Ad description
A website and a direct mailing for P&O Cruises, seen in June 2017:
a. The website www.pocruises.com, included the sub-headline “Pricing”. Text in a roundel stated “on-board spending money receive up to £550pp” and linked to “Terms and Conditions”.
b. The direct mailing gave examples of cruise prices, such as “Norwegian Fjords 7 nights from £799pp with £100 per outside cabin to spend on-board”. Smaller text stated “and with extra on-board spending money on applicable Select Price holidays with outside cabins, balconies or suites … you can splash out on even more of those little luxuries …”.
Issue
The complainant challenged whether the ads were misleading because it offered "on-board spending money", but did not make clear that a discretionary service charge of £6 per person per night was taken from a customer’s on-board account.
Response
Carnival plc t/a P&O Cruises stated that an optional service charge amount was added to on-board accounts at the start of the holiday. The on-board account was accessed via the TV in each cabin or via Reception, and they considered the charge was clear and unambiguous. The on-board account was settled at the end of the cruise and guests were given an end of voyage statement on the final evening, which showed the service charge, and gave guests an opportunity to question it before the account was settled, which was common for many hotels and cruise lines.
P&O Cruises reiterated that it was an optional service charge and could be removed by a verbal request. They considered that it could not reasonably be seen as information which was material to a consumer's transactional decision. They believed that hotels or restaurants which advertised goods and services were not required to mention in their ads that a service charge might be applied and considered that to impose it as a requirement could have an impact on pricing presentation beyond the cruise industry.
They stated their research had shown that a service charge was seen as a convenient way of dealing with the issue of rewarding service staff, which some guests preferred to use so as to avoid the process of giving cash tips.
In 2017, nearly 50% of P&O Cruises' guests chose either to remove the service charge from their on-board accounts, or to pay a service charge which differed to the amount to the one that had been applied to their account. Approximately 65% of those guests chose to adjust or remove the discretionary service charge within the first two days of their holiday. The percentage of guests adjusting or removing their service charge at the end of the cruise was about 1%. They believed those statistics demonstrated that guests were aware the charge was discretionary, and they were happy to pay the discretionary service charge or had already acted to adjust or remove it.
They pointed out that the small print in their advertising was already restricted in terms of the space available and the relevant information that was required to appear there. They considered that adding additional text into the advertising terms would be challenging and they provided further detail about the ways in which the existence of the discretionary service charge was highlighted in materials designed to be read before booking, after booking and whilst on-board.
Assessment
Not upheld
The ASA noted that the ads provided information about the different cruises and package options available from P&O Cruises, such as pricing information; the routes available; some of the on-board services offered, such as on-board entertainment and five-course dining; and that there were various cabin types available. The ads also set out that “extra on-board spending money” was offered with some of the cruises.
We considered consumers would therefore infer that there were a number of variables to consider when choosing a cruise package. In light of that, we considered they would understand that the ads were providing some general initial information about the cruises available for purchase and that the ads were inviting consumers to seek further information with a view to purchasing one of the cruises and determining in more detail, at a later stage, which particular cruise package was best suited to their needs and budget.
We acknowledged that the ad specifically referred to “on-board spending money” and understood that the optional service charge was taken from the same on-board account into which the spending money was put. However, we considered that most consumers would see the optional service charge as a separate (and optional) cost to the spending money they received within their cruise package. We considered they would understand that any service payments they wished to make would come from their wider budget.
Although we acknowledged the complainant’s view that his on-board spend promotional amount was effectively £3 (£45 minus a service charge of £6 per night for seven nights), we understood that the service charge was optional and noted that around half of P&O Cruises’ guests chose either to remove the service charge from their on-board accounts, or to pay a service charge which was different in amount to that applied to their on-board account. We considered that many consumers would find the mechanism in place a practical way of paying a service charge, which they were generally content to do.
Moreover, we did not consider that the optional service charge or information expressly detailing the mechanism for making that optional payment (namely automatically taking the charge directly from an on-board account) was material information that would influence a consumer’s transactional decision to seek further detail about the various cruises advertised in ads (a) and (b). We therefore concluded that the ads were not misleading.
We investigated the ads under CAP Code (Edition 12) rules
3.1
3.1
Marketing communications must not materially mislead or be likely to do so.
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),
3.10
3.10
Qualifications must be presented clearly.
CAP has published a Help Note on Claims that Require Qualification.
(Qualification) and
3.17
3.17
Price statements must not mislead by omission, undue emphasis or distortion. They must relate to the product featured in the marketing communication.
(Prices), but did not find them in breach.
Action
No further action necessary.
