MSRP - Reference Prices

The Manufacturer’s Suggested Retail Price, a type of Reference Price, (and all other aspects of a listing) must be truthful and not misleading.  Merchants are not required to provide a value for the MSRP Field. If Merchants choose to provide a value for the MSRP Field (a “Reference Price”), each Reference Price must comply with the Product Reference Price Policy. Use of a Reference Price in a listing is not required, but can be done at the merchant’s option.  Wish users will be advised that: (i) the Reference Price in the MSRP field is provided by the merchant; (ii) the Reference Price should comply with the Product Reference Price Policy; and (iii) to report Reference Prices that do not appear to comply with the Product Reference Price Policy.

The Product Reference Price Policy allows the following:

1. Use of a Reference Price for an identical item if the price: (i) was recently used by the merchant; (ii) was used for a reasonable length of time; and (iii) merchant made sales at that price .

2. Use of Reference Price that is an MSRP or List Price that was generated by the manufacturer.

• Substantiation – Each merchant is responsible for having a reasonable basis for making claims about a product, including about its price.  This generally means that you should have evidence of any Reference Price posted. We recommend evidence of use of a price (i.e. offers or listings) as well as evidence of sales at the Reference Price. If a complaint about the truth or accuracy of a Reference Price in the MSRP field arises, the merchant that posted it may be required to present evidence supporting the Reference Price.

Examples:

1) Merchant A lists an item with an MSRP.  However, merchant A has never listed or sold the item at the MSRP.  Merchant A should not use the MSRP as a Reference Price, because there is no reasonable basis for making this claim (e.g. no evidence that the MSRP was ever the list or sale price).

2) Merchant B listed and sold an item for price x for the last 3 months.  Merchant B finds a new supplier for the same item and lowers his costs. Merchant B chooses to pass the savings on to customers and lists the item at a new, lower price of y.  Merchant B may compare the new price (y) with the old price (x) because the old price was: recently used; for a reasonable length of time; and sales were made at that price. Merchant B should retain evidence of sales at price x.

3) Merchant B from the example above would like to continue comparing the new price (y) with the price (x) 8 months after Merchant B changed the price.  Merchant B should not use price x as a comparison because it is now 8 months old.  

4) Merchant C receives a supply of product from the manufacturer, including documents showing the manufacturer’s suggested retail price of X.  Merchant C may use X as a Reference Price for a reasonable period of time, because it is a documented price from the manufacturer.

The laws and rules for reference prices may differ from one country to another, but the UK’s Ad Standards Authority has a helpful guide.

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