Ebay gets knuckles rapped over pricing

An advertisement by Ebay has drawn the ire of the UK Advertising Standards Authority (ASA).

Ebay issued a poster claiming that prices on its site were 25 percent cheaper than the High Street for brand new items. High Streets in Britain are the main shopping areas in a town or city.

The firm said the source of the complaint was an organization called Frontier Economics, obtained by comparing the average sold price, including postage and packing of 288 new products.

But a complaint was received saying the claim would mislead buyers, because Ebay hadn't made sufficiently clear the basis of such a comparison. Ebay's response was that the independent survey looked at typical household items sold both on its site and in mainstream stores. Unbranded products and second hand and used items were excluded from the study.

But the ASA upheld the claim on the basis that the phrase "25% cheaper than the High Street on brand new items" was an absolute claim that Ebay was cheaper than all main high street stores for all new items. The full evidence, however, wasn't available, the ASA noted. Plus, there were product sectors not included that should have been, such as furniture, garden goods, computers, and toys and games. Ebay had not made that clear.

The ad breached the advertising code on three counts - substantiation, truthfulness and comparisons with identified competitors and/or their products.

Thundered the ASA: "The ad must not appear again in its current form. We told Ebay to ensure they held robust evidence to support comparative claims in future."