Background
Summary of Council decision:
Two issues were investigated, both of which were Upheld.
Ad description
A job vacancy listing for Vanguard Marketing, seen in December 2017 on www.totaljobs.com, stated "Sales Advisor. Immediate Start ... £250-£450 per week (average earnings) OTE ... Vanguard Marketing is looking for people with a passion for customer interaction and a desire for professional development. Vanguard Marketing is an ambitious company, with a view to expand their model throughout the UK in the coming months, so we're seeking enthusiastic candidates to help facilitate this growth and become the future of our organisation. We represent our client by increasing market share and we have recently acquired a new office in Middlesbrough. The demand for our service is growing and we are therefore looking to fill these roles asap. If you have any customer service, sales, marketing, retail or hospitality experience we would love to meet you ... Our Sales Openings involve: Sales and Customer Service, Customer Acquisition, Marketing and Promotions, Business Workshops, Strategy & Planning, Campaign Development".
Issue
1. The complainant, who understood that Vanguard Marketing Ltd was a door-to-door sales company and that earnings were commission only, challenged whether the ad was misleading because it did not make clear the nature of the position.
2. The complainant also challenged whether the quoted earnings claim of "£250-£450 per week (average earnings) OTE" was misleading and could be substantiated.
Response
1. Vanguard Marketing Ltd stated that the complainant’s understanding that the company was a door-to-door sales company and that earnings were based on commission only were correct. They said that they offered business opportunities for self-employed individuals and that the word “vacancy” was not included anywhere in the ad. They provided a copy of the Trading Agreement that all of their Independent Sales Advisors (ISAs) were required to sign before commencing trade.
Vanguard Marketing said that the scope of the ad provided further insight into the opportunities available on commencement to trade with their company. They said that ISAs had access to daily sales product-training workshops with the Managing Director and other experienced ISAs. They also had opportunities to attend regular business meetings set up by the contact supplier to learn about recruitment, campaign development and to network with other individuals working in a similar field.
Vanguard Marketing said that they advertised opportunities on several sites and had never had a complaint about an ad being unclear. They said that they did mention self-employment in their ads but must have been omitted from this one particular ad. They said they would add the word “self-employment” to all of their ads going forward.
2. Vanguard Marketing stated that the earnings figures quoted in the ad were representative for the average ISA who currently traded with their company, and not an average employee. They chose the option of OTE (on-target earnings) to accurately reflect the pay range in the first year. They said that since opening in June 2017, their longest-standing agent had been trading with them for seven consecutive weeks at one point in time. As the agents were self-employed, they chose their working hours, and the estimated weekly average that they advertised was based on the assumption that they worked the same hours as a person in full-time employment. Vanguard Marketing provided invoices relating to the earnings of two individual ISAs between December 2017 and January 2018.
Assessment
1. Upheld
The ad stated “Sales Advisor”, “we’re looking for people with a passion for customer interaction and a desire for professional development”, “we’re seeking enthusiastic candidates”, “the demand for our service is growing and we are therefore looking to fill these roles asap”, and made a number of statements about opportunities for development and experience in different business areas. We considered that readers of the ad were likely to understand that it referred to an offer of employment. While we acknowledged Vanguard Marketing’s willingness to add a reference to “self-employment”, we did not consider that this was sufficient, on its own, to counteract the impression likely to be given to readers that the ad was offering employment.
Furthermore, we considered that the term “Sales Advisor” and the references to experience in different business areas such as “Sales and Customer Service, Customer Acquisition, Marketing and Promotions, Business Workshops, Strategy & Planning, Campaign Development” were quite general and could be understood as applying to a number of different types of sales or marketing positions that varied in the nature of their duties and requirements. We understood that the opportunity being offered entailed door-to-door sales. We considered that this was material information that was likely to have an impact on readers’ decision to apply for the role – for example, implications about transport costs and other expenses. We noted that this aspect of the role was not mentioned anywhere in the ad.
Because the ad did not make sufficiently clear that it was promoting a business opportunity, and not an offer of employment, and because it omitted material information regarding the nature of the role offered, we concluded that the ad was misleading.
On that 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
20.1
20.1
Marketing communications must distinguish clearly between offers of employment and business opportunities. Before publication, media owners normally require marketers' full details and any terms and conditions imposed on respondents.
(Employment, homework schemes and business opportunities).
2. Upheld
The CAP Code stated that quoted earnings must be precise. It further stated that if income was earned from commission only, that must be made clear. The ad stated "£250-£450 per week (average earnings) OTE". We considered that not all consumers would be aware of what “OTE” meant. We considered that readers of the ad would understand the claim to mean that all advisors would earn between £250 and £450 per week. However, we understood that earnings were entirely commission based and there was no salary.
We considered the evidence provided by Vanguard Marketing for the earnings figures. We noted that they only referred to the earnings of two ISAs, one of whom had earned an average of £272.83 per week over six weeks, and the other who had earned an average of £338.13 per week over three weeks. We noted that their earnings from week to week varied greatly. In addition, we had not been provided with any information on the proportion of advisors who achieved earnings within the range stated. We understood from Vanguard Marketing that ISAs’ working hours varied, and they had estimated weekly average earnings based on the assumption that they worked the same hours as someone in full-time employment. However, it was unclear how they had calculated this average, or how a figure based on hourly earnings was relevant to a commissions-only income structure. Overall, we considered that we had not seen evidence that the figure of “£250-£450 per week” was representative of the earnings of the average sales advisor, regardless of whether the ad made clear how that income was earned.
Because the ad did not make sufficiently clear that earnings were entirely commission based and that there was no salary, and because we had not seen adequate evidence that the quoted figures were representative of the average earnings of a Vanguard Marketing Sales Advisor, we concluded that the ad was misleading.
On that 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)
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
20.2
20.2
Employment marketing communications must relate to genuine vacancies and potential employees must not be asked to pay for information.
Living and working conditions must not be misrepresented. Quoted earnings must be precise; if one has to be made, a forecast must not be unrepresentative. If income is earned from a basic salary and commission, commission only or in some other way, that must be made clear.
(Employment, homework schemes and business opportunities).
Action
The ad must not appear again in the form complained about. We told Vanguard Marketing Ltd not to misleadingly present the nature of the role offered, including by implying that it was an offer of employment rather than a business opportunity, and by not making clear that it involved door-to-door sales. We also told them to ensure they held adequate substantiation for quoted earnings figures, and to make clear if earnings were based on commission only.
