Advertising Regulatory Board rules OneDayOnly breached practice code with false ’33% discount’ offer

30 Oct 2023

The retailer had mailed customers to alert them to a 33% discount on two Lego Advent calendars, but a savvy consumer took issue with the fact that their price was the same as that elsewhere.

With Black Friday weeks away – a period in which retailers have become renowned for temporarily hiking prices of goods and then discounting them just before sales day to give the appearance of a bargain – the Advertising Regulatory Board’s (ARB’s) directorate has ruled against an e-tailer for “discounting” an item that was never a discount and widely available at other retailers for the same price.

Consumer Brendan Sutcliffe complained to the advertising regulator that OneDayOnly had sent him an email alerting him to a 33% discount offered on Lego Advent Calendar sets bought through www.onedayonly.co.za.

When comparing this “33% discount” offer to other offers at the time, Sutcliffe suspected that the so-called discount was false advertising because he could have bought the same set at other retailers for the same price.

OneDayOnly, which does not submit to the ARB’s jurisdiction, explained that its sales team conducted comparative pricing research on all products, but conceded that, this time, the search and comparison was not exhaustive.

It said product pricing across various retailers vary daily, which means that comparative pricing may not be aligned to prevailing prices at the time, because other retailers may have adjusted their prices.

In terms of the Advent Calendar on offer, it said the supplier had provided the retail price of R700 on two product variations of the Lego 2023 Advent Calendars – Friends and City Exploration.

Before listing the product on its website, the sales team compared the prices of the same goods offered on Takealot (both R799): Lego Friends and Lego City Exploration.

It said that based on these retail prices, the team decided that its supplier’s R700 retail price was reasonable and sufficient to substantiate the claimed retail price and subsequent savings.

Ruling

In considering the matter, the directorate referred to its Code and clauses on misleading claims and price comparisons. Since OneDayOnly does not subscribe to the ARB, the regulator has no jurisdiction over the company, but can issue a ruling for the guidance of its members.

The complainant had featured five different Lego sets: Lego Friends Advent Calendar at R479; Lego City Advent Calendar at R479; Lego Star Wars Advent Calendar at R719; Lego Marvel Super-Heroes Avengers Advent Calendar at R669; and Lego Harry Potter Advent Calendar at R669.

The advertiser, on the other hand, made specific reference to two Lego sets - set number 41758 and set number 60381 - and said only these two sets claimed a saving of 33%. Given this, the directorate only considered those two sets.

Clause 4.2.1 of its Code requires advertisers to ensure that their advertising content contains sufficient clarity to allow customers to make an informed choice about the product or service on offer. It also states that advertising should not deceive by means of ambiguity, omission of material information or exaggeration.

Clause 5 sets out guidelines in terms of which advertisers should structure any advertising that compares its prices to those of competitors.

A central theme running through all these provisions is the requirement for advertisers to provide “satisfactory documentary evidence” of their claimed reductions or savings.

The OneDayOnly advertisement contained a highlighted box with the words ‘SAVE 33%’ above the image of a child playing with this set, which it said was an unambiguous and unlimited claim that customers who buy through the advertiser’s online store would save 33%, compared with other stores.

The complainant submitted that this was inaccurate, as he was able to find another retailer (www.greatyellowbrick.co.za – the official Lego seller in South Africa) selling the various Lego sets at the same price as the advertiser’s “discounted price”, thus contradicting the alleged saving of 33%.

The URLs provided by the advertiser appear to offer sets 41758 and 60381 at a price of R799, noting that these are “Parallel Import” items.

During its investigation, the directorate did an online search for the Lego sets, finding various prices at Toys R Us, Toy Kingdom, Loot, Takealot, etc.

The directorate said that the source cited by the complainant, being the Lego direct retailer, would have been a logical starting point for any price comparison.

“At the very least, the advertiser does not appear to have provided ‘satisfactory documentary evidence’ of its claimed saving as required by Clause 5 of Section 2 of the Code.

“Its unconditional and unlimited claim to offer an opportunity for customers to ‘SAVE 33%’ therefore appears to be unjustified and inaccurate in a manner that breaches both Clause 4.2.1 of Section 2 and Clause 5 of Section 2 of the Code.”

Members of the ARB are therefore advised that the advertiser’s claim of a 33% saving should not be accepted for publication unless and until it holds what would reasonably be regarded as satisfactory documentary evidence of the claimed saving and price reduction.

An analysis by consumer group Which? last year warned shoppers searching for Black Friday bargains that most deals do not offer genuine discounts.

Analysis of more than 200 offers last Black Friday in the UK found 98% were cheaper or the same price at other times in the year, Which? said.

With many consumers under pressure to make savings amid an escalation in the cost of living, Black Friday and Cyber Monday are the busiest dates in the retail calendar.

Last year, prices were seen to be rising at their fastest rate in over 40 years, but Which? warned that Black Friday was “rarely the cheapest time to shop”. DM

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