Background
Summary of Council decision:
Three issues were investigated, all of which were Upheld
Ad description
Three Instagram posts by @clearpay_uk, a ‘buy now pay later’ (BNPL) provider:
a. The first Instagram post, posted 5 October 2021, featured a meme showing two images of the character Seong Gi-hun from the TV show Squid Game. In the first image he was smiling, with text above that stated “Sticking to my monthly budget”. In the second image he looked stunned, and text above stated “ASOS offering 20% off site wide”. Text at the bottom of the image stated “T&Cs apply clearpay.co.uk/terms”. The post stated “*turns off push notifications* T&Cs apply http://clearpay.co.uk/terms #clearpay #LiveClear #Shopping #PayOverTime #PayBetter #PayIn4”.
b. The second Instagram post, posted 27 October 2021, featured a version of the ‘Tell me without telling me’ meme which included an image of multiple ASOS parcels with text above that stated “Tell me you love Clearpay without telling me you love Clearpay”. Text at the bottom of the image stated “T&Cs apply clearpay.co.uk/terms”. The post stated “Tag a friend who has a Clearpay addiction [eye emoji] Remember to spend responsibly and return some of those! T&Cs apply clearpay.co.uk/terms #clearpay #Shopping #PayOverTime #PayBetter #PayIn4 #ASOS”.
c. The third Instagram post, posted 20 January 2022, featured an image of a pie chart titled “Why I need new clothes”. The majority of the pie chart corresponded with the key that stated “[insert brand here] is having a 40% off sale” and a small section of the pie chart corresponded with the key that stated “I need jumpers for winter”. The post included the caption “Why am I like this [woman raising hand emoji] #clearpay #shopping”.
Issue
The ASA challenged whether ads:
1. (a); 2. (b); and 3. (c) were irresponsible, because they encouraged people to spend more than they could afford.
Response
1., 2. & 3. Clearpay Finance Ltd (Clearpay) said that their ‘buy now pay later’ (BNPL) service allowed consumers to receive products immediately and pay for their purchases in four interest-free instalments over a six-week period. Their service was free for consumers who paid on time, and helped people to spend responsibly without incurring interest, fees or extended debt. Their credit agreements were exempt from regulation under the Consumer Credit Act 1974 and were outside the Financial Conduct Authority’s (FCA) consumer credit regime.
They said that they did not use phrases that risked consumer confusion or encouraged irresponsible or carefree spending behaviour. The intention of the posts was to highlight behaviours that could potentially lead to irresponsible lending and then deliver a message that aimed to educate their followers on the importance of responsible spending.
Ad (a) identified making a non-essential purchase because an item was on sale as potentially detrimental behaviour. It explained that failing to stick to a monthly budget was the potential pitfall of the behaviour, and then suggested to turn off marketing push notifications as a strategy for avoiding this behaviour. The post delivered a core message highlighting the importance of responsible spending.Ads (a) and (b) included a URL that linked to Clearpay’s terms page that said that Clearpay was a form of credit and that late fees applied.
In relation to ad (b), they said a central use of their BNPL service was to purchase multiple items in different styles and sizes in one order, with the intention of returning most of the order. Thus consumers could avoid having to save-up to purchase clothing up-front that they did not intend to keep. They believed this was socially responsible because it highlighted the additional thought that consumers put into the purchase decision. The ad included a warning to return items and shop responsibly, which they believed emphasised the importance of responsible spending.
They said ad (c) was not an ad for their BNPL service, as the service was not mentioned and it did not include any call to action for consumers to consider using Clearpay. However, if the post was considered to be an ad in the ASA’s remit, they believed that it had been prepared with a sense of responsibility and, in fact, aimed to educate their followers on the importance of responsible spending by making them question whether they really needed to purchase the sale item.
They said that ads (a), (b) and (c) would have been viewed by consumers who followed Clearpay on Instagram and were likely familiar with their BNPL service and the responsibilities associated with it. None of the ads focused on the speed or ease of accessing Clearpay.
They said they used memes to deliver the responsible spending messages in the ads in a form that they believed was the most effective in engaging with their ‘younger adult’ audience.
Assessment
The ASA understood that Clearpay operated a delayed payment service whereby consumers could purchase items from a selection of retailers and pay for them in four equal payments over six weeks. No interest or fees were payable to consumers who made their repayments on-time. If a payment was missed, then a late fee applied. We understood that the service was not a loan or credit card facility, and was exempt from the Consumer Credit Act 1974 and associated regulations.
1. Upheld
The ad included a meme showing two images of the character Seong Gi-hun from the TV show Squid Game. In the first image he was smiling, with text above that stated “Sticking to my monthly budget” and in the second image he looked stunned, and text above stated “ASOS offering 20% off site wide”. The ad included the caption, “*turns off push notifications*”. Text at the bottom of the image and in the caption, including the hashtags, referenced Clearpay. We considered that consumers would understand the ad as making light of consumers who were unable to exercise self-control over their spending when a sale at a particular retailer was on. We further considered that consumers would understand the scenario depicted in the ad was linked to the use of Clearpay.
By making light of not sticking to a monthly budget, we considered the ad encouraged consumers to use a form of credit with delayed payment to pay for non-essential purchases in situations where they did not have the budget to do so. Because the ad encouraged people to spend more than they could afford, we concluded that it was socially irresponsible.
On that point, ad (a) breached CAP Code (Edition 12) rule 1.3 1.3 Marketing communications must be prepared with a sense of responsibility to consumers and to society. (Social responsibility).
2. Upheld
The ad included an image of multiple ASOS parcels with text above that stated “Tell me you love Clearpay without telling me you love Clearpay”, and included the caption “Tag a friend who has a Clearpay addiction Remember to spend responsibly and return some of those!”. Text at the bottom of the image and in the caption, including the hashtags, referenced Clearpay. We considered that consumers would understand the ad as making light of consumers who were unable to exercise self-control in making purchasing decisions and in particular when using Clearpay.
By making light of not having self-control when shopping, we considered the ad encouraged consumers to use a form of credit with delayed payment to pay for non-essential items when they could not necessarily afford them. We noted the caption in the ad reminded consumers to spend responsibly and to return some of their purchases. We considered that whilst some consumers may return all or part of their purchase, not all would. We therefore considered the statement did not significantly alter the core message of the ad. Because the ad encouraged people to spend more than they could afford, we concluded that it was socially irresponsible.
On that point, ad (b) breached CAP Code (Edition 12) rule 1.3 1.3 Marketing communications must be prepared with a sense of responsibility to consumers and to society. (Social responsibility).
3. Upheld
The ASA noted Clearpay’s submission that the post did not fall within the remit of the CAP Code. We noted that the post appeared on Clearpay’s Instagram page - a non-paid-for space, which was under the advertiser’s control. We considered the post encouraged consumers to buy clothes using Clearpay’s service. Because the post was directly connected with the supply of Clearpay’s service, we considered that it was a marketing communication within the remit of the CAP Code.
The ad included an image of a pie chart titled “Why I need new clothes”. The majority of the pie chart corresponded with the key that stated “[insert brand here] is having a 40% off sale” and a small section of the pie chart corresponded with the key that stated “I need jumpers for winter. The post included the caption “Why am I like this” and the hashtag “#clearpay”. We considered that consumers would understand the ad as making light of consumers who were unable to exercise self-control over their spending when a sale at a particular retailer was on. We further considered that consumers would understand the scenario depicted in the ad was linked to the use of Clearpay.
By making light of not having self-control when shopping, we considered the ad encouraged consumers to use a form of credit with delayed payment to pay for non-essential purchases because they were on a promotion when they could not necessarily afford them. Because the ad encouraged people to spend more than they could afford, we concluded that it was socially irresponsible.
On that point, ad (c) breached CAP Code (Edition 12) rule 1.3 1.3 Marketing communications must be prepared with a sense of responsibility to consumers and to society. (Social responsibility).
Action
The ads must not appear again in the form complained of. We told Clearpay Finance Ltd to ensure that their ads did not encourage people to spend more than they could afford.
