Background
Update to Advertising Codes (7 April 2025):
On 7 April 2025, the Advertising Codes were updated to reflect the revocation and restatement of the Consumer Protection from Unfair Trading Regulations 2008 (“CPRs” – the legislation from which the majority of the CAP and BCAP rules on misleading advertising derived) by the Unfair Commercial Practices provisions in the Digital Markets, Competition and Consumers Act 2024 (“DMCCA”). On that date, the wording of a number of the rules in the Advertising Codes was changed to reflect relevant changes introduced by the DMCCA on 6 April 2025.
Given that the complaint that formed the subject of this ruling were received before 7 April 2025, the ASA considered the ads and complaint under the wording of the rules that existed prior to 7 April 2025, and the Ruling (and references to rules within it) should therefore be read in line with this wording, available here – CAP Code and BCAP Code.
Summary of Council decision:
Two issues were investigated, one was Upheld and the second was Upheld in part.
Ad description
Two paid-for social media ads, two website landing pages, a radio ad, a billboard and an email, for Octopus Energy:
a. The sponsored Facebook ad, seen on 23 October 2024, stated, “Most homes would save with Octopus”. The caption stated “Octopus customers pay less and always below price-cap prices”. A box at the bottom of the ad stated “Learn More”.
b. The landing page on the mobile website https://octopus.energy/value/, seen on 23 October 2024, stated “Most homes would save with Octopus”. Further text stated “We’re on a mission to make green energy cheap. Most homes in Britain are paying for energy at the price cap rate. Octopus is the only large supplier to price meaningfully below the Ofgem Energy Price Cap, and we’ve done so since the cap was launched. If you’re paying price cap rates with any supplier for your gas, your electricity, or both – you’ll save money if you switch to Octopus”. Further text included “The numbers behind the savings” and went on to detail the number of UK customers for Octopus compared to other suppliers, along with customer numbers for Octopus tariffs and a typical dual fuel quote. Text stated “This means 71% of homes would pay less on their annual bill if they switched to Octopus Energy”.
c. The sponsored Instagram ad, seen on 28 November 2024, stated “Most homes could save with Octopus”. Text at the bottom of the ad stated “Learn More”.
d. The landing page on the website https://octopus.energy, seen on 28 November 2024, stated “Great value for the long term, not just for the fixed term”. Further text above a box marked “Get a quote” stated “Enter your postcode to get a quote [,,,]”.
e. The radio ad, heard in October 2024, stated “Most homes would save with Octopus […] Visit octopus.energy/value for our calculation”.
f. The billboard, seen in September 2024, stated “Most homes would save with Octopus”. Smaller text stated “Visit octo.ps/value for our calculation”.
g. The email, received on 7 October 2024, stated “We’ve been notified by another supplier that you’ll be switching to them […] Will they really save you money? We’re generally the cheapest or near enough: in fact, 9 out of 10 Octopus customers pay less than they could with any other large supplier on the same product”.
Issue
British Gas Trading Ltd (BGTL), who believed that only consumers currently on a standard variable tariff (SVT) with another supplier would save money, challenged whether:
- the savings claims were misleading; and
- the ads adequately signposted consumers to verification information.
Response
1. Octopus Energy Ltd (Octopus) said the ads were intended to highlight the potential savings that a significant majority of consumers currently on standard tariffs could achieve. They did not claim that Octopus were the cheapest supplier in every scenario or for every tariff type. They added that they would be willing to make changes to their advertising.
Octopus referred to data from Office of Gas and Electricity Markets (Ofgem) and from the industry body Energy Networks Association (ENA). Of the 29 million electricity and 22 million gas customers in Britain, Octopus supplied 6.8 million and 5.8 million respectively. Most non-Octopus customers (71% of remaining electricity customers and 80% of gas) were on their supplier’s default SVT. Of the SVTs offered, they believed theirs was the cheapest, and that therefore those customers could save money by switching to Octopus. Octopus believed those figures were consistent with the claim “most homes could save”. They explained that their ads made explicit reference to “most homes” and not “all homes” to ensure that there was no suggestion that the claims applied universally or that Octopus was the cheapest supplier across all tariff types. They pointed out that the fact that a customer might save by switching to a non-Octopus tariff, should a competitor offer a cheaper fixed price tariff, did not detract from the fact that they could also save by switching to Octopus.
Octopus supplied Ofgem data in support of their claim that they offered the cheapest SVT and to show the number of Octopus customers on an SVT. Octopus said they had consistently offered the cheapest SVT of all major suppliers since at least January 2019, when the SVT price cap had been introduced. They added that they also offered competitive fixed tariffs, with a typical dual-fuel fixed tariff priced at £1,611 per year (as of June 2024); this was lower than the SVT rate of other major suppliers, meaning that customers on another supplier’s SVT would see a saving if they switched to Octopus’ fixed or SVT tariff.
With reference to ad (g) Octopus said the claim “9 out of 10 Octopus Customers Pay Less” appeared between April and October 2024 and was no longer being used. They said it was accurate at the time it appeared and was substantiated on the Octopus website.
With reference to ad (e) Radiocentre said they had accepted Octopus’ substantiation prior to clearing the ad.
2. Octopus said their ads signposted consumers to their website, where they would be able to review the methodology behind the savings claim. The basis for the comparison was summarised in detail on the landing page (ad (b)), which was linked to in every ad that used the claim. They believed the information relating to market analysis and competitor tariffs, as set out in point 1 above, was clearly referenced and accessible to consumers.
In answer to BGTL’s concern that customers were occasionally directed to web landing pages that did not contain any information about the savings claim, Octopus said they had reviewed their web advertising and had found only one example. This occurred in an ad (ad (c)) that was no longer running, that mistakenly directed consumers to the home page (ad (d)) rather than to the landing page with substantiation. They said they had corrected the link to ensure that it would not cause confusion if run again in the future.
With reference to ad (g) Octopus said the words “pay less” in the email should have contained a link to enable consumers to access the verification page. Due to an error, however, some versions of the email did not include the link. They said they would instigate extra checks on any similar future claims to ensure they included the appropriate links.
With reference to ad (e), Radiocentre said the ad included a link that clearly directed listeners to a place where they could access the evidence to verify the claim. Listeners would therefore be able to make their own assessment of the basis of the claim.
Assessment
1. Upheld
The CAP and BCAP Codes stated that marketing communications that included a price comparison must make the basis of the comparison clear. The Codes also stated that ads must state any significant qualifications.
The claim “Most homes would save with Octopus” appeared in the Facebook ad, the website landing page, the radio ad and the billboard. A further claim, “Most homes could save with Octopus”, appeared in the Instagram ad. The ASA considered that consumers would understand from the claims that energy bills would be cheaper for most households if they were to switch to Octopus from any other provider.
We understood that 80% of gas customers and 71% of electricity customers with other providers were on their supplier’s default SVT. We noted the Ofgem data from June 2024, based on average annual tariffs in the preceding quarter, showed that Octopus had the cheapest SVT of the seven major suppliers. We considered that those customers who switched from a non-Octopus SVT to an Octopus SVT were therefore likely to achieve a saving. Because those potential customers constituted the majority of UK households, we considered that most homes could or would potentially save money.
However, we understood that SVTs were the default tariff, but other options, such as fixed and tracker tariffs, were available to consumers and that those generally offered lower rates than SVTs. We therefore considered that consumers who were on a fixed tariff with another supplier might not necessarily save if they switched to Octopus. Conversely, consumers on an Octopus SVT seeking to move onto a fixed tariff might achieve a greater saving if they switched to a non-Octopus provider. Because the ads did not make clear that the claims that most homes “could” or “would” save applied only to consumers on non-Octopus SVTs who chose to switch to an Octopus SVT, we considered they were likely to mislead.
The claims “We’re generally the cheapest or near enough; in fact, 9 out of 10 Octopus customers pay less than they could with any other large supplier on the same product” appeared in ad (g), an email directed at Octopus customers who were switching to another supplier. We considered that consumers would understand that Octopus was generally cheaper than other suppliers’ equivalents across all of its products. The claims were based on the percentage of Octopus customers who were on the SVT, which was priced lower than other large suppliers’ equivalent tariffs at the time the ad appeared, but that was not made clear in the ad. We understood that other types of tariff, such as fixed rate tariffs, could be cheaper with another large supplier. Because the ad did not make clear the basis of the claim, we considered that it was misleading.
Ad (b) stated “Octopus is the only large supplier to price meaningfully below the Ofgem Energy Price Cap” and ad (a) stated “always below price cap prices”. We considered that consumers would understand from this that Octopus priced all its products below the capped rate. We understood that the claim related only to SVTs. While we acknowledged that the claim in ad (b) had since been amended to reflect that, we considered that in its original form the statement was likely to mislead.
For the reasons stated above, we concluded that the ads were misleading.
On that point, ads (a)–(d), (f) and (g) breached CAP Code (Edition 12) rules 3.1 (Misleading advertising), 3.9 (Qualification), 3.17 (Prices), 3.33, 3.34 and 3.35 (Comparisons with identifiable competitors) and 3.39 (Price comparisons).
On that point, ad (e) breached BCAP Code rules 3.1 (Misleading advertising), 3.10 (Qualification), 3.18 (Prices), 3.33, 3.34 and 3.35 (Comparisons with identifiable competitors) and 3.39 (Price comparisons).
2. Upheld in relation to ads (a) – (d) and (g) only
The CAP and BCAP Codes required that comparisons with identifiable competitors be verifiable. That meant that an ad which featured a comparison with an identifiable competitor or competitors needed to include, or direct consumers to, sufficient information to allow them to understand the comparison, and be able to check the claims were accurate.
For the reasons stated in point 1 above, we considered that the fact that the claims were based on a comparison with Octopus’ SVT alone was material information that should have been made clear in the main body of the ad. We were satisfied that the amended landing page (ad (b)) contained sufficient information to enable consumers to verify the claims. Notwithstanding those points, we assessed whether further information to enable consumers to understand the claims had been adequately signposted in the ads, which should indicate clearly where the verification information could be found.
The social media ads (a) and (c) featured a “Learn More” button that linked to a landing page (ad (b)), that detailed the basis of the claim. We acknowledged that ad (d), a website which contained no information about how consumers could verify the claim, had been linked to in error and that Octopus had taken steps to prevent that from happening again. Nevertheless, we considered that the text “Learn More”, which appeared at the bottom of the ads rather than in the main body, did not constitute an adequate and specific signpost.
The radio ad (e) stated “Visit octopus.energy/value for our calculation” and the billboard ad (f) stated “visit octo.ps/value for our calculation”. Both ads therefore signposted where consumers could find information about the comparison. We considered that ads (e) and (f) satisfied the requirements for verifiability.
Verification information for the claims in email ad (g) “Will they really save you money? We’re generally the cheapest or near enough: in fact, 9 out of 10 Octopus customers pay less than they could with any other large supplier on the same product” could be found on Octopus’ website. The web page stated that every other large supplier’s variable tariff was priced exactly at the cap, which was the maximum that they were permitted to charge. It stated that 90% of their customers were on Flexible Octopus, their variable tariff, which was cheaper than the January 2024 price cap. Those customers paid £1,913 a year for the average dual fuel home, compared to £1,928. However, the email did not contain a link to that page to enable consumers to verify the claims. We acknowledged that Octopus had taken steps to prevent that from happening again. Nevertheless, we considered that information to allow consumers to understand the claim was not signposted in the ad.
We considered that ads (a) – (d) and (g) did not include, or adequately direct consumers to, information to allow them to understand the comparisons made and therefore breached the Code.
On that point, ads (a) – (d) and (g) breached CAP Code (Edition 12) rule 3.35 (Comparisons with identifiable competitors. On that point, we investigated ad (e) under BCAP Code rule 3.35 (Comparisons with identifiable competitors) and ad (f) under CAP Code (Edition 12) rule 3.35 (Comparisons with identifiable competitors), but did not find them in breach.
Action
The ads must not appear again in their current form. We told Octopus Energy Ltd to ensure that they included adequate substantiation to support claims, including comparisons with identifiable competitors, in their marketing materials and to make the basis of any claim clear in their advertising. We also told them to ensure that any comparative claims were verifiable.
