The Committee of Advertising Practice (“CAP”) alongside the UK’s advertising watchdog – the Advertising Standards Authority (“ASA”) – have published new guidance (the “Guidance”) aimed at ensuring in-game and in-app purchases are marketed responsibly by advertisers.

The Guidance was brought in with the aim of protecting consumers, following increased concerns that ambiguous in-game and in-app advertising has misled vulnerable (and often young) consumers, to their detriment. The Guidance mainly focuses on the issues listed below. 

Scope

• The Guidance clarifies that whilst it applies to all forms of in-game advertising and purchases, there are some areas which fall out of scope. As the implementation of purchase mechanics varies from game to game, any consideration of remit will be on a case-by-case basis.
  
  
• When a virtual currency can only be obtained in a real-world transaction, the digital storefront and any inducements to purchase items from it (including console or platform-based storefronts) will be considered advertising for the purposes of the CAP Code.
  
  
• However, in-game storefronts using virtual currency that can be earned in-game (e.g. via gameplay) as well as purchased, are considered an in-game resource and therefore very unlikely to be considered advertising for the purpose of the CAP Code.

Pricing of in-game purchases

• Misleading pricing. Advertisers are not to mislead consumers by pricing in-game purchases ambiguously or obscuring key details relevant to the purchase. This includes marketing communications being presented in an unclear or untimely manner. The value of an item should always be clear to the consumer, and in cases where virtual currencies are used but fall within the remit of the CAP Code, the real-world price should be easily determinable. If there are ways to gain the virtual currency that do not involve purchasing it directly with real-world money, (e.g. through gameplay), this should be stated clearly in the storefront.
  
  
• Bundling. Bundles are a key focus too. Where consumers can buy bundles of virtual currency, the overall cost of the currency must be clear, while potentially misleading claims such as ‘cheapest’ should relate to the overall cost of the bundle. Conversely ‘best value’ claims should only be made in relation to the cost per unit, not the overall cost of the bundle. This becomes particularly relevant when price-per-unit varies according to the size and price of the bundle (e.g. 100 credits for £5 and 200 for £7).
  
  
• Odd-pricing. The concept of ‘odd-pricing’ is also referenced. This is where the increments of real-world currency do not match the virtual currency prices for items, resulting in consumers having to spend more than is necessary (because it’s difficult for consumers to work out what they need to spend on virtual currency to purchase a specific item). Information about the real-world cost of virtual currency bundles should be made clear to consumers in any external advertisements. A footnote such as “Minimum currency purchase is X” is likely to be sufficient.

Presentation of in-game purchases

• Urgency. In-game purchasing and advertising operates within a niche context of regulation. Advertising should therefore be tailored to the higher potential of consumers who may be more vulnerable to time-limited or chance-based purchasing. Elements of urgency accompany many in-gameplay purchasing options as a result of the urgency that surrounds immersive gameplay itself. However, marketing messages should not place the consumer in an stressful environment, and should avoid short countdown timers, implications that a purchase will lead to success, complex offers or options which involve significant sums of money.
  
  
• Loot boxes. Where gameplay involves random-item purchasing (commonly known as loot boxes), marketers should not mislead consumers about the chances of receiving rare items. An example would be a suggestion that the next purchase will result in a specific or rare item, or, where the probability of receiving an item does not vary with multiple purchases, claiming or implying that the next purchase has an increased likelihood of obtaining rare/specific items. Where the outcome is based on chance rather than skill, suggestions that the player almost obtained a rare/specific item are also unlikely to be acceptable.
  
  
• Time limited offers. Similarly, time limited offers should only be marketed as such when they are not available later. Advertisers should take care not to imply that an item is only available for a specific time or through a specific purchase route if it will later be made available again or more generally.

Advertisement featuring in-game purchased content

• Game progression contingent on in-app purchases. Consumers should be made aware ahead of purchasing a game or app whether in-game/in-app purchasing is a key part of advancing within the game or app. Advertisements should thus make clear all circumstances where a game or app requires further in-game purchases, and whether this also includes random-item purchasing. The advertisement outlining this message should be easily accessible and straightforward to interpret by consumers. Whilst not a requirement, marketers are encouraged to provide as much detail as possible about the type of in-game purchasing required.
  
  
• Ads featuring gameplay. For any advertisement that features gameplay, a balance should be struck in terms of highlighting which parts of the advertised gameplay require further in-game purchases and which are included in the basic game. Advertisers should not give the impression that all gameplay shown is free if that is not the case. Additionally, the advertisement should not imply that all content will be readily available from the basic game if significant portions require in-game purchases. All advertisements should be representative of the game itself – if images, sounds or features of gameplay are not to be found within the game, this should be highlighted clearly to the consumer.

In conclusion, the ASA has recognised that for some advertisers, changes to in-game content may be required, and the ASA states that it is willing to deal with complaints on an informal footing for a period of six months for in-game content and three months for all other ads covered by the guidance, to allow industry to effectively implement changes. Following this honeymoon period, the ASA will return to their regular procedures in determining whether to formally pursue cases.

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For more insights from the world of gaming law, plus consumer and retail law, get in touch with Calum Murray and Tom Sutherland.