Following unexpectedly high redemption rates fuelled by alleged tactical purchases, Tesco quickly introduced a £20 limit on its March 2011 promise to refund double the difference if products were found cheaper in Asda than in Tesco. But following 15 complaints the ASA considered whether the retailer properly flagged up the new limit. Hannah Willson reports.
Topic: Prices
Who: Tesco and the Advertising Standards Authority
Where: UK
When: 16 November 2011
Law stated as at: 1 December 2011
What happened:
"We'll refund double the difference if your shopping is cheaper at Asda" was the promise made by Tesco in a nationwide campaign launched in Spring 2011.
Tesco used TV, website and leaflet advertising to advertise their Price Check promotion starting in March 2011, but allegedly due to 'tactical shoppers' exploiting the promotion Tesco soon change the terms and conditions, to ensure the viability of the promotion, and imposed a fair use policy of a £20 cap for any voucher request.
The new limit was not mentioned in the advertising itself, but was inserted into terms and conditions and /or FAQs which all the advertising referred to as available at a given web address.
This introduction of a fair use policy gave rise to 15 complaints that the advertising wase misleading for not making it clear that the maximum value for an individual Price Check voucher was limited to £20. The complainants also thought that the fair use policy found in an FAQ section on the Price Check website contradicted the claim on the front page.
Tesco provided a full response to the Advertising Standards Authority ("ASA"), including supporting evidence on the uptake of the offer. The initial evidence provided by Tesco was from a period starting in July 2011, but since most of the complaints were received in March, on further request by the ASA Tesco provided evidence on the uptake of the offer from the beginning of the promotion in March.
Tesco considered that the uptake of the offer above £20 was so minimal that it did not constitute a significant restriction and that the claims above £20 dramatically reduced when the limit was imposed, which demonstrated that the positioning of the limit in the promotion terms and conditions rather than in the ads themselves was effective.
Refund claim data scrutinised
Having considered the evidence, however, the ASA found that between the launch of the promotion until the imposition of the £20 limit on 29 April, 8.5% of Price Check refund applications exceeded £20. This did not necessarily seem "minimal."
Also, the evidence showed that although there was a sharp drop in refund claims over £20 immediately after the new £20 limit was announced, the number of requests exceeding the limit started to rise again shortly afterwards and soon returned to pre-limit levels.
In these circumstances the ASA considered that inserting the £20 limit in the terms and conditions rather than in the ads themselves had not made it sufficiently clear that there was a limit.
The ASA also felt that the £20 limit was a significant restriction likely to affect shoppers' decisions to shop at Tesco during the promotional period and that its exclusion from promotion ads was therefore misleading. The regulator also agreed with the complaint that the £20 limit in the terms and conditions contradicted the headline refund promise in the advertising.
Taking into account all the evidence and supporting arguments presented by Tesco, the ASA considered that the advertising breached BCAP Code Rules 3.1 and 3.2 (misleading advertising) and 3.10 (qualification) and the CAP Code (Edition 12) Rules 3.1 and 3.3 (advertising must not mislead including by omitting material information) and 3.10 (qualifications must be presented clearly).
Why this matters:
It is always easy of course to be wise after the event, but this verdict underlines the importance of anticipating all possible ways in which a substantial nationwide promotion like this might play out.
Also, if a decision to change a promotion term part way through the promotion period is made, three important questions to consider are:
1. how material is the change? Does it amount to a material qualification of the offer?
2. taking into account the change, are the current advertising materials misleading?
3. how can the change best be brought to the notice of the consumer to avoid disappointment?
