An online sales promotion for ASDA, seen mid-July 2015, stated "3 FOR £3 … ASDA Choco Squares … £1.38 … 3 for £3.00".
The complainant, who understood the price of the product was increased from 97p per box prior to the promotion, challenged whether the ad was misleading.
ASDA Stores Ltd said their Choco Squares cereal was priced at 97p per box between January 2015 and 5 July 2015, and at £1.38 from 6 July 2015. On 7 July 2015 the product was then included in a mix and match multi-buy offer of three packs for £3. The product price was then again changed, to £1.20 on 9 September 2015. They said the ad communicated the current selling price of £1.38 for an individual pack and that all other information was present in the ad in order for a customer to make an informed decision about whether or not to purchase the product. Furthermore, the ad did not make any implied comparison with the product’s past price. They said a customer could choose to purchase one pack of Choco Squares product for £1.38, or choose to buy three boxes for £3. ASDA said had the product not been included in the three for £3 offer at the time of the ad, a customer would have paid £4.14 for three boxes. Therefore, because Choco Squares were included in the offer, a customer would have saved £1.14 for the same number of products.
The ASA noted the Competition and Markets Authority’s (CMA) report “Pricing Practices in the Groceries Market”, published in July 2015 and produced in response to a super-complaint made by Which?. That report stated “The CMA considers that many of the same issues that arise in relation to reference price promotions can also arise in relation to volume promotions. In particular, where a volume promotion presents a particular saving to a consumer based on the purchase of multiple items, the consumer will take the price of an individual item as the benchmark for any saving. If the price of the individual item is artificially inflated, this could mislead the consumer as to the genuine price of the product in question”. We agreed with the CMA’s point of view.
We noted ASDA’s assertion that the ad clearly communicated the current selling price of an individual pack of Choco Squares as £1.38. However, we considered consumers were likely to understand that the individual pack price of £1.38 was both the current and the usual selling price, and that the promotional price of three for £3 therefore represented value for money when multiple items were purchased. We considered the promotion was likely to encourage consumers to purchase multiple packs of Choco Squares when previously they might have purchased only one, based on the ad’s suggestion that a genuine saving was available.
We understood the product had been priced at 97p for around six months up to 5 July and that it was changed to £1.38 on 6 July, which represented an increase of 42%. The product then became part of the multi-buy offer on 7 July, one day after the price was increased. We considered that the price of 97p was clearly the usual selling price at the time the multi-buy offer was introduced, rather than £1.38, as suggested by the ad.
Because the ad suggested the usual selling price of their Choco Squares was £1.38, and implied a saving could be achieved against the usual selling price when that was not the case (indeed, when the multi-buy unit price was more expensive than the usual selling price), we concluded that it 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. (Misleading advertising) 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).
The ad must not appear again in its current form. We told ASDA Stores Ltd to ensure their future promotions did not mislead about the savings consumers could achieve.