ASA Adjudication on Craftmatic UK Ltd

Ad

An e-mail advertising a job opportunity stated "Ever Consider A Career in Sales? No Experience/ Will Train! A £2000 Sign On Bonus*... For Those Who Excel. Sales - Serious High Earners - High as £35, 721/ In Just 13 Weeks.High as £5619.75 (1/wk/comm.) £4914.76 (1/wk/comm.) ... If Someone Can Do It!/ Can You? Seeking Experienced Salespeople Capable of Earning Over £4000 Comm. in a Single Week: Previous Paid Commissions as high as ..." The ad then listed a number of figures in the £4,500 to £5,600 range which it said people had previously earned as commission in one week whilst working for them. The ad continued "25,000 New Response Leads Monthly/ No Slow Seasons".

Issue

The complainant challenged whether:

1. the earnings claims and commission figures exaggerated the likely earnings that recipients might achieve if they took up the opportunity, and

2. the claim "25,000 New Response Leads Monthly" could be substantiated.

CAP Code (Edition 11)

Response

1. Craftmatic UK Ltd (Craftmatic) said they engaged independent sales representatives as their agents in the UK. They said representatives were paid commission only with earnings based on the value of the sales that they concluded with customers. They said respondents to Craftmatics' recruitment ads were invited to take part in an interactive conference call at which further details of the opportunity and the company were provided. They said a four-day recruitment training seminar was then provided, at no cost, so each enquirer would have a full understanding of what was required of them before accepting a sales representative position with the company.

They said they sought to recruit high calibre sales representatives to join their team and in their experience such individuals were highly sought after and were drawn to opportunities through which they could obtain high commission earnings. They believed it was critical that all their ads contained a statement about the level of earnings such high calibre individuals could hope to achieve. They said they believed the wording of their ad made it clear that the £35,721 figure quoted was an actual commission amount which had been earned by a Craftmatic sales representative but did not suggest that this was an expected or forecast amount that would necessarily be earned by successful applicants. They said their copy clearly and deliberately placed the figure in the context of a challenge "If someone can do it!/ Can you?"

Craftmatic said the figures quoted in the ad did reflect actual earnings achieved by some of their top sales representatives. They sent invoices to show that.

2. Craftmatic said they had a large generation lead programme and regularly contacted 60 different third party mailing lists in the UK and placed inserts in the outgoing shipments of dozens of companies. They said they also ran ads in magazines and on television. They said this generated a substantial volume of new enquiries and leads every month. They sent a spreadsheet to show the aggregate number of leads per month, which provided the number of direct mail pieces sent, the number of magazine insertions placed and the number of marketing e-mails sent. It also provided the number of responses attributable to each of these categories. They said every respondent was contacted by a telesales representative with a view to booking an appointment for a sales representative to visit.

Assessment

1. Upheld

The ASA understood Craftmatic principally sold adjustable beds. We understood from Craftmatic that the sales positions were commission only with no basic salary, however we considered that the claim "Sales - Serious High Earners - High as £35,721/ In Just 13 Weeks ... Seeking Experienced Salespeople Capable of Earning Over £4000 Comm. in a Single Week" did not make clear whether sales representatives working for Craftmatic would receive a basic salary with commission on top or would earn commission only.

We noted Craftmatic had not sent evidence to show the number of sales representatives working for them in the UK or the average weekly commission earned by those representatives, and understood that the figures in the ad referred to the earnings of a small number of their top representatives. We acknowledged the list of quoted figures appeared under text stating "Previous Paid Commissions as high as" but concluded that, in the absence of data to show otherwise, the headline claim "Sales - Serious High Earners - High as £35,721/ In Just 13 Weeks. High as £5619.75 (1/wk/comm.) £4914.76 (1/wk/comm.) ..." in the context of the ad as a whole exaggerated the likely earnings that applicants could achieve.

On this point, the ad breached CAP Code clauses 3.1 (Substantiation), 7.1 (Truthfulness) and 52.2 (Employment and business opportunities: representative earnings).

2. Upheld

We noted the document provided by Craftmatic showed numbers of leads generated monthly for the year 2008 and for 2009 from January to September (the month in which the ad was published).  We acknowledged the figures showed an average of over 26,500 leads per month for the twelve month period before the ad was published . Nevertheless, because six of those months showed under 25,000 leads we considered that the claim "25,000 New Response Leads Monthly" was likely to mislead.

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

Action

The ad must not appear again in its current form.

Adjudication of the ASA Council (Non-broadcast)