Home Depot to Pull “Rated #1” Claims For Behr Paint

By: STEPHEN R. BERGERSON

July 2008

NAD has asked Home Depot to discontinue superiority claims for its Behr interior paint in newspaper ads, internet ads, in-store banners and television and radio advertisements. The challenged claims were:

“Rated #1 by a leading independent consumer publication.”

“Rated #1 by an independent national study.”

“Rated #1 four years in a row.”

“Rated #1 for coverage. And rated #1 for high-traffic areas.”

Background:

Consumer Reports magazine had rated Behr Premium Plus interior paint number one for four years in a row, until early 2008, when Behr lost the ranking.

The advertiser subsequently replaced its “consumer publication” claim with a “Rated #1 by an independent national study” claim, and continued to run the “four years in a row” and #1 coverage and high traffic claims.

Challenger’s Position

I.  The “Rated #1 by a leading independent consumer publication” Claim.

The challenger asserted that the “rated #1 by a leading independent consumer publication” claim implied that the Consumer Reports rating was current, which was no longer the case.

Indeed, the challenger noted that the 2008 Consumer Reports rated Behr #2 in the “flat” paints category, #5 in the “low-luster” category, and #2 in the “semi-gloss” category, so Behr was not rated #1 in any category, much less “overall.”

The challenger also asserted that because latest Consumer Reports’ rankings no longer ranked Behr Paint as number one, the “#1 for four years in a row” claim was misleading because it implied that the fourth year included the current year.

The challenger cited NAD precedents holding that claims based on obsolete data are misleading unless the ad so discloses. For example, an NAD decision in Grey Goose1 held that even detailed, factually accurate representations may be misleading if subsequent testing proves the competitor’s product is better than advertised. The challenger asserted that this applies not only to when a product has become more highly ranked in a more recent ranking, but also when the product’s rank has fallen. The challenger maintained that the advertiser may not use old data when it can’t be reconciled with more up-to-date data.2 

Likewise, the competitor cited an NAD decision held that a party making a sales superiority claim must retain current sales data to ensure continued accuracy of the claim.3  The challenger argued that the same standard should apply to product ranking claims and at the very least that an advertiser making a “ranked #1” claim that covers a specific period of time must conspicuously disclose both the source and time period it covers.4

II.  The “Rated #1 by an independent national study” and “Rated #1 four years in a row” Claims.

The challenger argued that the test methodology which the lab used to rank the paints was flawed. For example, the challenger argued that testing should have weighted the “hiding/one coat coverage” factor more heavily than it did, since that is what consumers consider most important when buying paint. The challenger noted that the report assigned only a 10% weight to this factor, but the weight should have been closer to 50%. The challenger also contended that the “touch up” capability (i.e., ability to match existing paint when performing “touch-ups”) was weighted too heavily, because it is less likely to affect a consumer’s choice.

The challenger took special issue with the 2007 test results, noting that Stainmaster paint, which the lab rated number two in the third quarter with a score of 97, was not rated at all in the first quarter. The advertiser’s product was rated a 97.5 in the third quarter but only a 95.0 in the first quarter which, if averaged, would have led to a score of 96.25 (which would have been below Stainmaster’s 97 rating). But, instead of averaging its two scores, the advertiser used only its score from the single quarter in which it out-ranked Stainmaster.5

The challenger also maintained that different performance points were improperly awarded to equally performing paints based upon whether they were technically “toned” or “untoned” paints,6 resulting in different “final scores” being awarded to paints that received the same “raw laboratory findings score” by using an unexplained score conversion technique. Consequently, the challenger argued that the data was manipulated and did not support the advertised rankings.

The challenger argued that even if the test methodology was acceptable, the test results still did not support the “ranked #1 for four consecutive years” claim.

NAD determined  however that, due to the optical differences between toned and untoned paints, it was reasonable to evaluate toned and untoned and rate them using different scoring systems.

The challenger observed that the results of the lab tests show that no one particular type of Behr paint consistently received a #1 Rating. While there was always at least one type of Behr paint that received a #1 rating out of two tests conducted each year, no one was consistently number one. 

The challenger noted that the test results showed that the Behr 1850 paint was rated #1 only three out of eight quarters and that the Behr 1050 paint was rated #1 only two out of eight.7  The challenger argued that does not substantiate that Behr Premium Plus interior paint was “Rated #1” or “Rated #1 for four years in a row,” and in fact shows that it was not. The advertiser did average those two rankings, even though the two BEHR paints were not being compared to the same competitors in any given quarter.

III.  The “Rated #1 for coverage ... and rated #1 in high-traffic areas” Claims.

The challenger contended the advertiser had no basis for these claims because Consumer Reports did not actually “rank” paints for these purposes, but simply offered “Quick Pick” recommendations for a number of competing paints in specific performance categories.

Advertiser’s Position

I.  The “Rated #1 by a leading independent consumer publication” Claim.

The advertiser asserted that this claim was substantiated at the time that it was made, that it was discontinued when the magazine issued its new ranking, and prior to the date of the challenger’s complaint.

The advertiser also argued that NAD’s Grey Goose8, Applebee’s9, and World Finer Foods10 decisions should not apply because they were factually distinguishable from the case at hand.

II.  The “Rated #1 by an independent national study” and “Rated #1 four years in a row” Claims.

The advertiser stated that its “based on a leading independent study” claim (which replaced “based on a leading independent consumer publication”) was based on valid test results from an independent laboratory with an extensive twenty-year background in industry testing, which used ASTM protocol and common industry tests to compare paint products.

The advertiser explained that in the independent tests, Behr ranked highest among interior flat paints based on an average score of 96.25 (out of 100). The advertiser asserted that the best manner in which to determine the #1 ranked flat paint for any given year is to average the first and third quarter test scores. According to the advertiser, when the results were thus computed, either its Behr 1850 or 1050 paint ranked #1, with the other ranked number two in 2004, 2005 and 2006. Thus, the advertiser asserted, Behr Premium Plus interior paint was “Rated #1” four years in a row.

 The advertiser noted that there is no industry standard to support the challenger’s position that 50% of the score be based on the “hiding” attribute, and rejected the challenger’s assertion that the test was flawed because Stainmaster was not compared in the quarter where Behr had a higher rating, arguing that it should not be required to average its two scores from the year when Stainmaster was not tested.11  Consequently, the advertiser contended, it should be able to use the higher of its two scores. In the alternative, the advertiser asserted that the scores could be averaged and Stainmaster removed from consideration since it did not have a full year of scores.

The advertiser also rejected the challenger’s position that the lab tests compared dissimilar products, and that untoned paint is of a lesser quality.

III.  The “Rated #1 for coverage ... and rated #1 in high-traffic areas” Claims.

The advertiser acknowledged Consumer Reports “Quick Picks” only referred to Behr as “one of the best” in the “high traffic” and “full coverage” categories, but contended that “one of the best” is the equivalent of number one.

NAD Decision

I.  “Rated #1 by a leading independent consumer publication”.

NAD determined that it lacked jurisdiction to consider this claim12 because it was discontinued prior to the date of the complaint.13

II.  “Rated #1 by an independent national study” and “Rated #1 four years in a row”.

NAD noted that the advertiser has the initial burden of providing a reasonable basis for its claims. If NAD finds that an advertiser has done so, the burden shifts to the challenger to show either that the advertiser’s evidence is fatally flawed or that the challenger possesses stronger, more persuasive evidence supporting a different result.14 

And, NAD said, the lack of an industry standard for rating interior paints “overall” does not necessarily preclude an advertiser from making such a claim, provided that it has a reasonable basis for them.

NAD observed that the results of the independent testing demonstrated that no one Behr interior paint (i.e., Premium Plus 1850 or Premium Plus 1050) consistently received a #1 rating over the eight quarters reported, although one of the Behr paints (Premium Plus 1850 or 1050) did alternatively occupy either #1 or #2 position in any given quarter, and acknowledged that the average of the advertiser’s scores for its Premium Plus paints over that period were consistently the highest.15

 But NAD also observed that the paints selected for testing in certain calendar quarters were not identical and that the advertiser’s averaging its rankings was improper because the two paints were not being compared to the same competitors’ paints in any given quarter.

Additionally, NAD questioned the use of only the highest score for Behr’s ranking rather than the average, as was done in other years, and which would have created an average score of 96.25, which would have been lower than Stainmaster’s score.

In doing so, NAD rejected the advertiser’s argument that it should not be required to average its scores when Stainmaster was not tested in one of the two quarters, and alternatively, should be allowed to average its scores and remove Stainmaster entirely from consideration (which would have left the advertiser with the highest score for that year). NAD deemed it inappropriate to summarily discard a higher-ranking score because it did not fit in to the advertiser’s mode of calculating rankings, and noted that the mode was chosen by the advertiser, not the lab.

NAD observed that an important part of its rationale was that the “Rated #1” and “Rated #1 for four years in a row” by an “independent national study” claims are compelling and likely raise consumer’s expectations. NAD determined that consumers would reasonably expect virtually indisputable supporting data for such claims, which Home Depot did not have.

NAD concluded that the “independent national study” upon which the “Rated #1” claim was based would be reasonably interpreted by consumers to be more incontrovertible than was actually the case.16

In reaching this determination, NAD also said it could not ignore the fact that, while this claim was no longer premised upon the Consumer Reports testing, the new claims did directly follow on the heels of that campaign.

Also of concern to NAD was the weight afforded to certain criteria in the underlying testing.

NAD determined that different paint qualities like hiding power and touch-up are important to different users (paint manufacturers, raw materials suppliers, contractors, consumers, etc.), and, while there is no industry standard that addresses the weight that should be afforded to each criteria when testing paint performance, the advertisements were directed at a general consumer audience and the weighting used in the tests was not designed with that in mind.

While NAD did not take issue with the fact that the category of liquid paint properties (viscosity, free-thaw stability difference or heat stability difference) was accorded a weight of only 5% of the total score, or that a weight of 40% was accorded to dry performance properties (adhesion, washability, scrub resistance, burnish resistance, water spotting, etc.), NAD did take issue with the weight accorded to the sub-categories of the application properties.

Although the application properties category as a whole constituted 35% of the total score, its sub-categories were assigned the following weights: Applied Hiding (10%); Touch Up (10%); Leveling (5%) and the other sub-categories (10%). NAD observed that both Consumer Reports and the advertiser’s expert noted the importance of these specific paint qualities, and said it was particularly troubled by the fact that the test afforded Applied Hiding, Touch Up and Leveling so little weight.

Although it didn’t address the validity of the challenger’s position that “hideability” should comprise approximately 50% of the total overall score, NAD noted that the advertiser had reached the “30% weight level for the “hiding criteria” by combining the sub-category “Applied Hiding Average Total Score” (given a weight of only 10%) with a wholly separate and larger category, “Appearance Properties” (weighted 20%). NAD noted that aside from the question of how the other category of “Appearance Properties” relates or impacts a paint’s hideability, this characteristic was accorded twice as much weight as the “Hiding” attribute. Further, NAD observed that both Consumer Reports and the lab noted the importance of a paint’s “Touch Up” and “Leveling” capability, but that the advertiser’s test weighted these attributes only 10% and 5%.

Noting that while claim substantiation does not require perfection, it does require advertisers to show a reasonable basis for its claims,17 NAD determined that the advertiser’s evidence was insufficiently reliable to provide a reasonable basis for the “Rated #1 by an independent national study” and “Rated #1 four years in a row” claims.

III.  The “Rated #1 for coverage ... and rated #1 in high-traffic areas” Claims.

With regard to the advertiser’s position that Consumer Reports “Quick Pick” recommendations,18 NAD noted that the March 2008 Consumer Reports ratings were outdated.

As such, NAD recommended that these claims also be discontinued.

NAD’s Conclusion:

NAD concluded that the evidence was not sufficiently reliable to provide a reasonable basis for the consumer expectations likely to raised by the advertiser’s “Rated #1 by an independent national study” and “Rated #1 four years in a row” claims, and recommended that they be discontinued.

NAD also concluded that there was no reasonable basis for the claims that Premium Plus paint is “Rated #1 for coverage” or “Rated #1 in high-traffic areas.”

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