Ad description
A website for Bike2work Scheme, www.Bike2WorkScheme.co.uk, a provider of bikes through the cycle to work scheme, seen on 3 January 2018, featured a savings calculator, which consumers could use to check their monthly payments and income tax savings against the total cost of the bike.
Issue
The complainant, who believed that the calculator made no reference to a final payment that needed to be made in addition to the 12 monthly payments, challenged whether the ad was misleading.
Response
Bike2work Scheme Ltd said HMRC specified that, to receive tax benefits, employees needed to enter into a hire agreement with their employer, and that employers could not suggest that either the employee or anyone else could buy the bike or equipment. Employers were free to sell ex-rental equipment but there was no obligation on the employee to buy it.
Bike2work said they provided employees with an abundance of information advising them that the agreement was a hire agreement and did not lead to automatic ownership. They said the savings calculator asked employees to provide details of the cost of bike, helmet and equipment, their annual salary, pay frequency and time to repay. It was intended to provide an estimate of what employees could save but they believed it made clear, through a combination of information in the calculator itself – the statement "amounts may vary and further charges may apply" – and the FAQs, that amounts could vary and that further charges, including for transfer of ownership, could apply.
Assessment
Upheld
The savings calculator appeared in the context of Bike2work's "Employee Information" page. Text below the heading "GET READY/SIGN UP, GEAR UP" stated "Once registered, you'll be able to browse over 2,200 partner stores - including leading retailers ... And even if you already have a bike, you can still enjoy up to 42% savings on equipment". Text next to the first of six ticked boxes stated "Save up to 42% on the cost of bikes and equipment". The first piece of information asked for in the savings calculator was "Cost of bike".
The ASA acknowledged that there was no specific reference to employees owning a bike or equipment by taking part in the scheme. Neither, however, had there been any reference thus far to a bike or equipment being supplied on a hire basis. We considered that the reference to "partner stores"; the savings claim "Save up to 42% on the cost of bikes and equipment" (a reference to the purchase price) and the need to input the purchase price of the bike and equipment on the savings calculator, all contributed to the natural expectation that employees would own the items once they had made the last of the required payments. Instead, however, we understood that at the end of the hire period, an additional payment would be necessary if an employee wished to take over ownership of the bike or equipment.
We considered that the statement in the calculator "amounts may vary and further charges may apply" and the explanations in the FAQs and the hire agreement that a bike or equipment would be supplied on a hire basis were not sufficient to alter the impression created by the "Employee Information" page of the website, that participants in the scheme would own the bike at the end of the payment period. We therefore concluded that the ad was misleading.
The ad breached CAP Code (Edition 12) rules
3.1
3.1
Marketing communications must not materially mislead or be likely to do so.
and
3.3
3.3
Marketing communications must not mislead the consumer by omitting material information. They must not mislead by hiding material information or presenting it in an unclear, unintelligible, ambiguous or untimely manner.
Material information is information that the consumer needs to make informed decisions in relation to a product. Whether the omission or presentation of material information is likely to mislead the consumer depends on the context, the medium and, if the medium of the marketing communication is constrained by time or space, the measures that the marketer takes to make that information available to the consumer by other means.
(Misleading advertising).
Action
The ad must not appear again in the form complained of. We told Bike2work Scheme Ltd to ensure that the "Employee Information" page made clear that bikes and equipment were supplied on a hire basis and that employees would not own the bike at the end of that period.
