A TV ad for Dormeo UK Ltd, seen on 2 May 2021, featured a voiceover that stated, “Right now, the Memory Classic mattress is half price …” On-screen text accompanying the voiceover stated “HALF PRICE”, and a box with numbers counting down from £399 to £199 appeared, with the words HALF PRICE showing above the final figure. More on-screen text appeared, stating “OFFER MUST END MONDAY!” as the voiceover continued, stating “… but you must hurry, this half price offer ends on Monday.”
IssueThe complainant, who understood that Dormeo usually sold the mattress for £199, challenged whether the savings claim was misleading.
Dormeo told the ASA that they considered their product pricing had followed the relevant Code rules and guidance, and provided the pricing history for the Memory Classic Mattress between January and July of 2021, including information about the number of units sold when the mattress was full price, and when it had been discounted.
Dormeo said that they expected sales to be higher during the promotional periods due to the price difference, but also because during non-promotional periods the product had been de-ranked on e-commerce sites, had not been featured on their home page promotions, and had appeared lower on product listings and in on-site search results.
Clearcast said that the ad had been approved on 28 October 2020, and had been accompanied by signed copy of the retail substantiation form which had stated that the higher price had previously been offered from 4 February 2020 to 2 March 2020, and that the new lower price would be offered between 3 March 2020 and 30 March 2020. They said that this was considered satisfactory at the time, and seemed to be in accordance with normal Clearcast practices.
The ASA considered that consumers would understand the claim “half price”, coupled with the graphic counting down from £399 to £199, to represent a genuine saving against the usual selling price of the product at the time the ad appeared.Rule 3.18 3.18 Price statements must not mislead by omission, undue emphasis or distortion. They must relate to the product or service depicted in the advertisement. of the BCAP Code required that price statements must not mislead by omission, undue emphasis, or distortion. The CTSI Guidance for Traders on Pricing Practices offered practical advice to traders on consumer protection laws and associated practices. While we noted that the guidance provided a set of principles rather than statutory rules, and broadcast advertising claims were ultimately assessed under the BCAP Code, we took the Guidance into account when making our assessment.
The Guidance stated that any specific price advantage claimed by advertisers must not be misleading or unfair, and required advertisers who used pricing practices which indicated a saving against another price to be satisfied that their quoted saving was genuine, and therefore not unfair. The Guidance stated that advertisers should consider how long the product was on sale at the higher price, compared to the period for which the price comparison was made, and advised that a practice was less likely to comply if a comparison was made for a materially longer period than the higher price was offered.
The Guidance did not give specific advice on situations where that practice was repeated on a regular basis for the same product. However, we considered it was relevant to consider the fluctuations in the context of the consumer understanding set out above, that the higher price would be the usual selling price of the product.
The dates and figures provided by Dormeo showed that the Memory Classic Mattress had been offered at the “half price” figure referenced in the ad for a slightly longer period than it had been available at the listed “full price”. Dormeo said that over the 365 days of the year, the mattress was shown at the higher price for 182 days, or 49.85% of the year, and at the lower price for 183 days, or 50.14% of the year. The information also showed that the two prices had followed a monthly ‘on-off’ pattern between January and July of 2021, alternating between those two prices. This broke down as, starting from January, 32 days at the lower price, then 28 days at the higher price; a further 28 days at the lower price, followed by 35 days at the higher price; 28 days at the lower price, then another 28 days at the higher price, concluding in July, with 28 days at the lower price.
We considered that those figures and dates showed that the periods when a promotion ran were essentially equivalent in length to when there was no promotion running. We did not consider that the intervening periods between the promotions were sufficient in length to establish that the higher price of the product was the usual price. Also, we considered that those regular fluctuations would have been likely to affect consumers’ perceptions of the value of the offer, and whether the claimed saving was genuine.
We also noted that the CTSI guidance advised that a practice was less likely to comply if a retailer could not provide evidence to show that significant sales were made at the higher price when compared to the promotional price. A retailer should not repeatedly use a reference price while knowing that they had not previously sold a significant number of units at that price.
Dormeo also provided information about units sold during the periods the mattress was at full price, and when it had been discounted. Those figures showed that during the promotional periods of January, March and May, 4,086 units, 1,941 units and 1,806 units were sold, respectively, totalling 7,833 units sold at the discounted price. For the months of February, April and June, when the mattress was sold at full price, the figures showed that 49 units, 68 units and 79 units were sold respectively, totalling 196 units sold at the “full price”.
We also considered that the sales data that Dormeo provided to us did not demonstrate that there were significant sales at the higher selling price outside of the promotional periods, which we considered was relevant in establishing whether the higher prices were the usual selling prices.
Because consumers were likely to understand that the claimed saving represented a genuine saving against the usual selling price of the product, when we had not seen evidence to substantiate that was the case, we concluded that the savings claim was misleading.
The ad breached BCAP Code rules 3.1 3.1 Advertisements must not materially mislead or be likely to do so. (Misleading advertising), 3.9 3.9 Broadcasters must hold documentary evidence to prove claims that the audience is likely to regard as objective and that are capable of objective substantiation. The ASA may regard claims as misleading in the absence of adequate substantiation. (Substantiation) and 3.18 3.18 Price statements must not mislead by omission, undue emphasis or distortion. They must relate to the product or service depicted in the advertisement. (Prices).
The ad must not appear again in its current form. We told Dormeo UK Ltd to ensure that future savings claims did not mislead and to ensure they substantiated savings against the usual selling prices of their products.