After almost three years of enquiry and legal proceedings, the Competition Commission of Pakistan (CCP) has passed an order imposing a fine of Rs 6 crores on Unilever Pakistan for airing deceptive claims through television commercials for its hygiene and cleansing products, ‘Lifebuoy (Care and Protect) Soap’ and ‘Lifebuoy Hand Wash’.
Based on a complaint submitted by Reckitt Benckiser (RB) a few years ago, about their Lifebuoy Soap and hand wash. The CCP conducted an inquiry into Unilever Pakistan Limited’s absolute claims regarding its products, such as “100% guaranteed protection from germs”, “World’s No. 1 germ protection soap”, and “99.9% germ protection in 10 seconds.”. As per the enquiries, the disclaimers about these claims were printed in tiny fonts and were hardly noticeable.
While it seems as if Unilever got served for making tall claims about its product, there is more at play here than just marketing. It is to be noted that this is not the first time one of these companies have gone to the regulator against each other for deceptive marketing. Hence it becomes important to understand the dynamics of the anti-bacterial soap industry, the relationship between these companies and how impactful deceptive marketing is in the industry.
The industry infighting
In recent years, the battle between multinational corporations over market share has escalated beyond product innovation and consumer satisfaction all across the world. The reason could be market saturation, bad global economic indicators or something more. But there is a feud that predates all these plausible reasons, and that feud is between Pakistan’s anti-bacterial soaps.
According to NielsenIQ as of 2016, the antibacterial soap market of Pakistan comprised 48% market share of the overall soaps market. Which means that nearly half the soaps in the country claimed to be anti-bacterial. However, unlike the beauty soap category, one that has a low barrier to entry, the anti-bacterial soap market had low competition due to the preliminary research and development costs.
By design three giants dominate this specialised soap and handwash market. Unsurprisingly, these giants are Unilever, Proctor and Gamble (P&G) and Reckitt Benckiser (RB). Over the years, the competition of these soap makers has increasingly spilled into the regulatory domain, where companies pull each other’s leg for their marketing practices.
As a consumer, it is often confusing what is the best antibacterial soap of Pakistan. Is it P&G’s Safeguard? Is it Unilever’s Lifebuoy? Or is it RB’s Dettol?
It doesn’t help that all three of them in their marketing practices claim to kill at least 99.9% of the germs if not the full 100%. It is interesting to note that these jaw dropping figures have been the very reason for regulatory action, yet to this day, these companies continue to use absolute and arbitrary numbers. But why do they keep complaining about each other? And why do they keep on employing the same marketing tactics themselves?
It all began when RB lodged a complaint against P&G for deceptive marketing at the CCP, back in January, 2016. The complaint was against the latter’s claim of Safeguard being Pakistan’s “number one anti bacterial soap”. It was determined that neither by value nor by volume was Safeguard, the number 1 antibacterial soap. The CCP hence decided that P&G was in violation of section 10 of the Competition Act. They set a penalty of Rs 10 million to be paid by P&G for this violation. Eight years after P&G’s appeal against the CCP’s decision, the Competition Appellate Tribunal, in 2024, reduced this penalty to Rs 5 million (50 lakhs) due to P&G’s “compliance-oriented” approach.
A similar conflict between Unilever and RB began when Unilever Pakistan lodged a formal complaint with the CCP against RB in November 2016. The complaint focused on RB’s flagship product, Dettol Soap, which had been advertised as providing “99.9% germ protection” and offering “24-hour protection against germs, cold, and flu.” These claims, according to Unilever, were misleading and lacked a scientific basis, thereby constituting deceptive marketing under Section 10 of the Competition Act, 2010.
The CCP initiated an inquiry, which concluded that RB’s marketing campaign was indeed deceptive. The claims were found to be unsubstantiated and capable of misleading consumers, as well as harming the business interests of other companies, particularly those competing in the hygiene and personal care sector. As a result, in December 2019, the CCP imposed a fine of PKR 30 million on RB for these violations. Five years later, the appellate tribunal did the same favour for RB, reducing the penalty by half, making it Rs 15 million (1.5 crore) in July 2024.
The most recent complaint against Unilever was lodged in February 2021 by RB. Even though Unilever is found in violation of the same section of the competition act, it was fined at least 4 times more.
According to the CCP, “Unilever’s deceptive practices varied by region, with different wording for the same product in countries such as Saudi Arabia, the UK, and Bangladesh. The most severe deceptions were found in Pakistan, which the Commission deemed unacceptable.”
The company reserves the right to appeal against the decision just like the other two did.
How many germs can a soap actually kill?
The idea that a soap needs to “kill” germs to make it a hygienic choice is actually flawed in itself. Years of marketing and preying upon compulsiveness and fear landed us with an entire category of over-the-counter antibacterial soaps. Any normal soap, be it homemade, binds to bacteria, to wash them off of the user’s hands. Now whether we need killing agents for it to also kill that bacteria, is entirely a personal preference.
From a scientific standpoint, the “99.9%” kill-rate or a “100%” protection is often an oversimplification. It suggests near-total effectiveness, but in reality, the small percentage of germs that survive can quickly multiply, potentially leading to significant health risks. Additionally, there are a lot more variables to eradicating bacteria than just the type of soap that one uses. Claims often do not account for the proper use of the product, such as sufficient contact time or correct application or the type of bacteria being fought. Details which are crucial for achieving the advertised results.
The claim “kills 99.9% of germs” often focuses on specific bacteria that the product has been tested against, such as E. coli or S. aureus. However, it may not be effective against other types of bacteria or viruses. Thus, while it may be true in a controlled laboratory setting, the claim doesn’t necessarily apply to the wide variety of microbes encountered in real-life situations. It is also important to note that these results are often obtained under specific usage conditions. Leaving the soap on for two-minutes on average is one of these conditions. Right off the bat, most people aren’t even obtaining the full utility out of these soaps.
A much more alarming aspect of this debate is that repeated use of antibacterial agents like triclosan can also lead to the development of resistant bacteria. Bacteria that survive the antibacterial treatment can multiply and pass on resistant traits, potentially leading to resistant bacteria that are more difficult to kill. Substances like triclosan and triclocarban were subsequently banned in the United States in 2013, for use in OTC soaps.
To this day, Pakistan regulates the use of these and many similar chemicals, however, no outright ban has been placed by the Drug Regulatory Authority of Pakistan (DRAP).
If one looks at it scientifically, the very idea that a soap can be marketed on its unique ability to kill germs seems dubious. However dubious is not always categorised as deceptive.
Why is deceptive marketing dangerous?
Deceptive marketing in essence is merely a breach of consumer trust. It definitely has far-reaching implications that affect various stakeholders, including consumers, competitors, and the broader market ecosystem. The cases involving Reckitt Benckiser, Procter & Gamble and Unilever serve as important examples of how specific deceptive marketing practices can actually distort market realities and harm consumer well-being.
One of the most direct consequences of deceptive marketing is the spread of misinformation among consumers. When companies make exaggerated or unsubstantiated claims, consumers are led to believe in the efficacy or superiority of a product that may not be as good. In the cases of Unilever and P&G, consumers were misled into believing that their products offered unparalleled protection against germs, which could have serious health implications if the products fail to perform as advertised.
These practices also distort the competition in the market by giving an unfair advantage to companies that engage in such tactics. This not only harms competitors but also undermines the integrity of the market. In both cases filed by RB, RB was placed at a disadvantage because its competitors were making inflated claims that could sway consumer preference. This creates an uneven playing field, where success is not based on product quality or innovation but on who can make the most compelling, albeit misleading, marketing claims. It is also important to acknowledge that while it may seem like it, the personal vendetta and market share politics, come after a brand image. Therefore it becomes mandatory for these companies to report on their competition, if the competition is found in violation.
Another important reason why the CCP cracks down on these practices is because deceptive marketing can also reduce the effectiveness of consumer choice. When consumers are bombarded with misleading claims, their ability to make informed decisions is compromised. This can lead to a situation where inferior products dominate the market simply because they are more aggressively marketed, rather than because they are better or more cost-effective.
Why Does Reckitt Benckiser Benefit from Action Against Unilever and P&G?
There is of course no denying that these complaints against each other have now become a regular part of the Pakistani antibacterial soap market. Much like Unilever benefitted from the action against RB, Reckitt Benckiser also stands to gain significantly from regulatory action against its competitors.
By holding Unilever and P&G accountable, RB can reinforce its position as a brand that consumers can trust. This is especially important in the health and hygiene sector, where trust in a product’s efficacy is paramount. Regulatory action against deceptive practices also serves as a deterrent to other companies, encouraging a more honest and transparent marketing environment that benefits all players.
Another thing that RB benefits from is the market correction that occurs when deceptive practices are curbed. When competitors are penalised and forced to retract false claims, it opens up market share for RB to capture, particularly if its products are genuinely superior. While this correction has already occurred in the past, there is little to no data to show for it.
Conclusion
Even though there is a lot of gap between the times of the filings of these cases, their resolutions have all come within the last 5 months. This is because the Competition Appellate Tribunal had not been functioning for the last seven years. After the appointment of a full time chairman, the tribunal has made lots of headway into clearing its backlog of more than 200 cases.
The delay in these decisions is important to mention because it undermines the commission’s stance on these marketing campaigns. If not overtly, one reason why after repeated decisions and fines, these companies continue with these branding practices is because the repercussions are either delayed or insignificant.
While it is difficult to calculate, what percentage of sales is Rs 1.5 crore of Dettol’s total sales in 2024?
And to what extent are these marketing campaigns curbed upon corrective action? For example, Lifebuoy’s current slogan is that it, “fights 99.9% of bacteria and viruses”, the modification being that it fights but doesn’t necessarily win against all 99.9%. Is it deceptive, or is it a clever play on words? Either way, a gullible consumer is out to be fooled by this claim.
Similarly, Dettol Pakistan claims to provide a “24 hour protection from germs”. Can RB substantiate these claims? Will the CCP take Suo moto action against these claims? Or will it wait for one of them to file a complaint against the other?
These cases are a stark reminder of the importance of maintaining ethical standards in marketing. But more importantly they should serve the purpose of awakening the regulator, lest it becomes a tool for companies to use against each other, when need be.
The pursuit of short-term gains through unethical means often results in long-term consequences that far outweigh any immediate benefits as consumers become more aware and regulatory bodies more vigilant. The problem is that not only is the consumer devoid of information in this regard but the regulatory body also needs to be a step ahead of the corporation if it is to make a difference.
The Competition Commission of Pakistan’s actions in the Unilever case demonstrate the critical role that regulatory bodies play in safeguarding both consumers and businesses from the harms of deceptive marketing.
