Ad description
A page on the website of The Britannia Coin Company, seen 26 April 2022, featured a promotion that offered participants the opportunity to win a James Bond themed 2kg gold coin. Under the heading “About the prize”, text stated, “The Britannia Coin Company is offering the chance to own a very rare, solid gold James Bond Coin, valued at £175,000”. In another section titled “About this raffle”, the page included information about the promotion’s conditions, including text that stated, “If fewer than 30,000 tickets have been sold to participants […] by the Closing Date, the Promoter has the right to: […] substitute for the Prize an alternative lesser cash prize of a value equal to 85% of monies received by the Promoter in ticket sales for the prize draw”.
Issue
The complainant, who understood that the prize, or a reasonable equivalent, had not been awarded, challenged whether the promotion breached the Code.
Response
Gold Traders (UK) Ltd t/a The Britannia Coin Company stated that to ensure the promotion’s compliance with all relevant laws and regulations, they had sought legal advice on the wording of its terms and conditions.
Prior to the promotion’s original closing date, it became apparent that ticket sales were unlikely to cover the cost of the advertised prize. At that stage, they believed they could extend the promotion’s closing date because that possibility had been indicated in its terms and conditions. However, before the original closing date they received ASA advice that, barring unavoidable circumstances beyond their control, extending the promotion was likely to breach the Code, unless not doing so would be unfair to those who had already entered. In an effort to comply with the ASA’s advice insofar as was possible, they did not extend the promotion’s closing date.
The ASA’s advice to them had also noted that they must award the advertised prize or a reasonable equivalent. However, they believed that the promotion’s inadequate ticket sales meant they were unable to do so. Because of that, they believed that their best option was to put all the proceeds from ticket sales into the prize pot. As such, on 20 May 2022 they awarded a randomly selected winner 100% of the value of all tickets sold, which amounted to £15,575.
Although they had originally intended to donate 10% of the value of all tickets sold to charity, the cash prize awarded meant that charitable donation would no longer be covered by ticket sales. In spite of that, they made a larger charitable donation equivalent to 20% of the value of all tickets sold.
Assessment
Upheld
The ASA considered that the ad made clear that the incentive for participating in the promotion was the prospect of winning a James Bond themed 2 kg gold coin that was worth £175,000. We considered that various elements, including the page’s heading and image, the James Bond quote, and the text “The Britannia Coin company is offering the chance to own a very rare, solid gold James bond coin, valued at £175,000”, contributed to that impression. We further considered that consumers would expect that, no matter how many tickets were sold, the winner would receive the advertised prize.
While we acknowledged that The Britannia Coin Company had overestimated the promotion’s ticket sales, we were concerned that their ability to award the gold coin was dependent on the number of tickets sold. We considered that meant there was a significant risk that they would not be able to award the advertised prize.
However, it was a requirement of the CAP Code that promoters must award the prizes as described in their ads or reasonable equivalents. We therefore considered that any promoter that needed to generate sufficient revenue from the competition to fund the advertised prizes was likely to breach the Code if they failed to sell the requisite number of tickets. The Britannia Coin Company had stated they had fallen short of their sales target and the cash prize of £15,575 was clearly not a reasonable equivalent to a 2 kg gold coin worth £175,000.
The terms and conditions stated, “If fewer than 30,000 tickets have been sold to participants […] by the Closing Date, the Promoter has the right to: […] substitute for the Prize an alternative lesser cash prize of a value equal to 85% of monies received by the Promoter in ticket sales for the prize draw”. In addition to our concern that the prize or a reasonable equivalent had not been awarded, we were concerned that it was not actually possible for prospective participants to know what the prize would be before buying a ticket. They could not know how likely it was that fewer than 30,000 tickets would be sold, how much would be generated from sales below that threshold or what the promotion costs would be.
We therefore considered that, even if that term had been prominently stated in the ads it would not have provided prospective participants with sufficient certainty as to the prize available.
For those reasons we considered that the promotion had not been administered fairly and that it was likely to have caused participants unnecessary disappointment.
The promotion breached CAP Code (Edition 12) rules
8.2
8.2
Promoters must conduct their promotions equitably, promptly and efficiently and be seen to deal fairly and honourably with participants and potential participants. Promoters must avoid causing unnecessary disappointment.
8.14
8.14
Promoters must ensure that their promotions are conducted under proper supervision and make adequate resources available to administer them. Promoters, agencies and intermediaries should not give consumers justifiable grounds for complaint.
and
8.15.1
8.15.1
Promoters must award the prizes as described in their marketing communications or reasonable equivalents, normally within 30 days.
(Promotional marketing).
Action
We told Gold Traders (UK) Ltd t/a The Britannia Coin Company to award the prize or a reasonable equivalent. We also told them to ensure in future that they awarded the prizes described in their ads for promotions, or reasonable equivalents.
