Background

Summary of Council decision:

Two issues were investigated, both of which were Upheld.

Ad description

A product page on www.groupon.co.uk, promoting an offer on Redfoot Leather Loafer Shoes, seen on 2 March 2018, featured text that stated "Difference 84% £140 [strikethrough price] £21.98".

Issue

1. The complainant challenged whether the savings claim was misleading and could be substantiated.

2. The ASA challenged whether the presentation of the pricing information was misleading, because it did not make clear the applicable cost of delivery.

Response

MyCityDeal Ltd t/a Groupon stated that they made an error by using an out-of-date RRP, which they had fixed.

Groupon stated that they were aware of the need to make their delivery charges more prominent, and that they had started to include those on both the product page and the previous search results page.

Assessment

1. Upheld

The ASA noted Groupon’s comments that the savings claim was based on an out-of-date RRP. However, in the absence of any qualification in the ad regarding the basis of that higher price, we considered that consumers were likely to understand that £140 represented the price at which the product was usually sold on Groupon, and that the claim "Difference 84% £140 [strikethrough price] £21.98" was based on that usual selling price.

Groupon were not able to demonstrate that £140 was the price at which the product was usually sold by them. Although we welcomed its actions to correct the error, because the advertised discount did not represent a genuine saving, we concluded that it was likely to mislead.

On that point, 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),  3.7 3.7 Before distributing or submitting a marketing communication for publication, marketers must hold documentary evidence to prove claims that consumers are 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  3.17 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).

2. Upheld

We noted that the advertised price of £21.98 did not include the delivery fee. The CAP Code rules on misleading advertising and pricing required that, to avoid misleading consumers, quoted prices should state the applicable delivery fee. The only exception was when those fees could not be calculated in advance.

We understood that the delivery fee was fixed at £1.99 and was therefore calculated in advance by Groupon. It was not included in the advertised price on the initial search results page and when a consumer clicked on the item from that page they were taken to the individual product page, which did show the fee, but it was presented separately from the advertised price. We considered that the advertised price inclusive of the cost of delivery should have been made clear as soon as the price was quoted.

Because the ad did not make clear the total price including the delivery charge, we concluded that it was misleading.

On that point, 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  3.20 3.20 Marketing communications that state prices must also state applicable delivery, freight or postal charges or, if those cannot reasonably be calculated in advance, state that such charges are payable.  (Prices).

Action

The ad must not appear again in its current form. We told Groupon Goods Global GmbH to ensure that they did not make savings claims that were likely to be understood as being based on the prices at which products were usually sold, unless they held adequate evidence to substantiate those claims. We also told Groupon to ensure that they made clear the total price including the delivery charge as soon as the product price was quoted.

CAP Code (Edition 12)

3.1     3.17     3.20     3.7    


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