Background
Summary of Council decision:
Two issues were investigated, both of which were Upheld.
Ad description
A page on the website for Quidco, www.quidco.com, offered cashback to their members on purchases from a range of retailers, seen on 8 February 2021. The page, relating to a sporting goods retailer, had different versions for non-logged-in and logged-in website visitors:
a. The version of the web page displayed to non-logged-in website visitors featured the claim “Up to 8% cashback” in prominent bold green text on the left-hand side at the top of the page. A prominent heading “[Retailer] Cashback & Offers” appeared next to it. Two cashback offers were listed underneath: “8% cashback for all purchases of £100 or more” and “2% cashback for all purchases up to £99.99”. That was followed by the headings “More about [retailer]”, “[Retailer] discounts” and “Get [retailer] cashback”, underneath which text provided information about the retailer, the discounts it offered and how to get cashback on purchases at the retailer through Quidco.
b. The version of the web page displayed to logged-in Basic members also listed two cashback offers: “5.6% cashback for all purchases of £100 or more” and “1.4% cashback for all purchases up to £99.99”. The ad featured the same headings and text as described above. The web page also included two additional sections headed “What will stop me earning cashback?” and “Good to know” which provided more information about limitations to the cashback offers. This included, in the “Good to know” section, the text “The vast majority of merchants do not pay cashback on the full basket price, they pay cashback minus VAT, delivery charges, card payment fees, surcharges, taxes and any other additional charges, occasionally some may pay cashback on the full basket amount”.
Issue
The complainant, who understood that cashback was not paid on the VAT part of purchases made with the retailer, challenged whether:
1. ad (a) was misleading, because it did not make that sufficiently clear; and
2. ad (b) was misleading, for the same reason.
Response
1. & 2. Maple Syrup Media Ltd t/a Quidco said that, in general, retailers only paid cashback on the ‘core’ basket price, i.e. the total basket price minus VAT, delivery charges, card payment fees and other additional fees. There had been various instances when that was not the case, but Quidco did not have control of that, so they could not be sure in any given situation whether their members would receive cashback on the core basket price or the total basket price. The statement in the ‘Good to Know’ section of ad (b) was therefore factual.
They also explained that retailers calculated the eligibility of a purchase for a cashback offer based on different requirements; some calculated the eligibility based on the core basket price, and others on the total basket price. For example, to be eligible for 8% cashback on purchases over £100, some retailers would require the core basket price to be over £100 (thus requiring members to spend at least £120 to be eligible), whereas other retailers would only require the total basket price to be over £100.
Quidco said they understood the importance of communicating this information, and said they would review ways to increase its visibility in ad (b) relative to other important information on terms and conditions (such as exclusions from an offer).
With regard to ad (a), the non-logged-in version of the web page, they said that consumers might be confused about the situation if they referenced VAT on that page; they would review whether to include information in other sections of the website addressing the issue in detail.
They confirmed that the presentation of the information in ads (a) and (b) was replicated across their website on pages relating to other retailers.
Assessment
1. Upheld
Ad (a) was the non-logged-in version of the retailer web page. The ASA considered its audience was likely to include both Quidco members who were reviewing offers while not logged-in to the website and non-members who were considering whether to sign up, who were reviewing the pages of specific retailers from whom they were interested in making purchases.
We considered that both sets of visitors to the web page would understand from the claim “Up to 8% cashback” to mean that at least one cashback offer was available from the retailer which would enable all Quidco members to claim 8% cashback. The two offer listings provided additional context about the offers available: “8% cashback for all purchases of £100 or more” and “2% cashback for all purchases up to £99.99”. We considered all visitors to the web page would understand those claims to mean that all Quidco members would receive 2% cashback if they spent £99.99 or less at the retailer, and 8% if they spent £100 or more. We considered that all visitors to the web page would understand those offers to apply to the total basket price of any purchase from the retailer.
We understood, however, that the retailer (and many others that Quidco worked with) calculated the amount of cashback due to Quidco members based on the ‘core’ basket price (i.e. the total basket price minus VAT, delivery charges, card payment fees and other additional fees). It was therefore not possible for any Quidco member to receive the level of cashback they would expect based on their understanding of the ad. Additionally, in order to be eligible for the 8% cashback rate, members would have to spend at least £120 in order to take account of VAT and other charges and fees.
We considered consumers’ decisions about whether to become a Quidco member, whether to make a purchase with a specific retailer, and how much they would spend with that retailer, would be influenced by their understanding of the amount of cashback they would receive when making a purchase. Information about how cashback would be calculated, including whether it would be payable on the core basket price or the total basket price, and how much must be spent by the member in order to be eligible for a specific cashback rate, was therefore material information. Because consumers would understand the claims as relating to their spend with the retailer inclusive of VAT, rather than excluding it, we considered the primary claims about the cashback offers should have included wording that made clear that cashback amounts and rate eligibility were not based on the total basket price. We further considered the primary claims should also have been immediately and prominently qualified with information which clarified that cashback amounts and rate eligibility were calculated after excluding VAT, delivery charges and other specific fees from the total basket price. Ad (a) did not include any information to that effect, and we therefore concluded the ad was misleading to consumers on that basis.
We further understood that the 8% and 2% cashback offers from the retailer were only available to Quidco’s Premium members; the offers available to Basic members were for 5.6% and 1.4% respectively. (Premium members received additional benefits over Basic members, in return for Quidco retaining £1 of earned cashback in months in which the member claimed cashback). We considered that because consumers would understand that all Quidco members would be eligible for the offers listed on the web page, when only Premium members were eligible, the ad was also misleading on that basis.
In the absence of clarification within the primary claims “8% cashback for all purchases of £100 or more” and “2% cashback for all purchases up to £99.99” that cashback amounts and rate eligibility were not calculated on the total basket price, and a prominent and immediate qualification clarifying that cashback amounts and eligibility were calculated after excluding VAT, delivery charges and other specific fees from the total basket price, we concluded the ad was misleading as to the amount of cashback that would be received on purchases.
On that 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), 3.9 3.9 Marketing communications must state significant limitations and qualifications. Qualifications may clarify but must not contradict the claims that they qualify. (Qualification) and 3.17 3.17 Price statements must not mislead by omission, undue emphasis or distortion. They must relate to the product featured in the marketing communication. (Prices).
2. Upheld
Ad (b) was the logged-in version of the retailer web page displayed to Basic members. The topmost part of the web page was presented in the same way as ad (a), except that it referenced the rates of cashback available to Basic members specifically. As with ad (a), we considered that logged-in visitors to the web page would understand from those primary claims that the offers applied to the total basket price of any purchase from the retailer.
We acknowledged that the wording in the “Good to know” section of ad (b) accurately described the varying circumstances that the amount of cashback payable might be based on the core basket price or the total basket price. However, it did not communicate that eligibility for offers might also be calculated on either core basket price or total basket price. Furthermore, because of its generality and its positioning on the page it did not make clear the circumstances that applied to each specific offer available from the specific retailer to whom the web page related. We therefore considered it was not sufficient to make clear to members that they would receive cashback on only the core basket price, and that their eligibility for the 5.6% cashback rate would be based on the core basket price being £100.
We considered that in order to avoid misleading consumers, wording that made clear that cashback amounts and rate eligibility were not based on the total basket price should have been included in the primary claims “5.6% cashback for all purchases of £100 or more” and “1.4% cashback for all purchases up to £99.99”. Those claims should also have been immediately and prominently qualified with information which clarified that cashback amounts and rate eligibility were calculated after excluding VAT, delivery charges and other specific fees from the total basket price. In the absence of such clarification and qualification, we concluded the ad was misleading as to the amount of cashback that would be received on purchases.
On that 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),
3.9
3.9
Marketing communications must state significant limitations and qualifications. Qualifications may clarify but must not contradict the claims that they qualify.
and
3.10
3.10
Qualifications must be presented clearly.
CAP has published Advertising Guidance on Misleading advertising: use of qualifications.
(Qualification) and
3.17
3.17
Price statements must not mislead by omission, undue emphasis or distortion. They must relate to the product featured in the marketing communication.
(Prices).
Action
Ads (a) and (b) must not appear again in the form complained about. We told Maple Syrup Media Ltd t/a Quidco to ensure that references to the amounts which consumers needed to spend to take advantage of cashback offers did not mislead by implying that the rates related to their total spend, where they instead related to total spend minus VAT, delivery charges and other fees. Where the cashback amount and rate eligibility for cashback offers were based on the ‘core basket price’ rather than the total basket price, wording must be included in the primary claim about the offer that made clear that the amount and eligibility were not based on the total basket price. Those primary claims must also be immediately and prominently qualified with information which clarified that cashback amounts and rate eligibility were calculated after excluding VAT, delivery charges and other specific fees from the total basket price.
