Summary of Council decision:
Two issues were investigated, both of which were Upheld.
A pre-roll ad on YouTube, seen on 13 March 2017, opened with a video of entrepreneur Tai Lopez, pointing a camera to himself in a “selfie”-style. He then began talking to the camera while walking through a house. He first said, “What’s the simplest way for you to make six figures? Easy, break it down like this – eight people paying you a thousand dollars a month or four people paying you 2000 dollars a month. Now, who can afford to do that? Most individuals can’t afford to pay you like that but businesses can. But why would a business pay you? Well almost every business sucks at marketing and wants more customers. If you can get them more customers they will gladly open their chequebook. Especially around social media marketing; most business owners are old, they don’t understand it at all. So I’ve created a small test group.”
He then pointed to an area of the screen and said, “I’ve got a link to it. I’ve got it open for eight more hours. I’ve been training people and the testimonials are pouring in how they’re getting small businesses to pay them $1,000 – $10,000 dollars a month. This link below, if you go there in eight hours it’s going to be gone, it’s not going to work, it will have a wait list. So don’t procrastinate, you owe it to yourself. The thing that changed my life was taking matters into my own hands. Looking out for my own destiny. Becoming an entrepreneur. Check out that link below in the next eight hours."
1. The complainant, who said the link advertised in the video lasted longer than eight hours, challenged whether the ad was misleading.
2. The ASA challenged whether the claim that consumers could make between $1,000 and $10,000 a month by using the techniques described in the ad was misleading and could be substantiated.
Mas Group Ltd t/a Tai Lopez said in their response that the video was no longer running online and had been removed from YouTube.
1. Tai Lopez could not verify the assertion that the link in the ad lasted more than eight hours. He believed that even if it was a mis-statement it was not material because it was difficult to see what consumer harm could have come from the link having remained open for more than eight hours.
Tai Lopez said that their practices and procedures regarding time limited claims had changed and that they had made technical changes to their linking technology in their ads so links expired appropriately.
2. Tai Lopez said their Social Media Marketing Agency (SMMA) marketers had a very decent prospect of earning $1,000 a month and as much as $10,000 a month. Tai Lopez provided signed testimonials from a number of people who had joined the SMMA scheme which included video testimonials, social media posts and emails. Those testimonials included assertions that they had earned sums ranging from $1,000 to $10,000 in a single month.
Tai Lopez said that in order to avoid unrealistic consumer financial expectations the ad also contained the disclaimer "Tai is a professional internet marketer and his results are not typical. His experiences are not a guarantee you will make money. Most who order the program make little to no money." Tai Lopez said the goal of the program was not to make those who signed up to it independently wealthy but to give them the skills to earn a modest income. On reflection, they recognised that the words "Most who order the program make little or no money" could be seen as inconsistent with the earnings claims. They clarified that they did not, in fact, know whether or not most people would make no money, but they believed the opposite could just as easily be true. They said they would endeavour to be more precise in their language where disclaimers were necessary in future ads.
The ASA noted that in the ad, Tai Lopez made a clear statement that the link to his SMMA program was open for “eight more hours” and that “quote what he actually says about the wait list. He said, “This link below, if you go there in eight hours it’s going to be gone, it’s not going to work, it will have a wait list.” The ad then explicitly encouraged the user to click on the link, when Tai Lopez said, “So don’t procrastinate, you owe it to yourself”.
We noted that Tai Lopez could not verify that the link had only been active for eight hours and that the complainant had been able to access it more than eight hours after the ad appeared. While we welcomed the changes Tai Lopez made to their marketing, we considered that because the ad said the link was open for eight hours when it was not, consumers had been deprived of time or opportunity to make an informed choice. We therefore concluded that the ad 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 3.31 3.31 Marketing communications must not falsely claim that the marketer is about to cease trading or move premises. They must not falsely state that a product, or the terms on which it is offered, will be available only for a very limited time to deprive consumers of the time or opportunity to make an informed choice. (Availability).
We accepted the testimonials that Tai Lopez had provided showed that SMMA marketers could earn sums between $1,000 and $10,000 in a single month. However, we also noted that in spite of that a disclaimer had been added (which we did not see in the version of the ad that appeared in the UK) which said “Tai is a professional internet marketer and his results are not typical. His experiences are not a guarantee you will make money. Most who order the program make little to no money”.
The explanation Tai Lopez provided – that most people would earn little to no money – appeared to be at odds with the content of the video. The ad began with Tai Lopez in what appeared to be his home, a large mansion, smiling. He said, “What’s the simplest way for you to make six figures? Easy, break it down like this.” The use of the words “easy” and “simplest” suggested that most consumers would not find it hard to make “six figures”.
Tai Lopez also explained that if consumers could get businesses more customers through marketing, then those businesses would “gladly” open up their chequebook for them. We considered the word “gladly” also reinforced the perception of ease that consumers could make money using the SMMA scheme. He then clarified that this assertion about marketing was particularly true in relation to social media marketing. He said, “Well almost every business sucks at marketing and wants more customers. If you can get them more customers they will gladly open their chequebook. Especially around social media marketing; most business owners are old, they don’t understand it at all.”
Later on in the ad he also said that testimonials showing that customers were earning $1,000 to $10,000 a month were “pouring in”. Again, that reinforced the perception that there was a simple opportunity for consumers to make money with ease.
We considered that the overall impression of the ad was that by following the link provided, consumers would be given advice that would make it easy for them to earn between $1,000 and $10,000, and that the majority of those who followed the advice in the link would earn that amount.
We received 49 testimonials which showed that while some marketers earned less than $1,000, the majority of the group earned between $1,000 and $10,000, and that some had earned more than $10,000 in a single month. While we noted Tai Lopez's comments regarding the accuracy of the disclaimer and their view that it was not necessarily the case that "Most who order the program make little to no money”, we had nevertheless not seen evidence relating to the amounts earned by all of those who followed the link and joined the SMMA scheme.
For those reasons we considered that the evidence provided was not sufficient to substantiate the claims and we concluded that the ad 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 3.7 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).
The ad must not appear again in its current form. We told Tai Lopez not to state that an opportunity would only be available for a limited amount of time if that was not the case. We also told them not to misleadingly imply that the majority of people signing up to a marketing scheme would earn large sums of money unless they held adequate substantiation.