Background
Summary of Council decision:
Four issues were investigated, all of which were Upheld.
Ad description
Four ads shown on Amazon’s website and seen in July 2017 featured text that stated:
a. “LG 43UH603V 43 inch Ultra HD 4K Smart TV WebOS (HDR Pro, Local Dimming ColorPrime Pro, Ultra Surround) [Energy Class A+) by LG Electronics … RRP: £599.00 Price: £399.00 Deal Price: £379.00 You Save £220.00 (37%) … Dispatched from and sold by Amazon …”
b. “ViewSonic XG2703-GS 68.68 cm LCD/LED Gaming Monitor - Black/Green by Viewsonic Price: £752.00 Deal Price: £559.00 … You Save: £193.00 (26%) … Dispatched and sold by Amazon …”. On the right-hand side of the page was a box that included the text, “Lightning Deal £559 (Save 26%) … Prime Exclusive Deal This Deal is exclusively for Amazon Prime members” and below that was a button with the text “Join Prime”, and underneath that was the text “Already a member? Sign in”. At the bottom of the box was the text “Regular Price £752” which consumers could select.
c. “MSI GL62M 15.6-Inch Laptop (Black) - (Intel Core i5-7300HQ 2.5 Ghz, 8 GB RAM, 1 TB HDD, GeForce GTX 1050 Graphics, Windows 10 Home) + Hecate Gaming Backpack by MSI … RRP: £999.00 Deal Price: £699.00 … You Save: £300.00 (30%) … Dispatched from and sold by Amazon …”.
d. “Philips Sonicare Bluetooth Flexcare Platinum Electric Toothbrush & Sanitiser … by Philips RRP £270.00 Deal of the Day £84.99 … You Save: £185.01 (69%) … Dispatched from and sold by Amazon ….”
Issue
The ASA received four complaints.
1. One complainant challenged whether the claim “RRP: £599.00 Price: £399.00 Deal Price: £379.00 You Save £220.00 (37%)” in ad (a) was misleading and could be substantiated.
2. One complainant challenged whether the claim “Price: £752.00 Deal Price: £559.00 … You Save: £193.00 (26%)” in ad (b) was misleading and could be substantiated.
3. One complainant challenged whether the claim “RRP: £999.00 Deal Price: £699.00 ] You Save: £300.00 (30%)” in ad (c) was misleading and could be substantiated.
4. One complainant challenged whether the claim “RRP £270.00 Deal of the Day £84.99 … You Save: £185.01 (69%)” in ad (d) was misleading and could be substantiated.
Response
1. Amazon Europe Core Sarl stated that when recommended retail prices (RRPs) were displayed on amazon.co.uk for products that they sold, they strived to ensure that the savings claim represented a genuine saving for customers. They checked that the RRP was in line with the prices displayed for the relevant product on third-party websites and the prices of the relevant product as sold by third-party sellers on the amazon.co.uk Marketplace.
Regarding ad (a), Amazon stated that an error occurred when they checked other retailers’ pricing and that they should not have displayed the RRP. They said they were going to work on a solution to avoid this happening again and apologised for any inconvenience that it might have caused.
2. Amazon stated that the higher price shown in ad (b) was not an RRP, but the actual retail selling price of the product on Prime Day for non-Prime customers. They stated that they showed this price during their Prime Day event to make it clear that only Prime members could purchase at the “Deal Price” shown. They stated that the right-hand side of ad (b) showed that consumers could either select the “Deal Price” if they signed up to Prime (or signed in, if they were a member) or the “Regular Price” that was shown directly below the “Deal Price”.
Amazon stated that when they quoted a previous selling price as a reference price and compared it to a “Deal Price”, it would be labelled as a “Was” price. When calculating a “Was” price, they took into account any price fluctuations prior to the deal. However, for a “Price” claim displayed on Prime Day, it would represent the current retail selling price of the product for non-Prime customers for that particular day.
Amazon provided their pricing history for the advertised product and stated that it showed how there had been two price drops from £752 in the six weeks prior to Prime Day. Amazon explained that their retail prices fluctuated constantly because they sought to meet or beat the lowest competitive price for customers.
3. Amazon referred to the uk.camelcamelcamel.com data provided by the complainant in relation to ad (c), which showed their retail pricing history for the product and did not include third-party seller offers. Amazon stated that in the two weeks preceding the date for the advertised offer, three Amazon Marketplace sellers priced the product at £1,024.24, £1,026.69 and £1,061.66 and provided data which they considered supported that. However, no sales for the product were made on Amazon from the beginning of July 2017 to the date the ad was seen (24 July). Furthermore, their sales figures for the three months prior to the date when the ad was seen showed that the product was not on offer in April, May or June 2017.
Overall, Amazon considered that their data showed that the RRP displayed in ad (c) was a genuine price at which the product was generally sold.
4. Regarding ad (d), Amazon provided data to support the RRP claim and stated that it showed that three retailers had priced the item at or above the RRP. Two third-party retail websites priced the item at £270.00 and a third-party seller had marketed it at £284.54 on the amazon.co.uk Marketplace. Furthermore, their checks showed that the product was priced at £270.00 by third-party retail websites for 14 out of the 21 days that had passed in July before the complainant saw the RRP.
Overall, Amazon considered that their data showed that the RRP displayed in ad (d) was a genuine price at which the product was generally sold.
Assessment
1. Upheld
The ASA considered that consumers would understand the reference to an “RRP” to mean that the advertised product was generally sold at the stated price across the market.
We considered that to support an RRP claim, advertisers needed to show that the advertised product was offered and sold to consumers at that price in sufficient quantities by their competitors. We understood that the RRP claim in ad (a) was made in error and welcomed Amazon’s response that they were going to work on a solution to avoid that from happening again.
Therefore, because Amazon did not provide adequate evidence to support the savings claim in ad (a), we concluded that it had not been substantiated and was misleading.
On this point ad (a) breached CAP Code (Edition 12) rules 3.1 3.1 Marketing communications must not materially mislead or be likely to do so. (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 3.40 3.40 Price comparisons must not mislead by falsely claiming a price advantage. Comparisons with a recommended retail prices (RRPs) are likely to mislead if the RRP differs significantly from the price at which the product or service is generally sold. (Price comparisons).
2. Upheld
We understood that the savings claim in ad (b) was based on consumers purchasing the product at the “Deal Price” of £559 as Prime members, otherwise they would have to pay the higher price quoted in the ad.
The ad quoted the higher price as “Price: £752.00” and “Regular Price £752.00”. We considered consumers would interpret this to mean that Amazon’s usual selling price for the product was £752.
We referred to the pricing history Amazon provided, which covered a period of six weeks prior to the Prime offer shown in ad (b). We noted that in the six-week build up to the advertised offer, the product was initially sold at the same higher price for nine days, then at a lower price for 14 days, then again at the higher price for two days, and after that, at a lower price for 16 days. We considered that such price fluctuations, which showed that the product was sold at a cheaper price for the majority of time for six weeks prior to the Prime offer, along with the short period of time the pricing history covered, did not demonstrate that Amazon usually sold the product at the higher price of £752.00.
Therefore, because Amazon did not provide adequate evidence to support the savings claim in ad (b), we concluded that it had not been substantiated and was misleading.
On this point ad (b) 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).
3. Upheld
Regarding ad (c), we referred to the spreadsheet Amazon provided, which we understood to show that on 8 and 15 July 2017 three Amazon Marketplace sellers had offered the same product at prices slightly above the RRP quoted in the ad (£999). We considered that given the product was being offered to consumers on the Amazon Marketplace, it was reasonable to expect that Amazon could provide data showing that the product was sold by the three Marketplace sellers at the higher prices and in sufficient quantities to support the RRP claim. However, we noted that Amazon stated that in July 2017 (up to the date the ad was seen – 24 July), no sales of the product had been made on Amazon and that it was not available on Amazon in April, May and June 2017. Because of that, we considered that the data Amazon provided to support the RRP claim in ad (c) was not sufficient to demonstrate that the product was generally sold at that price across the market.
Therefore, because Amazon did not provide adequate evidence to support the savings claim in ad (c), we concluded that it had not been substantiated and was misleading.
On this point ad (c) breached CAP Code (Edition 12) rules 3.1 3.1 Marketing communications must not materially mislead or be likely to do so. (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 3.40 3.40 Price comparisons must not mislead by falsely claiming a price advantage. Comparisons with a recommended retail prices (RRPs) are likely to mislead if the RRP differs significantly from the price at which the product or service is generally sold. (Price comparisons).
4. Upheld
Regarding ad (d), we understood that the data showed that two major retailers had marketed the product at the quoted RRP of £270. One retailer offered the product at the RRP from 1 to 11 July 2017, whilst the other had offered it at the same RRP from 19 to 22 July 2017. Furthermore, a seller on the Amazon Marketplace marketed the product slightly above the quoted RRP at £284.54 on 22 July 2017, the date the complainant had seen the ad. However, we noted that the data also showed that three other major retailers had offered the same product at lower prices in July 2017. Because of that, we considered that the data Amazon provided to support the RRP claim in ad (d) was not sufficient to demonstrate that the product was generally sold at that price across the market.
Therefore, because Amazon did not provide adequate evidence to support the savings claim in ad (d), we concluded that it had not been substantiated and was misleading.
On this point ad (d) breached CAP Code (Edition 12) rules 3.1 3.1 Marketing communications must not materially mislead or be likely to do so. (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 3.40 3.40 Price comparisons must not mislead by falsely claiming a price advantage. Comparisons with a recommended retail prices (RRPs) are likely to mislead if the RRP differs significantly from the price at which the product or service is generally sold. (Price comparisons).
Action
The ads must not appear again in their current form. We told Amazon to ensure that future references to RRPs reflected the price at which the products concerned were generally sold, and to ensure that they held adequate evidence to substantiate their savings claims.
