ASA Adjudication on Fundraising Innovations Ltd

Ad

A press ad for the Sunday Times energy provider switching service stated "you can beat the energy price rises. Energy prices have risen by up to 35%*. Typical bills are now a shocking £1,300 a year. Using our free comparison service, you can find your cheapest tariff in a flash, and switch to save up to £365**. Millions won't, but you can. Beat the energy price rises ..." The asterisks were linked to footnotes which stated:

* "British Gas price for gas of 35% 30/07/2008"; and
** "At least 12% of customers who switched dual fuel through the Sunday Times switching service between Jan1 2008 and Aug 1 2008"

Issue

The complainant challenged whether:

1. the savings claims in the ad could be substantiated;

2. the claim "beat the energy price rises" was misleading, because she believed switching between suppliers at one point in time would not necessarily translate into longer term savings;  

3. the claims were representative of the savings consumers were likely to make by using the switching service at the time the ad appeared (end of August 2008).

CAP Code (Edition 11)

Response

1. Fundraising Innovations t/a thetimesswitch.com (Fundraising Innovations) said, for dual fuel switches carried out for customers between 1 January and 1 August 2008, at least 12% of customers achieved savings of £365 or more using the Sunday Times switching service. They sent data to show that.

2. Fundraising Innovations said the average price of an energy bill had risen by about £380 between January and August 2008, which meant that savings of up to £365 would all but wipe out the price rises for gas of 35% announced by British Gas on 31 July.  They said the main savings achieved by switching suppliers came from four areas: switching from two single suppliers to a dual fuel tariff; switching away from the standard regional supplier for electricity; moving from a standard supply to an online tariff; and additional loyalty payments made to customers by suppliers who stayed with them for a 12-month period.  They said these forms of saving were independent of price movements, although additional savings could come from the differences between supplier tariff offerings. They said only 13% of customers switching to a new dual fuel tariff for the period 1 January to 1 August 2008 were on an internet tariff and therefore the majority of their customers could make considerable savings with a long-term effect due to the change in billing and servicing offered.

3. Fundraising Innovations said, in the two weeks before 31 August when the ad appeared, 12% of the dual switches saved £550 or more, well in excess of the £365 used for the ad.

Assessment

1. Not upheld

The ASA noted that in the data sample sent by Fundraising Innovations, at least 12% of customers switching to dual fuel tariffs with the Sunday Times switching service between 1 January and 1 August 2008 could be capable of achieving savings of £365 or more.

On this point we investigated the ad under CAP Code clause 3.1 (Substantiation) and 7.1 (Truthfulness) but did not find it in breach.

2.  Upheld

We considered that the headline claim "You can beat the energy price rises" and the claim "Energy prices have risen by up to 35%. Typical bills are now a shocking £1,300 a year ... you can find your cheapest tariff in a flash, and switch to save up to £365" implied that consumers taking advantage of the service at the time the ad appeared would be able to beat the energy rice rises by switching suppliers and obtaining a lower fuel tariff than that offered by their previous supplier, saving  up to £365 over the next 12 months. We noted the reference to energy price rises was based on a British Gas price rise for gas of 35%, but also noted the savings claim used as a reference point for beating energy price rises was based on switches to dual fuel tariffs, between 1 January and 1 August 2008. We noted that consumers switching from two separate suppliers to dual fuel were likely to save money regardless of energy price rises, and also noted that because energy prices were subject to rapid change at the time the ad appeared, switching suppliers could not guarantee that any calculated savings would be secure, as a consumers new energy supplier could also subsequently raise their prices.

We concluded the ad was insufficiently clear as to how the advertised savings were likely to be obtained, and could mislead consumers as to  the likelihood of being able to "beat the energy price rises".

On this point the ad breached CAP Code clauses 7.1 (Truthfulness).

3. Upheld

We noted, from the data sent by Fundraising Innovations, that at least 12% of customers using the service in the advertised period who had switched to dual fuel had potentially saved £365 or more, and also noted Fundraising Innovations assertion that in the two weeks before the ad appeared, at the end of August, 12% of those switching to dual fuel had saved £550 or more. However, we considered the claim "Typical bills are now a shocking £1,300 a year... you can find your cheapest tariff in a flash, and switch to save up to £365" implied that all consumers who responded to the ad would find a cheaper tariff than the one they were on and could save up to £365 over the 12 months following the switch. We noted we had not seen evidence to show that. We also noted, from the data provided by Fundraising Innovations, that consumers who used the service to switch to dual fuel saved the most whilst consumers who switched their tariffs in other ways saved less.

Because the savings of those people using the service to switch from two single suppliers to a dual fuel tariff were not representative of savings likely to be made by all consumers responding to the ad, and because people switching at the time the ad appeared would not be protected from imminent increases in the price of energy provided by the new supplier that might negate the claim, we concluded that ad was likely to mislead.

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

Action

The ad must not appear in its current form.  We advised Fundraising Innovations to consult the CAP Copy Advice team before publishing future comparative ads.

Adjudication of the ASA Council (Non-broadcast)