Risk of consumer problems in digital markets not being detected

The Swedish National Audit Office (Swedish NAO) has audited the Swedish Consumer Agency’s supervision of business operators’ marketing and contract terms. The audit shows that supervision is mainly carried out appropriately and effectively.

However, improvements should be made in some areas. This includes addressing the fact that the methods used by the Swedish Consumer Agency to detect consumer problems are inadequate.

The Swedish Consumer Agency lacks effective tools for detecting consumer problems on digital markets and in digital marketing. In particular, “personalised marketing” is difficult to supervise.

“Well-functioning supervision is essential for both consumers and companies. Supervision needs to be constantly adapted to new conditions,” says Auditor General Helena Lindberg.

The audit also shows that the Swedish Consumer Agency is not working systematically enough on risk analyses to obtain a more comprehensive picture of the problems. Consumer complaints is the Swedish Consumer Agency’s most important tool for detecting consumer problems. However, complaints do not give the whole picture, since many complaints are of poor quality or irrelevant in terms of supervision. Furthermore, it is not certain that consumers have understood that the business operator has violated the regulations.

The Swedish National Audit Office assesses that the Swedish Consumer Agency should supplement the risk analyses with a model for evaluating structural consumer damage. Structural consumer damage can consist of, for example, individual consumer damage that affects many consumers in the same way, for example due to misleading marketing.

“In spite of ambitious efforts by the Swedish Consumer Agency to develop the supervisory activities, there is a real risk that supervision is concentrated to problem areas that are already known. This should be developed,” says Erik Trollius, Project Leader of the audit.