Asda has had a complaint against it for misleading advertising upheld by the Advertising Standards Authority (ASA).
The complaint occurred after the retailer put the price of a product up substantially for just one day and then “cut” the price in a promotion that was more expensive than it had been prior to the price rise.
An online sales promotion in mid-July 2015, stated: “3 for £3 … Asda Choco Squares … £1.38 … 3 for £3.00”, but a complainant said the price of the product was increased from 97p per box prior to the promotion.
In its response to the ASA, Asda said its Choco Squares cereal was priced at 97p per box between January 2015 and 5 July 2015, and at £1.38 from 6 July 2015. On 7 July 2015 the product was then included in a mix and match multi-buy offer of three packs for £3.
Asda said the advert communicated the current selling price of £1.38 for an individual pack and that all other information was present in the ad in order for a customer to make an informed decision about whether or not to purchase the product. Furthermore, the advert did not make any implied comparison with the product’s past price.
It said a customer could choose to purchase one pack of Choco Squares product for £1.38,.
However, the ASA said it agreed with a Competition and Markets Authority’s (CMA) report that said if the price of an individual item is artificially inflated, this could mislead the consumer as to the genuine price of the product in question.
It noted Asda’s assertion that the advert clearly communicated the current selling price of an individual pack of Choco Squares as £1.38. However, it considered consumers were likely to understand that the individual pack price of £1.38 was both the current and the usual selling price, and that the promotional price of three for £3 therefore represented value for money when multiple items were purchased. It considered the promotion was likely to encourage consumers to purchase multiple packs of Choco Squares when previously they might have purchased only one, based on the advert’s suggestion that a genuine saving was available.
It added: “We understood the product had been priced at 97p for around six months up to 5 July and that it was changed to £1.38 on 6 July, which represented an increase of 42%. The product then became part of the multi-buy offer on 7 July, one day after the price was increased. We considered that the price of 97p was clearly the usual selling price at the time the multi-buy offer was introduced, rather than £1.38, as suggested by the advert.
“Because the ad suggested the usual selling price of their Choco Squares was £1.38, and implied a saving could be achieved against the usual selling price when that was not the case (indeed, when the multi-buy unit price was more expensive than the usual selling price), we concluded that it was misleading.”
The ASA ruled the advert was misleading and must not appear again in its current form. It told Asda to ensure its future promotions did not mislead about the savings consumers could achieve.