Background
Summary of Council decision:
Three issues were investigated, all of which were Upheld.
Ad description
The website www.emoov.co.uk, for an estate agent, seen on 2 February 2016 stated “Looking to sell your home? Half Term: Sign up now & receive £220 off”. The website also stated “We’re local everywhere. We’ve sold in 98% of UK postcodes”. The ad included a comparison table, with the Brixton branch of Foxtons estate agents, which included various features such as number of listings, asking price and selling fee. The table stated “Compare us to traditional estate agents. Foxtons customers would have saved £13,449 … emmov National … Selling Fee … £595 … Foxtons Brixton … Selling Fee £14,044”.
Issue
1. The complainant, who understood that the same money off promotion had been offered prior to the current promotion, challenged whether the claim “Half Term: Sign up now & receive £220 off”, was misleading.
They also challenged whether the following claims were misleading and could be substantiated:
2. “We’ve sold in 98% of UK postcodes”; and
3. “Foxtons customers would have saved £13,449”.
Response
1. EMOOV LTD said that they had run two other promotions, one for Valentine’s Day and another for Mothers’ Day, and both had the same money off offer and terms and conditions.
2. EMOOV provided a data sheet which they said supported the claim that they had “sold in 98% of UK postcodes”. They said that the majority of their customers would understand the word ‘postcodes’ to mean ‘postcode areas’.
3. EMOOV said that the claim “Foxtons customers would have saved £13,449” was in fact lower than what Foxtons’ customers would have saved as they purposefully erred on the side of caution. They said the calculation was based on figures taken in late 2015, at which point the average asking price for Foxtons Brixton, London, on a particular online property listing site was £585,167. EMOOV said the calculation was based on a 2% commission rate which was a typical fee for London estate agents and that this rate was far lower than Foxtons’ standard fee. Therefore, they said the savings calculation was a conservative estimate, with the actual savings being far greater. They said Foxtons’ terms and conditions showed that their lowest rate of commission was 2.7%. They said although it was possible for Foxtons to offer services at a discounted rate on occasions, that was likely to occur infrequently. Furthermore, they said that by using the lowest commission fee offered by Foxtons, savings would be £14,717.19; a higher commission fee would mean savings of £19,821.25.
Assessment
1. Upheld
The ASA considered that consumers were likely to understand that the offer “Half Term: Sign up now & receive £220 off” was time-limited and although the ad omitted a specific closing date, most consumers would understand that ‘half term’ related to defined dates around school holidays. We understood from the complainant that prior to the half-term offer a similar promotion appeared on EMOOV’s website. That offer had a closing date of the end of January with the same reduction of £220. We therefore considered that EMOOV had promoted the same offer on two subsequent occasions in close succession.
We noted that the CAP Code stated that closing dates must not be changed unless circumstances outside the control of the promoter made it unavoidable and either not to change the date would be unfair to those who sought to participate within the original terms, or those who sought to participate within the original terms will not be disadvantaged by the change. EMOOV had not provided any rationale as to why they had promoted the same offer which closed at the end of January and the subsequent half-term offer, apparently within a relatively short time after the previous one had ended. We considered that, because each offer was subsequently replaced with a similar promotion albeit with a different closing date, EMOOV had in effect extended the time to respond to the offer, changing closing dates on consecutive occasions. Therefore, consumers who had taken up the initial offer may have hurried into participating in the promotion believing it was about to end, when they could have delayed taking part until a more convenient time.
Because of that, we concluded that the promotion was misleading and in breach of the CAP Code.
On this point the ad breached CAP Code (Edition 12) rules
8.17
8.17
All marketing communications or other material referring to promotions must communicate all applicable significant conditions or information where the omission of such conditions or information is likely to mislead. Significant conditions or information may, depending on the circumstances, include:
8.17.4
8.17.4
Closing date
and
8.17.4.e
8.17.4.e
Closing dates must not be changed unless unavoidable circumstances beyond the control of the promoter make it necessary and either not to change the date would be unfair to those who sought to participate within the original terms, or those who sought to participate within the original terms will not be disadvantaged by the change.
(Significant conditions for promotions).
2. Upheld
We noted that the ad claimed that EMOOV had “sold in 98% of postcodes”. We considered that consumers were likely to understand that claim implied they had sold properties in a general postcode district within the UK which related to an area covered by the first part of a postcode, such as ‘SE5’, rather than in each specific full postcode, that is, a specific street or streets. We reviewed the data provided but noted that it related to broader postcode areas (for example, ‘SE’) and did not show that EMOOV had sold at least one property in each postcode district. In light of that, we considered that the claim had not been substantiated and concluded that it was misleading.
On this point the ad breached under 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).
3. Upheld
We noted that the ad stated “Foxtons customers would have saved £13,449” and additional wording referenced one Foxtons branch in Brixton. We considered that although the ad referenced Foxtons, and specifically their Brixton branch, the overall impression of the ad, particularly the references to “Foxtons customers …”, was that, on average, customers who chose to sell their property with EMOOV as opposed to Foxtons, would save around £13,449. In the context of the claim “Compare us to traditional estate agents”, we also considered that consumers would believe the savings claim was indicative of what they could achieve more generally if using EMOOV as opposed to a traditional high street agent.
We understood that the savings claim was based on a comparison between the selling fee that applied to EMOOV’s average national asking price against the fee that applied to Foxtons Brixton’s average selling price, as opposed to a comparison between the fees levied for the same value property. We noted that while EMOOV was a national company, Foxtons was based in Greater London and that there was a difference of £270,487 between the ‘asking prices’ quoted in the ad. Given the quoted average asking price for Foxtons was significantly higher, and would impact upon the corresponding commission fee, we considered that this disparity exaggerated the likely savings that could be achieved by using EMOOV.
In addition, the fee quoted in EMOOV’s figures represented their lowest fee option and excluded optional add-ons that could increase the overall costs. Therefore, we considered in the absence of any qualification, the quoted fee was not necessarily representative of the costs that all EMOOV customers paid.
For those reasons, we considered that EMOOV had not demonstrated that the savings claim was representative of the amount that consumers could save by opting for EMOOV’s services instead of a traditional high street agent and concluded the claim was misleading and had not been substantiated.
On this 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.
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) 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).
Action
The ad must not appear again in its current form. We told EMOOV LTD to ensure closing dates of promotions were not extended unless circumstances outside their reasonable control made it unavoidable, not to claim that they had sold properties in 98% of UK postcodes or that their customers could save specific amounts of money compared to traditional high street agents in the absence of adequate substantiation.
CAP Code (Edition 12)
3.1 3.3 3.7 8.17 8.17.4 8.17.4.E
