Background

Summary of Council decision:

Two issues were investigated and were Not Upheld.

Ad description

a. Claims on www.vodafone.co.uk stated "A Vodafone Freedom Freebee on Pay as you go gives you over £50 of calls to standard UK mobiles and landlines (starting 01, 02, 03) plus standard UK texts and 50MB of UK web access - all for just £10".

b. A TV ad for Vodafone stated "Feel free with Vodafone. Buy a £10 pay as you go Freedom Freebee and you'll get over £50 worth of calls and texts plus 50MB of free web access". On-screen text stated "Lasts 30 days. Standard UK texts, web access & calls to mobiles & landlines (starting 01, 02, 03). Max one Freebee. Terms apply".

Issue

Telefonica challenged:

1. whether the claim "£50 worth" of calls and texts and similar in both ads was misleading because, given the prevalence of "added value" packages, they believed very few consumers paid standard tariff rates for texts and calls, which they believed were the tariff rates on which the £50 value was based; and

2. whether the implication that £50 worth of calls could be bought for £10 was misleading, because they believed the offer had run for more than six months, and that the £10 price had therefore become established, which meant that the package was no longer "worth" £50.

Response

1. Vodafone said that, since 1 September 2008, all new Vodafone pay as you go (PAYG) customers joined the "Vodafone Simply" PAYG price plan. Vodafone supplied a copy of the price plan. Vodafone said the price plan provided for standard charges against the customer's prepaid credit balance when making calls, texting or using data. They said that, unless the customer proactively opted to add a "bolt-on" offering certain allowance benefits, the customer would pay the Vodafone Simply (standard) charges until the prepaid credit had been used.

They said that, at point of sale, customers could purchase the Vodafone Freedom Freebee as an alternative to Vodafone Simply. Freedom Freebee could be purchased at £10, £15, £20 or £30 for greater minutes, texts and web access allowances respectively and needed to be used within a 30-day period. After that, they would need to purchase another Freedom Freebee or be charged standard Vodafone Simply price plan rates.

Vodafone said the ads made a comparison between Vodafone Freedom Freebee and Vodafone Simply to highlight the additional allowance of minutes, texts and data they could benefit from with Freedom Freebee. They said a customer could purchase standard top up and then opt into a Vodafone Freebee, but could not purchase Vodafone Freedom Freebee and opt into a different Vodafone Freebee until the Freedom Freebee had expired. They said customers could purchase standard top up (Vodafone Simply) and/or add a specific Vodafone Freebee to meet their needs if Freedom Freebee was not suitable for them, but that the ads simply made a comparison. They said Vodafone had not received complaints direct to them from their customers on the investigated point. Vodafone supplied details of the number of active customers on Freedom Freebee against those on other Freebees or Vodafone Simply or other standard PAYG tariffs for the months of October, November and December 2011.

Clearcast endorsed Vodafone's response in respect of ad (b). They supplied a copy of the substantiation they had received from Vodafone when the ad was submitted to them and which referred to the "standard price plan rate" which Freedom Freebee provided benefits beyond.

2. Vodafone said the price comparisons were accurate, up to date and reflected the products featured in the ads. They said Freedom Freebee was a PAYG product comparable to, and which sat alongside, Vodafone Simply and was not a temporary offer. They did not believe it was misleading to compare two existing price plans and to highlight the allowance or value benefit between products. They believed the "£50 worth" and similar claims were justified.

Clearcast endorsed Vodafone's response in respect of ad (b). They said the bundle of calls, texts and web access (Freedom Freebee) that was advertised was introduced on 1 June 2010 and so had not been available for six months when Telefonica first saw the ad. They said the previous package did not contain web allowance, and so to include web allowance in the new package made it new and unestablished. They believed it was fair to describe the total bundle (Freedom Freebee) as being worth £50 because they considered it was a new and unestablished promotion.

Assessment

1. Not upheld

The ASA noted that Telefonica believed the ads were misleading because they understood that the standard price tariff on which the price comparison was based was not the price that consumers typically paid. We noted, however, that the figures Vodafone had supplied showed that a significant proportion of their customers were on the Vodafone Simply tariff and were, therefore, charged the rates against which the price savings comparison claims were made. Those customers, therefore, would pay £10 for the calls, texts and data bundle that they would pay more than £50 for on the Vodafone Simply tariff. We considered it was not unreasonable for Vodafone to make a price comparison claim for Freedom Freebee in relation to the tariff to which new customers would join and which applied to a significant number of PAYG customers. Because of that, we considered that the comparison was justified and concluded that the claims were not misleading.

On this point we investigated ad (a) under CAP Code (Edition 12) rules  3.1 3.1 Advertisements must not materially mislead or be likely to do so.  and  3.3 3.3 Marketing communications must not mislead the consumer by omitting material information. They must not mislead by hiding material information or presenting it in an unclear, unintelligible, ambiguous or untimely manner.
Material information is information that the consumer needs to make informed decisions in relation to a product. Whether the omission or presentation of material information is likely to mislead the consumer depends on the context, the medium and, if the medium of the marketing communication is constrained by time or space, the measures that the marketer takes to make that information available to the consumer by other means.
 (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  3.1 3.1 Advertisements must not materially mislead or be likely to do so.   (Prices) but did not find it in breach.

On this point we investigated ad (b) under 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) but did not find it in breach.

2. Not upheld

We noted that the price comparison claim reflected the rates charged on Vodafone Simply and Freedom Freebee respectively; that Vodafone Simply and Freedom Freebee were two separately available products and that the Freedom Freebee price rates were not a temporary offer. We noted that CAP and BCAP advised that, when a new product was added to a pre-existing call plan, there was a six-month period after which the new element could not continue to be described as "free". For a straight price comparison, however, we considered it was reasonable for a comparison claim to continue to be made as long as the respective prices were representative of what customers in those circumstances paid. Because the prices that were compared continued to be representative of what customers in the respective circumstances paid, we considered that it was reasonable for the claim to continue to appear and concluded that the claims were not misleading.

On this point we investigated ad (a) under CAP Code (Edition 12) rules  3.1 3.1 Advertisements must not materially mislead or be likely to do so.  and  3.3 3.3 Marketing communications must not mislead the consumer by omitting material information. They must not mislead by hiding material information or presenting it in an unclear, unintelligible, ambiguous or untimely manner.
Material information is information that the consumer needs to make informed decisions in relation to a product. Whether the omission or presentation of material information is likely to mislead the consumer depends on the context, the medium and, if the medium of the marketing communication is constrained by time or space, the measures that the marketer takes to make that information available to the consumer by other means.
 (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  3.1 3.1 Advertisements must not materially mislead or be likely to do so.   (Prices) but did not find it in breach.

On this point we investigated ad (b) under 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) but did not find it in breach.

Action

No further action necessary.

BCAP Code

3.1     3.18     3.9    

CAP Code (Edition 12)

3.1     3.17     3.3     3.7    


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