On 20 September 2021, the Committee of Advertising Practice (CAP) and the Broadcast Committee of Advertising Practice (BCAP) published new guidance on advertising in-game purchases (in apps and video games) and the way in which they should be marketed in order to prevent harm or consumer detriment (the Guidance). The Guidance was published together with a statement to explain how the CAP Code and the BCAP Code (the Codes) apply to the marketing of in-game purchases in apps and video games (the Statement). These publications follow the related public consultation, which was issued on 5 November 2020 and closed on 28 January 2021 (the Consultation).
The interactive entertainment sector has been, and continues to be, extremely innovative when it comes to findings ways to bring consumers a more immersive experience and rewards for investing time into games. The Guidance is intended to improve consumers' ability to understand how much real-world money they are spending on in-game items and is likely to be welcomed by consumers if it has the desired outcome. Advertisers and games publishers incorporating in-game advertisements should take note of the Guidance and make any necessary adjustments to their ads and in-game content to ensure consumers can make more informed decisions about their purchases.
The Codes already contain rules prohibiting harmful and misleading advertising generally, so, following the Consultation, CAP and BCAP determined that further rules specific to the interactive entertainment sector were not necessary. Instead, CAP and BCAP determined that formal guidance, which explains what responsible and truthful marketing looks like for in-game purchasing, would be the most effective way forward.
The Statement directs that existing ads should be changed or withdrawn as soon as possible. However, in recognition that changes to in-game content may be required, the Advertising Standards Authority (ASA) will assess complaints informally for a period of six months for in-game content and three months for all other ads covered by the guidance, to allow the interactive entertainment industry to implement changes effectively. After this period, the ASA will revert to its standard enforcement procedures in determining whether to take action. CAP and BCAP are mindful of the need to avoid unintended consequences and have therefore indicated that the Guidance will be subject to review after 12 months of its publication.
The Guidance applies to all forms of advertising for in-game items, including advertisements for games that feature in-game purchasing. In relation to in-game 'storefronts' and inducements to purchase, the Guidance makes clear that storefronts selling virtual currency for real money, and console or platform-based storefronts that use a credits system to purchase games or other digital items and subscriptions, will fall within the scope of the CAP Code. A distinction is then made between: (1) storefronts and inducements to purchase (such as pop up messages offering extra lives in exchange for virtual currency) where items and/or virtual currency can only be purchased using real money on the one hand, and (2) storefronts and inducements to purchase where the virtual currency can be earned in the game as well as purchased using real money. The former are considered advertisements for the purpose of the CAP Code, but the latter are not.
The Guidance goes on to address the following three areas:
Pricing of in-game purchases
The Codes prevent advertisers from misleading customers by omitting or obscuring material information, including presenting marketing communications in an unclear, unintelligible, ambiguous or untimely manner (CAP Rule 3.3 and BCAP Rule 3.2). The Guidance recognises that a statement of the price of an item in virtual currency may not fulfil the 'material information' requirement and sets out the following practices for advertisers to follow to mitigate against obscuring the price of an in-game item:
- Where consumers can buy 'bundles' of virtual currency (i.e. where the price-per-unit varies according to the size and price of the bundle), claims such as 'best value' should only be used in a context that makes clear that this relates to the cost-per-unit price and not the overall cost of the bundle. 'Cheapest' should only relate to the overall price of a bundle and not the price-per-unit.
- The value of items available through a storefront that falls within the remit of the Codes should be clear. Consumers should be able to determine easily the equivalent real-world price for the item and/or whether they will have to spend real money on more virtual currency to obtain it. This practice will prevent consumers having to calculate manually the exchange rate for virtual currencies. The Guidance suggests that a clear statement of the virtual currency price, together with an easily accessible, clear or otherwise intuitive signpost to how much of the virtual currency the player currently holds and/or the storefront area where the virtual currency can be purchased, will fulfil the minimum requirement. Marketers should also take care not to imply that virtual currency or in-game items may only be acquired for real money if they can also be accessed by other means (e.g. through wait timers or free-to-play game mechanics);
- Odd-pricing occurs when the increments of currency bundles do not match the increments of the virtual currency price for items. This practice has attracted criticism as players must purchase more virtual currency than they need to spend on items (e.g. an item costs 100 virtual coins, but players cannot purchase 100 virtual coins for £1, rather players must purchase 500 virtual coins for £5). In advertisements outside a game, and where a virtual currency price is stated for an in-game item, if odd-pricing applies, then the advertiser should include sufficient information about the costs of the currency bundles. This will allow consumers to determine the real-world cost of the item when the virtual currency purchase is taken into account (e.g. by stating in a footnote the minimum virtual currency purchase price). This is in contrast to storefronts and product pages where customers have immediate access to information about the amount of virtual currency they already own, in which case it is likely to be sufficient to display prominently the costs of different currency bundles on the currency purchase page.
- Where a variety of items are sold as a bundle at a discount, advertisers should ensure that any statements around price savings are representative of the savings actually experienced by players and not inflate such claims by calculating them on the basis of the most expensive price-per-unit equivalent.
Presentation of in-game purchases
The marketing of in-game purchasing should be sensitive to contexts where the potential for being misled is higher and take account of players who may be vulnerable to time-limited or chance-based purchasing. In relation to in-game items (including virtual currencies) purchased for real money, or with virtual currencies that can only be purchased using real money, the Guidance sets out the following advice:
- For ads within gameplay, marketers should avoid the use of mechanics that may place undue pressure on players and prevent them from making an informed choice or mislead them, such as short countdown timers, implications that a purchase will lead to success, complex offers and significant sums of money.
- Where games include loot boxes or random-item purchasing, messaging for these items should not mislead customers about the chances of receiving a rare/specific item. It is unlikely to be acceptable to do any of the following: suggesting (directly or implicitly) that the next purchase will result in a rare/specific item; claiming or implying that the next purchase is more likely to obtain the rare/specific items (where the probability of receiving an item does not vary with multiple purchases); and suggesting that the player almost obtained a rare/specific item (where the outcome is based on chance rather than skill).
- If an offer is not genuinely time-limited (e.g. the item will later be made available again more generally), then marketers should take care not to imply that an item is only available for a specific time or through a specific purchase route.
Advertising games that feature in-game purchasing
The Guidance states that advertisers should make clear to consumers if the game includes in-game purchasing and (if applicable) random-item purchasing. This information should be easily accessible and straightforward to find. References to random-item purchasing should be immediately next to (or part of) information about in-game purchasing more generally and the use of PEGI labelling is likely to be considered an appropriate means of disclosing such information.
While not required to do so, advertisers are also encouraged to provide further information about the type of in-game purchasing that the game involves (e.g. whether purchasing is for cosmetic items, 'big ticket' purchases and/or functional (in-play) features).
In addition, where gaming ads give an overview of the whole game and include elements that are not immediately available to players (i.e. which require in-game purchases), advertisers should not imply that such items are included in the 'basic' game. When advertising features that consumers may 'unlock' through gameplay, advertisers should not give the impression that these items are available for free or easily, or can immediately be obtained through standard play. Content requiring purchase or a significant investment of game time should not be presented as easily or quickly obtainable through standard play (if such content is featured, it should be made clear that it is only available unlocked or if paid-for, including if it is only available through random-item purchase). Generally, advertisers should seek to ensure that the gameplay shown in the ad is representative of the game itself.
If you need any assistance in assessing whether your advertising practices comply with the Guidance, please contact your usual member of the Innovation department.