Request penalty or extra charges of any kind

ADVISORY OPINIONS WITH REQUESTS THEREFOR 1035 1030 Request penalty or extra charges of any kind. Publisher will provide alternate copy for any such pages deleted. This copy will be of general consumer interest, such as recipes, household hints, health tips, beauty aids, etc. As any pages deleted will change total savings as shown on front cover, publisher will make change necessary without charge.

19. Retailer(s) desiring to individualize books by deleting any manufacturer’s pages and using space for their own copy may do so by supplying camera-ready copy to fit space, paying charge for necessary plate changes and 1¢ per copy extra for each two-page manufacturer's unit displaced. 20. Books will be offered with title “Cash-A-Brand” Savings Book. Any retailer(s) desiring to change title to one of their own choosing may do so by supplying type or art-work necessary and paying charge for plate change necessary.

21. Any retailer(s) desiring to further individualize their books by complete change in style of covers, copy on inside front cover, facing page 3 or colors of ink may do so by supplying camera-ready copy and paying for plate changes or press washups necessary. Copy submitted will be subject to publisher’s approval and publisher will reserve all rights of copyright or registration of trademarks. 4 22, Voluntary, cooperative, other groups, associations or chains of retailers pooling order and indvidualizing covers of books under conditions outlined above may personalize each member or individual store’s books with imprint of store name, address and city on front and back covers without penalty or extra charge of any kind.

(We feel it is necessary to explain how it is economically feasible for us to personalize books with individual retailer’s name, address, city. Press facilities include a set of two special imprinting cylinders. While one is in operation the other is idle. While one order of books is running and imprinting an order (using rubber plates made in advance) the next retailers name, etc. is being placing on idle cylinder. As an order is completed a set of gears shift the idled cylinder into operation and run continues without stopping press.) 23. Retailer desiring to further individualize their books by any other methods acceptable to publishers may do so by supplying camera-ready copy and paying charge for plate changes necessary.

24, To assure consumers of minimum 20% savings on sponsored products, each redeemable page will be limited to products that consumer can purchase for $2.39 or less at normal retail. Thus one manufacturer could show six products averaging about 39¢ each, while another might show four averaging 59¢ and another three averaging 79¢ each, ete.

25. Offer to retailers will announce approximate date of first press run and no retailer will have books delivered prior to that date. Offer will also include approximate date of second press run to be made after “offer” is repeated (see pp. 10). Retailers can choose either run for production of their books. Retailers individualizing their books may select delivery date other than either of above, providing it is not in advance of first general press run. (See next pp.) 26. Each redeemable page will carry a final redemption date of approximately three months from date books are to be put in circulation by retailers. An unpublicized grace period will allow retailers to redeem pages for another 30 days after that printed date to avoid misunderstandings with customers dejayed by illness, vacations, ete. Retailer(s) may individualize timing of their

470-883—73
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1036 FEDERAL TRADE COMMISSION DECISIONS
Request 79 ¥F.T.C.

promotion by changing redemption date on each redeemable page, providing that date is not in advance of date shown in books delivered from first press run. 27. Three months, plus 80-day grace period will allow consumers approximately 17 weeks to take advantage of total savings which could amount to $7.00 if all 14 redeemable pages are sponsored by manufacturers and acceptable to retailers. Probable cost of all products necessary to fill 14 pages is estimated at between $30.00 and $31.00 as few manufacturers will be able to fit products to exact maximum of $2.89. Consumers would need to spend from an estimated $1.80 to absolute maximum of $1.97 per week to take full advantage of all savings offered.

28. Retailers will be invited to display signs announcing grace period when expiration date of their books approaches. Publisher is considering supplying these signs and if included in service will deliver such signs to each cooperating retailer. 29. Methods by which retailer sput books in circulation will be of no concern to publishers. They may chose to distribute them to customers at their checkout counters or cash registers, by house-to-house in their neighborhood, by mail or other methods of their choosing.

80. Program offers retailers the opportunity to advance sizeable cash reward to their customers, knowing they will be reimbursed and paid 30% profit ‘on cash thus advanced (15¢ for each 50¢). Retailer ordering minimum 500 books will actually be putting 7000 redeemable pages into circulation (500 x 14) if book contains maximum. If 100 of those 7000 pages are redeemed (1.42%) retailer will have recovered initial investment of $15.00 (100 x 15¢) and any additional redemptions will be profit. If 8% redeemed, retailer will recover 210 x 15¢ or $31.50, if 5% or 350, $52.50, etc. As Program Relates to Manufacturers 381. Publishers proposal to manufacturers will include details as outlined above and any manufacturer joining program will agree to participate in all orders from retailers, providing of course, that retailer agrees to inclusion of that manufacturer’s products in books ordered. Summary Publishers are confident of their ability to make this a viable marketing program, simple, practical and economical for manufacturers, exciting and profitable for retailers and with attractive savings to consumers. A favorable response from you will allow us to quickly find out if manufacturers are interested. Next steps would be to please retailers and then motivate families to save on their food and household budgets. If this too lengthy explanation leaves any questions unanswered, please let. us know. It is offered in good faith and without equivocation, misleading language or evasions of any kind. Designing a program which is as usable and suitable for small neighborhood confectionery or grocery store as for a large chain or group has been a challenge to our organization for some time. This idea, simple as it now might seem, is the result of a long and diligent

search for an answer.
Respectfully submitted,
/S/ GLEN SHEPARD
Opinion

Applicability of Trade Regulation Rule Concerning the Unavailability of Advertised Food Specials. (National Association of . Broadcasters and Time Life Broadcasting, Inc.) Opinion Letter* _ Sppremper 1, 1971» Pursuant to your letter of July 9, 1971, the Commission has considered your request for an advisory opinion regarding the interpretation of the recently promulgated Trade Regulation Rule concerning — the unavailability of advertised food specials. The Commission is of the opinion that your request is inappropriate for an opinion under Section 1.1 of the Commission’s Procedures and Rules (see enclosed copy of Procedures and Rules). Section 1.1 provides for consideration of requests for advice “with respect to a course of action which the requesting party proposes to pursue.” (Emphasis added.) As your submission states, the opinion is requested on‘ behalf of your client who is a broadcaster, while the rule to which your request is addressed is directed to retail food advertisers. Thus, it appears that the request is not founded on a proposal by your client to pursue any particular course of action with respect to the Trade Regulation Rule in question.

For the reasons above stated, the Commission is of the opinion that your request for an advisory opinion is inappropriate and, therefore,

denies the request.
Letters of Request
Juxy 9, 1971
Dear Mr. Tosin:

The National Association of Broadcasters (NAB), in accordance with Rule 1.3 of the Commission Rules, herewith seeks from the Federal Trade Commission an advisory opinion as to the applicability of . its recently promulgated Rule on the availability and pricing of food . specials, effective July 12, 1971, to the distant dissemination of broadcast advertising via cable television. The Rule specifies in part that: * * * it is an unfair method of competition, in connection with the sale or offering for sale by retail food store of food and grocery products or other merchandise, to offer any such product for sale at a stated price, by means of any advertisement disseminated in any area served by any of its stores which are covered by the advertisements which do not have such products in stock, and readily available during the effective period of the advertisement. As the national trade organization for television and radio, with’ 536 television and 3,859 radio stations in its membership, NAB is vitally *Identical opinion letters were sent to both correspondents; Mr. John B. Summers and

Mr. William S. D’Amico.
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1038 FEDERAL TRADE COMMISSION DECISIONS
Requests 79 ¥.T.C.

interested in bringing to the Commission’s attention certain aspects of this new rule which will have a deleterious effect upon broadcast advertising. s The signals of many television and radio stations in this country are extended far beyond their normal coverage areas by the facilities of community antenna television (CATV) systems. Relying primarily upon microwave, these CATV systems freely pick broadcast signals off the air and carry them long distances, feeding them into homes where such signals could otherwise never be received. The broadcast station whose signal is utilized in this fashion has no control whatsoever over the CATV system’s selection or carriage of its signals since FCC rules do not require the CATV system to obtain permission from the originating station. “ Only recently have broadcast stations been able to persuade retail food operations to make use of television and radio as an advertising medium to any significant extent. However, NAB has come to understand through its membership that many of these newly gained retail food store clients are terminating all of their broadcast advertising because they are fearful that if their locally purchased commercial spots are carried at will by CATV systems into areas where the statements in the ads on the availability of products and prices are inapplicable; they will then be in violation of the FTC Rule. As stated earlier, broadcast licensees are without any means of controlling the situation since the CATV systems involved are free to pick up a broadcast signal and carry it far afield whether or not the originating station gives its consent. Asa practical matter, it is unlikely that a viewer or listener would be misled into thinking that distant station advertising brought into his area by a CATV system applies to retail food operations in his community ; station identifications required by the FCC, together with the particular wording and references in the ads themselves doubtless will put the audience on notice as to the geographic area for which the ad is intended. .

Accordingly, NAB respectfully requests the Commission to issue an interpretation of Paragraph I of the Rule in order to clarify that the Rule’s advertising provisions apply only to definable markets served — primarily by the advertising medium being used and not to markets into which the medium is not intentionally directed. Such an interpretation of the Rule would insure as well that broader competition is G 1037 -Requests encouraged among food retailers since their uninhibited use of the

broadcast medium would be preserved. .
Respectfully submitted.
(S) . Joun B. Summers,
(S) Louise O. Knieur,