Deceptive ads: ASCI releases guidelines, govt to form task force

The ad regulator has released guidelines on dark patterns.

After consultation with e-commerce firms on online deceptive design patterns commonly known as 'dark patterns', the Advertising Standards Council of India (ASCI) released guidelines on June 15 for better compliance by online platforms.

The idea of putting a framework is to give greater clarity, said Manisha Kapoor, CEO and secretary general, ASCI.

"Any misleading ad practice under the law is regarded as a violation. But instead of fining people straight away, there is a dialogue for a common understanding of this (dark patterns) so that everyone is on the same page regarding what to do and what not to do. First, the idea is to educate and then if the government is not satisfied with compliance by companies then they (government) can start to penalise," she said.

Kapoor added that e-commerce platforms are aligned in terms of what kind of consumer harm they do and the mechanism they will have to put in to resolve this issue. "Advertising will also mean listings on a platform. They (e-commerce platforms) have to see whether pricing includes all taxes and which is displayed upfront and other such aspects. It will mean a change in the way some of these platforms are functioning. They (e-commerce platforms) will need to have work on these (dark patterns) in the interest of consumers."

E-commerce is the most impacted category and causes more harm to consumers in terms of more dark patterns in advertising, she said.

According to ASCI code, ads need to be honest, and not abuse the trust or lack of expertise of the consumer. The code requires ads to not mislead by omission, exaggeration, implication or ambiguity. To ensure that advertisements do not breach these aspects, the following guidelines are to be applied to digital advertising to address the issue of online deceptive design patterns.

Drip pricing: Quoted prices in advertisements and e-commerce sites must include non-optional taxes, duties, fees and charges that apply to all or most buyers so as to prevent drip pricing. For example, if a consumer orders a snack from an online food delivery platform where a price of Rs 100 is shown, but the final amount payable comes to Rs 175 as it additionally includes taxes, delivery fees, platform convenience fees and other such charges. If such charges are common for all or most consumers, they must be included in the displayed prices on the listing ad itself.

Bait and switch: When an ad or an element in the ad directly or indirectly implies one outcome based on the consumer's action, but instead serves an alternative outcome, the same would be considered misleading. For example, if a consumer may select a product offered at a certain price but is thereafter only able to access the same product at a higher price or if a platform is offering an attractive product and later revealing that it is out of stock and offers an alternative product.

False urgency: Stating or implying that quantities of a particular product or service, like airline seats available at a certain price are more limited than they actually are, would amount to misleading consumers.

Disguised ads: An advertisement that is of a similar format as editorial or organic content must clearly disclose that it is an ad. Examples could be influencer posts, paid reviews, and ads placed in a manner to appear like editorial content.

Kapoor said that during their discussion with e-commerce firms, there was a strong agreement on a self-regulatory mechanism.

"Department of Consumer Affairs will come up with a task force to look at the larger framework of dark patterns that goes beyond advertising. It is looking at putting up a self-regulatory framework in place and the e-commerce firms can sign up. But it is also suggesting the industry to set up their own guidelines."

While ASCI’s guidelines cover only advertising in digital media including e-commerce, airline, food delivery apps and websites, the Ministry of Consumer Affairs is looking at aspects like privacy under which platforms ask for more data or personal information than needed or nagging consumers with repeated notifications. ASCI is also working on these aspects, said Kapoor.

Along with this, the ad regulator is also working on misleading ads around sustainability and messages by organisations asking for charitable donations. "We are actively working on these two to three areas and all of these are in different stages of research, conversation and consultation," she said.

Kapoor also added that the Securities and Exchange Board of India's (SEBI) efforts on financial influencers misleading consumers is a positive step. "Every conversation on this and every step taken on this will increase compliance. But the influencer space is at a nascent stage and it is evolving, so there needs to be constant conversation," she said.