Ad description
An ad on www.eonenergy.com, visited in October 2011, stated "Sign up for Dual Fuel on the E.ON Energy Fit Plan for 2 years, and we'll give you 2 months' worth of energy for free ... If you stay on our Energy Fit Plan for 2 years and pay by fixed monthly Direct Debit, we'll give you back 2 month's worth of your energy for free, one for each year! And we won't collect your Direct Debit payment in months 12 and 24".
Small print included "If you are currently receiving a Direct Debit discount you will no longer receive it on this plan".
Issue
RWE npower challenged whether the claim "2 months' worth of energy for free" was misleading, because the normal dual fuel direct debit discount had been removed to cover the cost.
Response
E.ON Energy Solutions (E.ON) said they had worded the offer in response to concerns expressed by Ofgem in March 2011 "... that unnecessarily high numeracy requirements could confuse customers, leading to poor switching decisions, or put them off switching altogether". They believed the new wording would have greater resonance for and be more comprehensible to consumers. They said the offer was designed to attract new customers to E.ON, who would switch from other suppliers, but that they did not wish to exclude existing E.ON customers, some of whom would be migrating from online fixed term savings plans when they ended but for whom E.ON were prohibited by Ofgem regulations from migrating automatically to another promotional product. Because the offer was open to those existing E.ON customers, E.ON took the decision to include the small print so that they would be aware of the significant condition that, if they already received a direct debit discount, they would not receive it under the advertised offer. They believed customers would understand that the discount offered by the advertised plan was instead of, rather than additional to, any discount they had received previously from E.ON. E.ON said they could have avoided the issue by excluding existing E.ON customers from the offer, but that they had not wished to exclude existing customers.
Assessment
Upheld
The ASA noted that the offer was open to customers who were new to E.ON and to existing customers, who may or may not already have been receiving a discount for paying by direct debit. We noted that small print stated "If you are currently receiving a Direct Debit discount you will no longer receive it on this plan". We considered, however, that, for customers who were already receiving a discount for paying by direct debit, the main claim that they would not be charged for two months' worth of energy was misleading, because it did not take into account the discount they had already been receiving for paying by direct debit, which they would lose if they took up the offer. We considered that, for those customers, the small print contradicted rather than qualified the offer and concluded that the ad was, therefore, 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. (Misleading advertising), 3.9 3.9 Marketing communications must state significant limitations and qualifications. Qualifications may clarify but must not contradict the claims that they qualify. (Qualification) and 3.25 3.25 Marketers must not describe an element of a package as "free" if that element is included in the package price unless consumers are likely to regard it as an additional benefit because it has recently been added to the package without increasing its price. (Free).
Action
The ad must not appear again in its current form.
