convey the more limited message that Petco had begun removing products containing certain artificial ingredients from its stores, the NAD asked Petco to clearly and conspicuously display its qualifying disclosures for “artificial ingredients” in close proximity to its claims of removing artificial ingredients, rather than being “solely relegated to the linked full list of artificial ingredients.”
The NAD also disagreed with Petco’s contention that the claims “no more nasties” and “bye bye bad stuff” with respect to certain artificial ingredients constitute puffery. Notwithstanding the playful phrasing, consumers would still take away a message about the benefit or harms of the artificial ingredients Petco was purporting to exclude from its sales. Since Petco did not submit evidence comparing the health of pet food containing artificial ingredients with those that do not, or otherwise show that such ingredients are, in fact, “bad” for pets, the NAD recommended that Petco discontinue its characterization of artificial ingredients contained in other pet foods or those carried by its competitors as “nasties” or “bad stuff,” and discontinue the depiction of “ash-canning” such pet foods in its video advertisements.
Petco was also advised to modify some of the hyperlinks to its “Better Nutrition” page and discontinue claims that as a result of its initiative to remove artificial ingredients from its stores, Petco was providing “better nutrition.” Although the hyperlink labels were found to comply with the FTC’s Dot Com Disclosures guidelines, the NAD took issue with the use of certain “no more artificials”-related claims on in-store materials and internet advertisements that direct consumers to the Better Nutrition page through links labeled “*learn more at Petco.com/betternutrition,” or “*learn more on our Better Nutrition page.” These labels did not adequately inform consumers of material information to follow, such as the list of specific ingredients that were removed from stores, the fact that Petco created the list of ingredients from FDA and Association of American Feed Control Officials (AAFCO) guidance, and qualifications that Petco had removed many, but not all, artificial ingredients. In addition to making specific formatting changes to the “Better Nutrition” landing page, the NAD recommended that Petco modify the disclosure labels and hyperlinks to better align with those appearing on its nutrition page to clearly indicate to the consumer the nature of information to be found behind the link.
The NAD emphasized that nothing in its ruling precludes Petco from truthfully stating the intent of its campaign and accurately communicating that it is listening to and responding to consumer preferences and concerns by advertising through its ongoing initiative. Petco “respectfully disagreed” with certain findings related to implied takeaways but agreed to adhere to the NAD’s recommendations.
The Petco ruling serves as an important reminder to advertisers in a number of respects. Even when a company sets its own standard or definition for a characteristic of its products, it should clearly disclose any qualifying information and avoid phrasing claims based on these definitions in absolute terms at the risk of being overbroad, and therefore misleading. And while advertisers may rely on placing material disclosures on separate landing pages, the hyperlink label must adequately inform consumers about the material information, such as why the claim is qualified or the nature of the disclosure. Finally, advertisers are reminded of the fine line between characterizations that constitute humorous puffery and those that are likely to suggest the product is comparatively better in a measurable way.