Text on the "Price plans" section of the Vodafone website, www.vodafone.co.uk, stated "Get a SIM only plan from just £10.50 a month. Available with a standard SIM, microSIM and nanoSIM". Various plans were featured and the monthly price of each plan was stated.
The complainant who believed that the monthly price could be increased during the contract, challenged whether the price claims were misleading.
Vodafone Ltd (Vodafone) said the monthly cost of their SIM only price plans were clearly stated on their website and related to the prices they charged customers on a monthly basis and therefore did not require qualification. The SIM only price plan was offered on a 30-day or 12-month minimum term contract and they said this was attractive to customers who already owned a handset and were looking for flexible minimum term commitments. Customers were encouraged to view details on the chosen plan by clicking the "plan details" link which created a "lightbox" which detailed information about the plan's allowance, contact information for their online support team and also linked to their terms and conditions. The "select" link directed them to the online purchase process where they were asked to agree to the online purchase terms and their Airtime Agreement and, on completing the online purchase process, were sent a SIM along with a welcome letter detailing the plan, a price plan guidance document and a full printed copy of their terms and conditions.
Their right to increase their line rental was in line with the increase in Retail Price Index (RPI) and was made clear in their Airtime Agreement. They said, although RPI could not be anticipated at the time of launching the price plan, any such price increase would be lower or in line with it. Their Airtime Agreement made clear that customers would be given at least 14 days’ notice before their charges were increased and if charges were incurred, other than those that resulted from a rise in VAT, they had a right to terminate their contract. They said these notification procedures were in accordance with the General Conditions of Entitlement under the Communications Act 2003 and that line rental increases were common across the telecommunications industry and minimum term agreement offers in general. They believed that customers made informed decisions by ascertaining the key features of a price plan, namely the minimum term commitment, line rental cost and the price plan allowance and that online advertising did not allow for excess information to be displayed in a small place. They used links in their advertising to take the customer through an online journey over several web pages where they said information was provided in a clear and unambiguous manner. They believed that including information about the potential for the monthly prices to increase during the contract would result in key information losing its prominence, especially if viewed on a smartphone, tablet or other smaller device.
The ASA acknowledged that the advertiser's right to raise prices in line with inflation within the term of the contract was stated in the terms and conditions that were provided as a link within the "plan details" section and were three clicks away from the stated prices. We also acknowledged that consumers had to agree to the terms and conditions prior to taking out a contract with Vodafone. However, we considered that because a monthly price was stated for each fixed-term contract, without any further qualification, consumers would be likely to understand that those prices would remain fixed for the entire term of the contract. We considered that the monthly price of a contract was likely to be of importance to consumers when deciding on a mobile phone contract and that the potential for it to increase, within the term of the contract, was a significant condition that needed to be stated clearly in the ad, without readers needing to click through to further web pages. Because the monthly prices were not qualified to make clear that they could be increased during the contract we concluded that they were misleading.
The ad breached CAP Code (Edition 12) rules
Marketing communications must not materially mislead or be likely to do so.
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) and 3.9 3.9 Marketing communications must state significant limitations and qualifications. Qualifications may clarify but must not contradict the claims that they qualify. (Qualification).
The ad must not appear again in its current form. We told Vodafone Ltd to qualify their monthly prices in future to make clear that they could be increased during the contract.