NAD Recommends Smart Technologies Modify, Discontinue Certain Claims

New York, New York – Sept. 8, 2010 – The National Advertising Division of the Council of Better Business Bureaus has recommended that SMART Technologies Inc., modify or discontinue certain claims made for the SMARTBoard Interactive whiteboard and projector system, but determined that the company can support certain claims.

NAD, the advertising industry’s self-regulatory forum, reviewed advertising claims that appeared in materials aimed at internal sales personnel and authorized resellers. The claims at issue were challenged by Epson America, Inc., a competing manufacturer of interactive projectors, including the BrightLink 450Wi.

Challenged claims included:

•“Why the SMARTBoard interactive whiteboard is the best choice for classrooms.”

“No Hotspots; No Eyestrain”

“High image quality and resolution for easy viewing”

•“The SMARTBoard interactive whiteboard is optimized for durability and interactivity.”

•“Unoptimized surfaces, including dry-erase whiteboards, create glaring hotspots, which are hard on the eyes, and distract teachers and students from learning.”

•“Image quality is only as good as the surface projected upon; off-white and other colors reduce image quality and can lead to eyestrain.”

•“The SMARTBoard interactive whiteboard is optimized for durability and interactivity whereas the BrightLink 450Wi compromises functionality, image quality and ability to write naturally.”

• “SMARTBoard interactive whiteboards deliver better TCO and ROI when accounting for filter replacements, filter cleaning and total decay costs for the BrightLink 450Wi. One also needs to consider the cost of a suitable projection surface.”

• “SMARTBoard 600i interactive whiteboard systems (projector included) deliver up to US$1,000 in savings over a seven-year period when compared to the BrightLink 450Wi”

• “Filter replacement, filter cleaning and total decay costs can add US$3,000 to the BrightLink 450Wi’s total cost over the same period.”

• “Customers will likely require a dry-erase whiteboard optimized for projection, which can cost an additional US$400.”

NAD, at the outset, determined that the claims at issue fell within its jurisdiction. NAD noted that the fact that marketing materials are targeted to a professional audience rather than a consumer audience does not necessarily remove the advertising claims from review by the self-regulatory system, particularly where they serve to educate sales staff who, in turn, sell the products to consumers.

Further, NAD determined that the materials specifically identified the Epson BrightLink 450Wi by brand and model number, compared the two products in head-to-head charts, and relied on these comparisons in order to demonstrate the advantages of the SMARTBoard over the BrightLink. For these reasons, NAD concluded that the advertiser’s claims were comparative claims, requiring substantiation.

Following its review of the evidence in the record, NAD determined that the advertiser’s claims that using a BrightLink on an “unoptimized” surface would cause hot spots, eyestrain and provide poor image quality were not supported. NAD recommended the advertiser discontinue the claims.

NAD further recommended that the advertiser modify the claims that SMARTBoard has “No Hot Spots; No Eyestrain” to more accurately reflect the evidence, which demonstrated that SMARTBoard has been engineered to reduce hot spots and eyestrain. Finally, NAD concluded that the advertiser’s evidence provided a reasonable basis to support the monadic claim that SMARTBoard provides “high image quality and resolution for easy viewing.”

Regarding the two-part claim “The SMARTBoard interactive whiteboard is optimized for durability and interactivity … the BrightLink 450Wi compromises functionality, image quality and ability to write naturally,” NAD determined that the advertiser provided a reasonable basis in support of the first half of the challenged claim, but recommended the advertiser discontinue the second half of the claim, which references the BrightLink 450Wi.

With respect to the total cost of operation (TCO) and return on investment (ROI) claims, NAD was not troubled by the advertiser’s use of the cheaper SMARTBoard model in the context of the challenged advertisements. NAD was, however, troubled by the advertiser’s use of the full retail price, rather than the lower “education” price for BrightLink. Further, NAD recommended that the advertiser modify any TCO or ROI claims that include the cost of replacing the BrightLink pen and batteries to adequately disclose the basis for such claims.

With respect to the advertiser’s claims regarding the cost of filter replacement, filter cleaning and total color “decay” for the Epson BrightLink, NAD determined that the advertiser’s evidence was insufficient to support such claims and recommended that they be discontinued.

NAD further recommended that the advertiser modify the claims that “[o]ne also needs to consider the cost of a suitable projection surface,” and “[c]ustomers will likely require a dry-erase whiteboard optimized for projection, which can cost an additional US$400” to reflect the fact that purchasing a dry-erase whiteboard or other “optimized” surface is something consumers “may” want to consider, rather than something that consumers will require.

In addition, NAD recommended that the advertiser clearly and conspicuously disclose the fact that SMART projectors require cleaning when using the claim “filter free design, eliminating the need for filter cleaning and replacement,” in a comparative context, where filter cleaning and replacement costs or requirements of other competitive projectors are noted. Finally, NAD noted that the advertiser voluntarily elected to permanently discontinue its use of the following claims “closed-projector engine;” and DLP technology “does not require cleaning or filter replacement.”

SMART Technologies, in its advertiser’s statement, said the company would take NAD’s findings into account in future advertising. ###

NAD's inquiry was conducted under NAD/CARU/NARB Procedures for the Voluntary Self-Regulation of National Advertising. Details of the initial inquiry, NAD's decision, and the advertiser's response will be included in the next NAD/CARU Case Report.

About Advertising Industry Self-Regulation: The National Advertising Review Council (NARC) was formed in 1971. NARC establishes the policies and procedures for the National Advertising Division (NAD) of the Council of Better Business Bureaus, the CBBB’s Children’s Advertising Review Unit (CARU), the National Advertising Review Board (NARB) and the Electronic Retailing Self-Regulation Program (ERSP).

The NARC Board of Directors is composed of representatives of the American Advertising Federation, Inc. (AAF), American Association of Advertising Agencies, Inc., (AAAA), the Association of National Advertisers, Inc. (ANA), Council of Better Business Bureaus, Inc. (CBBB), Direct Marketing Association (DMA), Electronic Retailing Association (ERA) and Interactive Advertising Bureau (IAB). Its purpose is to foster truth and accuracy in national advertising through voluntary self-regulation.

NAD, CARU and ERSP are the investigative arms of the advertising industry’s voluntary self-regulation program. Their casework results from competitive challenges from other advertisers, and also from self-monitoring traditional and new media. NARB, the appeals body, is a peer group from which ad-hoc panels are selected to adjudicate NAD/CARU cases that are not resolved at the NAD/CARU level. This unique, self-regulatory system is funded entirely by the business community; CARU is financed by the children’s advertising industry, while NAD/NARC/NARB’s primary source of funding is derived from membership fees paid to the CBBB. ERSP’s funding is derived from membership in the Electronic Retailing Association. For more information about advertising industry self-regulation, please visit www.narcpartners.org.