ASA Adjudication on Reader Offers Ltd

Ad

Two national press ads for cruise holidays.

a. The first ad was headed "explore the CLASSIC MEDITERRANEAN OR PICTURESQUE SCANDINAVIA" and text, in a box headed "Italian Mediterranean", stated "14 nights from an amazing £999pp". Below that a box stated "BROCHURE FARE PP" and listed room prices at "£4,159, £4,579, £5,449". An adjacent column was headed "READER OFFERS FARE PP" and listed room prices at "£999, £1,599, £1,999".

b. the second ad was headed "The 2008 Classic Italian Voyage Onboard Independence of the Seas. A Truly Amazing Reader Offers Ltd Exclusive ... AMAZING PROMOTIONAL FARES ... ". A table at the bottom of the page titled "Reader Offers Ltd Exclusive" showed the type of room against the full fare per person and the Reader Offers fare per person.

Issue

1. One complainant, who believed the "brochure prices" quoted in ad (a) were for the most expensive type of room and Reader Offer's prices were for the least expensive type of room, challenged whether the ad was misleading, because Reader Offers had used an unfair price comparison.

2. Two other complainants challenged whether the full fare or brochure prices in both ads were genuine, because they believed they could have booked the same room directly through the cruise operator at a price much lower than the full fare quoted in the ad.

CAP Code (Edition 11)

Response

Reader Offers said they represented Royal Caribbean as their travel agent and they sold their cruises and promotional fares on their behalf. They said Royal Caribbean were unusual in that they operated a fluid pricing structure and therefore their brochure stated "from" and "up to" prices. They said that gave them the option to reduce the price down to the lower rate if the need arose: for example, if they were not selling enough cabins at the higher rate. They said they adopted that approach both directly to the public and through travel agents such as Reader Offers.

Reader Offers said they normally quoted a "full brochure price" to make clear that they were quoting the highest price from the Royal Caribbean brochure; they said it was an error that the word "full" had been omitted from ad (a), and (b) stated a "fare" price, because the latest brochure had not been printed at the time the ad appeared. They said cruises could often be bought at lower than full brochure price with Royal Caribbean and they believed the market fully understood that. They said fluid pricing was used on a supply and demand basis, as were the promotional fares, and therefore quite often the price was cheaper to start with and then became more expensive as cabins became fewer and were in more demand.

They said the promotional fare they offered was either an exclusive price to them or, on other occasions, the price was the same as that available through other agents, as well as through Royal Caribbean. They said a consumer could contact Royal Caribbean directly and be offered a price that was the same or only marginally more than the Reader Offers price. They said the full brochure fare quoted in the ad was not necessarily the price that Royal Caribbean was offering: it merely related to the top or full brochure fare for a particular cabin.

Reader Offers said they had been promoting Royal Caribbean cruises for two and a half years; in that time they had had 56,000 enquiries, sent out 20,000 brochures and booked cruises for 13,000 clients but they had only received three complaints about their ads. They said Royal Caribbean contributed to their ads and were in full agreement with the way they promoted and represented their cruises. They said they therefore believed their ads were understood by consumers and were not misleading.

Assessment

Upheld

The ASA noted Royal Caribbean operated a fluid pricing structure, which meant that they quoted a "from" and an "up to" price in their brochures, and the price at any one time could range from anything in between those prices depending on supply and demand. For example, their brochure showed that the cheapest room on an Italian Mediterranean cruise ranged from £1,499 to £4,409. We noted, in both ads, Reader Offers had compared the highest "up to" price from the Royal Caribbean brochure with their own promotional fares.

Although we noted, because of the fluid pricing structure, it was difficult for Reader Offers to quote an exact fare for comparison, we considered that by comparing the highest possible fare from the brochure, Reader Offers had exaggerated the savings consumers were likely to make by booking with them instead of booking directly. Because consumers who booked directly through Royal Caribbean would not necessarily pay the "full fare" or "full brochure" price, and in some cases would pay the same price as the Reader Offers fare, we concluded that the ad was likely to mislead.

The ad breached CAP Code clauses 3.1 (Substantiation), 7.1 (Truthfulness) and 19.1 (Other comparisons).

Action

We told Reader Offers not to use the highest brochure price as a basis of comparison in future. We advised them to seek guidance from the CAP Copy Advice team for their future ads.

Adjudication of the ASA Council (Non-broadcast)