Complaint: 06/197

Vodafone New Zealand Website Television & Outdoor Advertisements

Details

Document

DECISION


Meeting 8 August 2006

Complaint 06/197

Complainant: R. Malcolm-Smith

Advertisement: Vodafone New Zealand


Complaint:

Billboard and bus advertisements included:


"TXT from 1c

to Vodafone mobiles for $9.95 on You Choose Plans

make the most of now vodafone
12 MONTH TERM PLANS START FROM $19.95. VODAFONE TERMS & CONDITIONS APPLY - SEE VODAFONE.CO.NZ OR CALL 474 FOR DETAILS"

"15c CALLING

calls from 15c per minute
nights & weekends for $14.95
on Vodafone You Choose plans


make the most of now vodafone
12 MONTH TERM PLANS START FROM $19.95. VODAFONE TERMS & CONDITIONS APPLY - SEE VODAFONE.CO.NZ OR CALL 474 FOR DETAILS"

The television advertisement offered the opportunity to text for lc. The headline said: "Txt from 1c to Vodafone mobiles for $9.95 on You Choose Plans", and terms and conditions were printed onscreen, including the line: "Term Plans start from $19.95. See http://www.vodafone.co.nz or call 474 for details."


The conditions for You Choose on the website http://www.vodafone.co.nz included:

"How does You Choose TM work?


You Choose TM is simple. You start with a base plan that covers your standard voice calls. Then you plug in optional Add-Ons for awesome value deals on other Vodafone services.


First, pick your You Choose TM base plan


At the heart of every You Choose TM plan is your base plan, with included minutes for calling any number in New Zealand (except 0900 numbers and the like), any time of day or night. You can choose a plan with as little as 20 minutes per month, or as many as 1,100. These minutes are included in your monthly access fee, so if you don't exceed them, you don't pay anything more each month. ...

Then go shopping for some great value Add-Ons


Once your You Choose TM plan is in place, you can browse our range of Add-Ons, with great deals on other Vodafone services and calling types. These Add-Ons include packages of TXTs, special low rate nights and weekend minutes, international calling minutes and even video calling minutes.

You can browse and buy your Add-Ons right here online."


Complainant, R. Malcolm-Smith, said:

"What: Vodafone mobiles
Where: Back of buses, billboards, internet, everywhere
When: Week leading up to 31 may 2006
Description: lc texts - http://vodafone.co.nz/images/home/banh_lcent_txt.gif

15c/min phonecalls

http://vodafone.co.nz/images/promos/top.gif

There is an advert on TV showing buses carrying the advertisement and it is also on the back of busses all over Auckland.

Complaint -
These adverts do not include the cost of the base you choose plan, or make it clear that the price is a best case, and that you cannot purchase any number of texts for the 1 c price, if you exceed the 1000 texts then you are once again paying the regular rate, and there is a similar arbitrary number of 100 mins for the calling plan.

The advertising is misleading as the headline rate of 15c per min, or 1 c per text has so many conditions imposed on it that it will be virtually impossible for anyone to achieve the value that they have implied with that headline rate.

Due to the limit of 1 addon of each type that vodafone have inplace, someone that requires substantially more then 1000 texts will be unable to achieve anywhere near there headline rate, as all the additional texts will be at the normal 20c rate."


The Chairman ruled that the following provision of the Code of Ethics was relevant:

Rule 2: Truthful Presentation - Advertisements should not contain any statement or visual presentation or create an overall impression which directly or by implication, omission, ambiguity or exaggerated claim is misleading or deceptive, is likely to deceive or mislead the consumer, makes false and misleading representation, abuses the trust of the consumer or exploits his/her lack of experience or knowledge. (Obvious hyperbole, identifiable as such, is not considered to be misleading).


The Advertiser, Vodafone New Zealand, said:

"

  1. We write in response to the above complaint which you provided to us under cover of your letter of 14 July 2006. This response is on behalf of Vodafone, Lowe Worldwide & Adshel. The complaint alleges that Vodafone's 15c call and lc text offers are misleading. We note that the quality of the photographs accompanying the complaint are of poor quality and it is only in the final shot of the bus at Downtown on which the text of the advert is fully visible - and then it is barely legible. Although the photographs are of poor quality, we assume that the complainant was able to read the text of the adverts. To assist the Board, we enclose copies of the two adverts complained of.

  1. Vodafone does not accept that there is any substance to the complaint and it simply appears that the complainant is disappointed that the terms of the offers do not meet his needs or that he considers that the existence of any terms to which the offers are subject is misleading even though the adverts make it clear that terms apply. As we understand it, there are three key elements to the complaint that our adverts are misleading (Mr Malcolm-Smith's email dated 31 May 2006):

  1. the "adverts do not include the cost of the base You Choose plan";

  1. the adverts do not "make it clear that the price is a best case" and

  1. there are conditions on the offers which the complainant does not approve of (such as the limit on the number of calls or texts).

  1. Although we do not consider that the adverts are misleading, we deal with each of the elements of the complaints to ensure that the Board understands Vodafone's position.


Cost of the base You Choose plan

  1. It is difficult to understand this element as the ads do specify that the You

Choose plans begin at $19.95 per month. We assume that the complainant's issue is that not all plan prices are specified. Vodafone has introduced the You Choose plans to enable customers to select the plan which suits them best. As there are a range of six You Choose plans available, the price for any base plan is dependent on the customer's choice. (The second page of the print out from our website, which was included with the complaint, details the many options available.) For this reason, it was not possible to specify each base plan price in the adverts. Instead we listed the price of the most basic plan but made it clear that the offers (1c texting and 15c calling) were available on You Choose plans. Interested customers who were not already familiar with the You Choose plans could then explore for themselves which You Choose plan, if any, was suitable for them.

"Best case" price

  1. The complainant is correct that the 15c calls and 1 c texts are a "best case" price. However, this is apparent from the words of each ad where the word "from" is clearly visible immediately before the "1 c" and the "15c". It is clear from the ordinary meaning of the phrases "from lc" and "from 15c" that these are the lowest prices.


Conditions of the offers

  1. The heading and subheading of the adverts indicate that terms and conditions apply to the offers - the use of "from" and the fact that the offers apply to You Choose plans make it apparent to any reasonable reader. In addition, each advert states that "VODAFONE TERMS AND CONDITIONS APPLY - SEE VODAFONE.CO.NZ OR CALL 474 FOR DETAILS". The extract from the Vodafone website sets out the terms and conditions which apply to the offers and it appears that the complainant had no problems locating the terms. We can only surmise as to the actual issue but have presumed that it is that the offers are subject to terms at all.

  1. Vodafone's You Choose plans are about enabling customers to have flexible benefits (Add-Ons) which they select, remove and/or replace as they choose. Customers choose the base plan which suits them best and then add any additional services they wish. The adverts and the offers are targeted at You Choose customers (and possible future You Choose customers) and are not otherwise available to Vodafone customers. However, there is nothing misleading about that, the text is clear that the offers are available for You Choose plans, not generally and that terms apply. Those terms are available from the Vodafone website or through our free information line.

  1. While it is unfortunate that the terms of the offers did not suit the complainant it is clear from his complaint that he was neither misled or confused by the advertising. He was aware that terms applied to the offers, it simply appears that he did not like the terms or they did not suit him.

  1. We should also add that prior to receiving the notice of the complaint we became aware that the smaller text on the adverts was not as visible as we had intended because the colour of the text was lighter than it had appeared in the proofs we had seen and approved. On its own initiative Vodafone arranged for the printing of stickers in darker text which are in the process of being produced and will be applied over the existing grey text so that the text is clearer. We enclose a copy of the advert that is continuing through for the next few months, as it will appear with the darker text added. We expect that the change will be made within the next few days.

  1. We trust that this addresses any questions the Board may have but are, of course, happy to answer any questions or provide any further information which the Board may find helpful."




Television Commercial Approvals Bureau (TVCAB) said on behalf of the media:

"This Vodafone commercial offers the opportunity to text for lc. Along with the headline "Txt from 1c to Vodafone mobiles for $9.95 on You Choose Plans", the standard terms are outlined in the base line key with "Term Plans start from $19.95. See http://www.vodafone.co.nz or call 474 for details.

TVCAB accepted the accuracy of the information in this commercial in good faith. Any interpretations of this advertisement are open to challenge so we await with interest, the outcome of this complaint."


Deliberation

The Complaints Board perused the relevant correspondence and advertisements which included website, television, billboard and bus advertisements. It noted Complainant, R. Malcom-Smith, was of the view that the offers in relation to Vodafone's 15c call and 1c texts were misleading, as the conditions were not legible.

The Chairman directed the Complaints Board to consider the advertisement with reference to Rule 2 of the Code of Ethics.

Accordingly, the task before the Complaints Board was to determine whether the advertisements contained any statement or visual presentation or created an overall impression which directly or by implication, omission or exaggerated claim was likely to mislead the consumer, or exploit the lack of knowledge of the consumer.


The Complainant raised particular concerns including:

  • the "adverts do not include the cost of the base You Choose plan";

  • the adverts do not "make it clear that the price is a best case" and

  • there are conditions on the offers which the complainant does not approve of (such as the limit on the number of calls or texts).


In considering the complaint, the majority of the Board observed that all advertisements made it clear that the costs of calls or texts were "from 1c" or "from 15c" and agreed that this indicated that those prices indicated a 'best case'. It also noted that the base cost of plans were also shown clearly in the advertisements as "from $19.95 for a 12 month plan".

It also acknowledged that the Advertiser had taken action to make the smaller print on some advertisements more visible. The Advertiser advised "We should also add that prior to receiving the notice of the complaint we became aware that the smaller text on the adverts was not as visible as we had intended because the colour of the text was lighter than it had appeared in the proofs we had seen and approved. On its own initiative Vodafone arranged for the printing of stickers in darker text which are in the process of being produced and will be applied over the existing grey text so that the text is clearer."


However, a minority of the Board agreed with the Complainant and did not believe that the advertisement was clear in relation to the number of terms and conditions that applied to the offer. The minority of the Board did not consider that each advertisement met the test of being able to 'stand alone' in providing key details required by the consumer about the deals available in the Vodafone promotion.

The majority of the Board considered that this test had been met and that the basic price details of the offer were clear in relation to the "You Choose" promotion that provided consumers with flexible add-ons options for mobile phone plans. The majority of the Complaints Board agreed that the advertisements were not likely to mislead or deceive consumers and were therefore not in breach of Rule 2 of the Code of Ethics.

In accordance with the majority view, the Complaints Board ruled to not uphold the complaint.


Decision: Complaint Not Upheld