Some skincare brand owners put all their energy into complying with labelling regulations, but consumer protection laws are another critical area of legislation to understand.
They exist to make sure you do right by your customers, i.e. that they get what they pay for and they aren't misled.
The Australian Competition and Consumer Commission (the ACCC) is very active in monitoring and enforcement, and customers can easily make complaints, so it’s essential you’ve got your bases covered.
I was super excited to hear that the ACCC recently released a new guide to Australia’s competition and consumer laws (I love it when regulators try to make our lives easier!).
Hot off the press is their 36-page guide to Small business and the Competition and Consumer Act: Your rights and responsibilities.
I’ve had a read and give it a big thumbs up It’s an excellent, easy-to-read overview of what you need to know.
Make sure you check it out.
It's inspired me to share some tips on doing right by your customers and complying with the Australian Consumer Law (some of which are based on compliance faux pas I've seen in the past):
1. Have evidence to back up your claims
This might seem like an obvious one, but you need to make sure that you can substantiate any marketing claims you make, e.g. on your labels, website and advertising. This means you need to have evidence that can prove that the claim is not false and misleading. In some cases, e.g. if you are using organic ingredients in your products and want to claim something like 'made with organic ingredients' or 'contains 95% organic ingredients', you'll need to obtain the relevant documentation (like proof of organic certification) from your supplier.
2. Display the total price of your products
Did you know you have to display the total price of your product to your potential customers including any GST and other costs? Occasionally I'll see a brand that lists the prices ex-GST, and it's not until you get to the checkout that the price increases to include GST - this is not allowed. Make sure you display the total price from the get-go. The Australian Consumer Law (the ACL) includes a bunch of other pricing-related requirements to prevent customers being misled, which are discussed in their new guide I've mentioned above.
3. Don't say 'returns only accepted within X days'
One of the things I check in my E-Commerce Audits is skincare brand owners' returns and refund policies. I often see statements such as 'returns not accepted' or 'returns must be requested within X days', e.g. 7 days, 30 days, etc. Blanket statements such as these - i.e. that don't differentiate between change of mind versus faulty products - do not comply with the Australian Consumer Law due to the consumer guarantees it provides. One of these consumer guarantees is whether a product is of an acceptable quality or not. As an example, if a product went mouldy due to lack of or inadequate preservation AFTER the specified number of days in your refund policy, e.g. if it spoiled after 3 months (and before the use by date / period after opening period), the customer is well within their rights to request a refund or replacement. Instead, your refund policy could state that all refund requests will be handled in accordance with the Australian Consumer Law provisions, and have separate statements around how you handle refund requests for change of mind versus a product that doesn't meet the consumer guarantees.
4. Don't use certification body logos without permission
Yes, I know this seems like another obvious one, but again it's something I've seen before. You can't use any certification body logos, e.g. Leaping Bunny, Certified Vegan, COSMOS, Australian Made, unless you've gone through the process to be certified and paid $$$ to use it. It also means you can't use any logos that look similar to any of them. If you're getting a graphic designer to mock up some 'unofficial' logos, do a quick Google search to make sure they don't look too much like any of the official certification bodies. If you think it's similar enough that a customer could be confused, it's likely it could be classified as misleading and deceptive conduct - another big no-no in the world of consumer protection laws.
At the end of the day, consumer laws are there to protect our valued customers. We want to keep our customers happy so they keep coming back to us (and also to avoid unwanted regulator attention) - so make sure you're up-to-speed with them!
---Pssst: Did you know I offer Marketing Claims Reviews, which can help you avoid making false and misleading claims?
- Can I say my product is natural and/or organic?
- Can I make any country of origin claims, e.g. Made in Australia or Product of Australia?
- Can I make a certain claim about product performance or efficacy?
- Have I inadvertently made any false or misleading claims in my promotional material?
- Have I made any illegal therapeutic claims about a cosmetic product?
- Do I have enough evidence to adequately substantiate the claim/s if requested by the ACCC?
If you have any questions, feel free to ask them below or in the Natural Skincare Makers Australia group on Facebook.