A direct mailing for Zzoomm, a broadband provider, received on 5 July 2023, featured a series of savings claims. Headline text at the top of the letter stated “Upgrade to 100% Full Fibre broadband and save over £240 a year”. Text in the body of the letter stated “When your neighbours are stuck paying for their over-priced, part fibre BT broadband […] you can sit back and enjoy a brand-new Full Fibre connection, and save a fortune! You could save £240.18 a year by switching to Zzoomm Full Fibre 150 for just £19.95 a month for 12 months compared to BT Fibre 1 at £29.99 a month for 24 months”.
The letter included a pricing comparison table comparing Zzoomm’s Full Fibre 150 service to Sky’s Superfast 35 service, BT’s Fibre 1 service, and Plusnet’s Unlimited Fibre service. The table listed Zzoomm’s service as costing £19.95 a month over a 12-month term, for a total of £239.40, and BT’s service as costing £29.99 a month over a 24-month term, for a total of £719.76 as well as comparisons against other providers.
Small print at the end of the letter stated “Offer terms. Save £10 a month on all Zzoomm 12-month home broadband plans […] Save £240.18 a year vs BT Fibre 1 calculated by comparing BT Fibre 1 Total Contract Value of £719.76 minus Zzoomm Full Fibre 150 Total Contract Value £239.40 and pro-rating to 12-month equivalent. Pricing comparison table […] correct as of 20/06/2023.”
The complainant challenged whether the claim “save over £240 a year” was misleading and could be substantiated.
Zzoomm said that the price comparison table compared four broadband services available in the relevant postcode, which was within their full fibre broadband network. They said they offered the only full fibre broadband product available in that area and that all available pricing had been correct when the ad was seen.
Zzoomm said the claim that consumers could save over £240 a year by changing to their Full Fibre 150 service had been calculated by estimating the cost of their service over 24 months, and comparing that against the cost of 24-month BT Fibre 1 contract. Upon re-checking the price comparison table, Zzoomm accepted that the calculations had been incorrect due to human error, for which they apologised.
The ASA considered that consumers would understand the claim “Upgrade to 100% Full Fibre broadband and save over £240 a year” to mean that they would be able to save £240 per year by switching to Zzoomm’s Full Fibre 150 service from a BT Fibre 1 service. The ad stated “You could save £240.18 a year by switching to Zzoomm Full Fibre 150 for just £19.95 a month for 12 months compared to BT Fibre 1 at £29.99 a month for 24 months”. We noted that the lengths of the contracts differed, and considered consumers would understand that they would save over £240 over the 12-month Zzoomm contract versus what they would have paid to BT over that period, and that they could save the same amount with a second 12-month contract to cover the full 24 months of the BT contract.
However, we understood that Zzoomm had calculated the saving by deducting the total cost of a 12-month Zzoomm contract (£239.40) from the cost of what they had calculated for a 24-month BT contract (£719.76), leaving a saving of £480.46. However, that did not take into account the cost of the Zzoomm contract for the second year. The correct calculation should have been to subtract two 12-month Zzoomm contracts (£478.80) from the 24-month BT contract (£719.76), leaving a saving of £240.96. That was the amount identified in the advertiser’s response to the complaint. However, that was the total across 24 months, whereas the ad stated an amount that consumers could save per year. The saving per year according to the above calculation would be £120.48.
In addition, we noted from the small print of the ad that the offer applied a £10 discount to 12-month home broadband plans, meaning that the regular cost of their Full Fibre 150 service would have been £29.95. We noted from the ad that the offer was due to end on 31 August 2023, and Zzoomm also reserved the right to withdraw it at any point. Because there was no guarantee that consumers would be able to pay the discounted rate of £19.95 in a hypothetical second year, we considered that further undermined the claimed saving.
Because the ad claimed that consumers switching from BT’s Fibre 1 service could save over £240 a year if they signed up to Zzoomm’s Full Fibre 150 service when that was not the case, and because the ad implied that the monthly cost of £19.95 could be extrapolated over a 24-month period, when there was no evidence that consumers would be able to take advantage of that price once the 12-month offer period had ended, we concluded that the savings claims in the ad had not been substantiated and were therefore misleading.
The ad breached CAP Code (Edition 12) rules 3.1 and 3.3 (Misleading advertising), 3.7 (Substantiation), and 3.33 and 3.35 (Comparisons with identifiable competitors).
The ad must not appear again in the form complained about. We told Zzoomm plc to ensure that their future marketing materials did not mislead consumers. Specifically, we told them to ensure future ads contained accurate savings figures which could be substantiated. We also told them to ensure that any future price comparisons they made were accurate and could be substantiated.