“Loot boxes” and other in-game purchases: ASA launches consultation

What might gaming service providers expect to see in the ASA’s new guidance on advertising in-game purchases?

The key takeaway

The proposed guidance provides direction on the existing rules in relation to in-game purchases, rather than introducing any new rules. It would be prudent for those who offer in-game purchases to get ahead now, by reviewing the proposed clarificatory guidance now for the impact on their business. Responding to the consultation is clearly important, but so is being aware of what’s coming down the line from a software design and development perspective (eg the inclusion of “countdown” clocks, which have the potential to pressure vulnerable people). 

The background

The ASA has published a consultation on its proposal to introduce new formal guidance on advertising “loot boxes” and other in-game purchases.

It is a common feature within video games and apps to be able to make purchases within the game, either directly or via an external platform. In-game purchases can range from low value purchases (for example, performance boosting items or queue skipping abilities), to significant spends (for example, in-game currency or expansion packs).

The ASA states that it has been notified about in-game purchasing concerns by a wide range of sources, from members of the public, Government Select Committees and the press to campaign and research organisations. Not all of these concerns are within the remit of the ASA as the advertising regulator, but three key areas have been identified where the ASA intends to produce formal guidance so as to “help to mitigate the potential harms identified”:

1. Clarity of pricing information at point of purchase
   The CAP and BCAP Codes mandate that marketing communications must not mislead consumers by omitting or obscuring material information. In relation to in-game purchases; material information will include the price of the item or the manner in which the price is calculated. The concern is that certain methods of presenting in-game purchase prices effectively obscure the item price. Some of the proposals under the draft guidance include greater clarity around premium currency purchases including (i) the real-world cost of in-game purchases, (ii) odd-pricing, and (iii) savings claims on bundled items.
2. The language and approaches used to advertise in-game purchases (and the games they appear in)

   CAP and BCAP are concerned that the nature of in-game purchasing can be potentially harmful to vulnerable individuals, particularly where this takes place within immersive gameplay or mimics gambling characteristics. These concerns arise in particular where in-game purchases are time-pressured, an element which the ASA notes is unique to this form of advertising. The draft guidance advises that, in the case of immersive marketing messages, marketers should avoid the use of excessively short countdown timers, particularly where significant sums of money are involved. In relation to “random-item purchasing”, the ASA advises that encouragements to “try one more time” or suggestions that the next purchase may result in a rare item are unlikely to be acceptable.

3. The use of in-game purchased items in ads for games
   CAP and BCAP are concerned that the presence of in-game purchased items in advertising may be a material factor in the decision of a consumer to purchase or download a game, particularly in relation to those with gambling-related vulnerabilities. The ASA advises that marketers should make clear that a game includes in-game and random-item purchasing, and that this warning should be “easily accessible ... and straightforward to find”.

The ASA welcomes consultation responses from a wide range of stakeholders. Gaming providers are advised to read the draft guidance and consider its impact upon their services. Where gaming providers consider that there is cause for concern or that the new guidance is not fit for purpose, they should respond to the ASA’s consultation accordingly. The draft guidance is currently available via the ASA website and the consultation will close on 28 January 2021.