Fake Sale Prices: What Counts as a Real "Was" Price

A "was" price is a fair comparison only if it is the actual price at which the product was offered to the public on a regular basis for a reasonably substantial period of time Source [1]. If the higher price was inflated only so a big cut could be advertised, the FTC's pricing guides call the bargain a false one Source [1].

This is general information, not legal advice. It is based on the FTC's Guides Against Deceptive Pricing Source [1], and it does not cover state laws.

An offer post with its end date goes into the campaign calendar only after a person on the brand's team approves the piece Source [2].

What makes a "was" price real

The guides start from the common bargain ad: a reduction from the advertiser's own former price. If that former price was a genuine one, offered openly and regularly for a reasonably substantial period, the comparison is legitimate and the bargain is a true one Source [1]. If the former price was artificial and inflated to allow a later large reduction, the "bargain" is a false one, and the "reduced" price is probably just the seller's regular price Source [1].

A price is not fictitious just because nothing sold at it. The guides ask that it was openly and actively offered, in the recent regular course of business, honestly and in good faith Source [1].

The guides give a plain example. A shop lists a pen at an inflated price for a few days, knowing it will sell almost none at that price, then "cuts" it back to its usual price and advertises "Were" and "Now" prices. The guides call that claim obviously false Source [1].

Other fictitious comparisons they name Source [1]:

• A price at which the product was never offered.
• A price not used in the regular course of business, or used only in a remote past without saying so.
• A price not openly offered to the public, or kept only briefly before being cut.

When "Sale" does not name a price

If an ad only says "Sale", the guides still say the reduction should not be so small that it is meaningless. In their words, a claim of "Reduced to $9.99" when the former price was $10 misleads, because shoppers will expect a much greater reduction than a nominal one Source [1].

Comparing with other stores

A claim like "Price elsewhere" or "Retail Value" must rest on fact. Before saying you sell below prices in your area, be reasonably sure the higher price is close to the price at which substantial sales are made there Source [1]. In the guides' example, a "Retail Value" quoted from a few small outlets is deceptive when the larger outlets charge about what the advertiser charges Source [1].

The same goes for a manufacturer's suggested price. A list price is not fictitious if substantial sales are made at it in the advertiser's trade area, but a list price well above the highest price with substantial sales risks misleading shoppers Source [1].

"Buy one, get one free" and other conditional deals

When an offer says "free" or "half price", the guides say all the terms and conditions should be made clear at the outset Source [1]. If the seller raises the regular price of the item you must buy, or cuts its quantity or quality, the shopper may be deceived Source [1].

Other tricks the guides name

The guides add that advertisers should not offer an advance sale when they do not in good faith expect to raise the price later, or make a "limited" offer that is not limited Source [1]. They also should not offer seconds or imperfect goods at a reduced price without saying the higher comparison price refers to perfect goods Source [1].

A check before you post a sale

What follows is our own routine, and the guides do not prescribe it.

1. Keep a simple price log: the date, the price and where it was offered.
2. Write the "was" price in your post only if the log shows you really charged it, openly, for a substantial stretch.
3. If you cannot show that, post the new price on its own and skip the comparison.
4. State the end date and the terms in the post itself.
5. If an influencer shares your sale, the post may also need a disclosure. See our guide to the FTC influencer guidelines.

Checking a sale post means comparing the \"was\" price in the post with the log (the date, the price and where it was offered) and look for the end date and the terms in the text. With Autonomah the team can approve a piece, request a change or reject it, and a person on the brand's team makes that call for every piece Source [2].

How Autonomah does it

Autonomah is an artificial creative and advertising brain that thinks, creates and publishes each brand's advertising Source [2]. The team gets one notice a week listing the pieces waiting for a decision, and decides on each one Source [2]. The price on a post is a fact your team checks against its own records, and the home page shows how a piece reaches your team for approval.

Frequently asked questions

Is it illegal to do fake discounts?

The guides describe a fictitious former price as a false bargain and the resulting claim as deceptive Source [1]. They are guides and not a statute. Their stated authority is the FTC Act, sections 5 and 6, at 15 U.S.C. 45 and 46 Source [1]. State law may add its own rules, and we did not review it.

What is an example of deceptive pricing?

The guides' own example is the pen. A seller prices it high for a few days, then returns it to the usual price and advertises the drop as a bargain Source [1]. Another is a "Retail Value" taken from a few small outlets when the larger outlets charge about the advertiser's price Source [1].