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COMPLAINT NUMBER 13/530 COMPLAINANT D. Platt ADVERTISER Leaders Newspaper ADVERTISEMENT Leaders Real Estate 1987 Limited DATE OF MEETING 29 January 2014 OUTCOME Upheld SUMMARY The newspaper advertisement for Leaders Real Estate compared the rateable value (RV), with the “SOLD” price of 79 houses in the Wellington region and provided the percentage sold above RV. The advertisement stated, in part “Who sells Wellington for the best prices? WE DO! REMAX, Leaders in real estate.” The Complainant said the statement “Who sells Wellington for the best prices? WE DO!” was misleading as no two houses were the same and a house is only sold once so a comparison was not possible. The majority of the Complaints Board said the advertisement made an absolute claim relating to price, which required substantiation. It said the claim was also comparative in nature and therefore needed to establish grounds for comparison and make that information clear to consumers. It said the advertisement failed to do this and no substantiation was offered by the Advertiser. A minority of the Complaints Board disagreed and said the advertisement contained sufficient information to the let the consumer decide whether the Advertiser offered the “best price.” The minority said that consumers could find comparative information and draw their own conclusions and therefore the advertisement was not misleading. However, the majority of the Complaints Board considered the advertisement was likely to mislead the consumer relating to the lack of premise for the comparison and inadequate substantiation from the Advertiser. It ruled the advertisement was in breach of Basic Principle 4 and Rule 2 of the Code of Ethics. In accordance with the majority, the Complaints Board ruled the complaint be Upheld. [Advertisement to be removed] Please note this headnote does not form part of the Decision. 13/530 COMPLAINTS BOARD DECISION The Chairman directed the Complaints Board to consider the advertisement with reference to Basic Principle 4 and Rule 2 of the Code of Ethics. This required the Complaints Board to consider whether the advertisement was likely to mislead or deceive the consumer and whether the advertisement had been prepared with a due sense of social responsibility to consumers and society. As a preliminary note, the Complaints Board confirmed the Complainant was in commercial competition with the Advertiser, however the complaint before them had an important consumer interest in this instance and therefore the Chairman had ruled the complaint be handled through the consumer complaints process. The Complaints Board noted the Complainant’s concern that the statement “Who sells Wellington for the best prices? WE DO!” was not true, as no two houses were the same and a house is only sold once by one agent. The Complainant said there was no way the selling houses at their “best price” could be measured. Turning to the Advertiser’s response the Complaints Board noted where they said “all Leaders advertising in respect to details of actual sales recorded in our advertisements was, is and always will be strictly correct.” The Complaints Board noted the Advertiser said they conducted “statistical analysis of ALL SALES BY ALL COMPETITORS, (including the Complainant), [which] continues to demonstrate that Leaders get a superior result.” However, the Complaints Board noted the Advertiser did not supply any evidence to illustrate either the claim in the advertisement, or the above claim in their response. The Complaints Board turned to the response from the Media, The Dominion Post, which said “we understand that the information provided to us by our Advertisers is factual and correct; and ask for a source of general data that may be presented in the creative/text.” A majority of the Complaints Board noted the Complainant did not challenge the factual elements of the advertisement which identified the percentage sold above rateable value in Wellington, therefore, the Complaints Board focused on the statement “Who sells Wellington for the best prices? WE DO!” It said the statement was an absolute, superlative statement, in line with precedent Decision 13/047 Appeal 13/020 regarding the claim “Best Price…Best Quality. The Decision stated in part: “The Appeal Board was of the view that the aspiration nature of the phrase, as stated by the Advertiser, did not follow through the television advertisement with clear signposts that “Best Price…Best Quality” was as aspirational statement. Without the aspiration element, the claims required substantiation that the prices were in fact the “best”, or cheapest, as the likely consumer interpretation in this context. The Appeal Board held that the evidence supplied fell short of supporting the strong claim, as the research stated the Advertiser’s prices were generally better but not the “best”. Turing to the Code of Ethics, the Appeal Board was of the view that use of the word “best” in terms of price as used in the television advertisement was not an aspirational claim, and without adequate substantiation, the claim was misleading.” Turning to the advertisement before it, the majority of the Complaints Board said the above precedent was directly applicable to the advertisement before it as it was not an aspirational statement or aim, but a strong claim which required substantiation. The Complaints Board said the statement was comparative in that the Advertiser sold houses for the “best price” 2 13/530 compared to other companies, however, they did not offer any basis for the comparison nor substantiation to this effect. The majority of the Complaints Board said the likely consumer take-out would be the Advertiser sold houses for a higher percentage above their ratable value than their competitors, but noted the advertisement failed to offer the consumer any comparative basis for the claim. The Complaints Board also noted the Advertiser did not supply adequate substantiation to support the absolute claim “Who sells Wellington for the best prices? WE DO!” A minority of the Complaints Board said the claim made in the advertisement was based on factual information which was listed in the advertisement and consumers were free to establish for themselves the comparisons with other advertisers. The minority said the advertisement allowed the consumer to therefore decide whether they thought the Advertiser offered the “best price” and therefore said the advertisement was not misleading. On consideration of the above, the majority of the Complaints Board said the advertisement was likely to mislead the consumer in breach of Rule 2 of the Code of Ethics. It said the advertisement had therefore not been prepared with a due sense of social responsibility to consumers and society in breach of Basic Principle 4 of the Code of Ethics. In accordance with the majority, the Complaints Board ruled to Uphold the complaint. DESCRIPTION OF ADVERTISEMENT The newspaper advertisement for Leaders Real Estate compared the rateable value (RV), with the “SOLD” price of 79 houses in the Wellington region and provided the percentage sold above RV. The advertisement stated, in part: “Who sells Wellington for the best prices? WE DO! REMAX, Leaders in real estate.” COMPLAINT FROM D. PLATT As discussed I would like to resubmit my complaint to the Advertising Standards Authority regarding the Dominion Post advertising placed over a number of dates, including the copy supplied which ran on 29th of June which you already have on file. Leaders Real Estate ran this advertisement knowing it was misleading and continued to run it after they were asked to cease. The claim in the advertising (Who sells Wellington for the best price? We do!) is simply not true and is impossible to prove for the simple reason that no two houses are the same and a house only sells once. This statement is something which is impossible to measure yet Leaders knowingly used the statement in an effort to encourage potential home sellers to list their properties for sale with Leaders. FURTHER FROM COMPLAINANT R. Garlick does not appear to have addressed in any way shape or form the question which formed the basis of our complaint, which was the fact there is no measurable way to justify the claims made in their advertising. He also appears to be a stranger to the truth unless his Alzheimer's has really kicked in (over the 2 years R. Garlick ran his misleading marketing we tried several options to get him to desist -including contacting him directly and lodging 3 13/530 complaints with the Real estate institute and the REAA), I am more than happy to provide evidence of this if you would like. On the other hand I was clearly able to explain and justify 2 of 3 of the points raised in R. Garlicks complaint against Tommy's and I was equally quick to put my hand up and agree we had made an error with 4-5 of the GV figures quoted. None of which made any real difference to the message we delivered. I also completely disagree with R. Garlicks recollection of events, the advertising we ran had the desired effect which was to stop Leaders continuing their intended deceit designed to target potential home sellers, once we achieved this we stopped the advert and haven't run it again. I look forward to R. Garlick finally being held to account by someone. Code of Ethics Basic Principle 4: All advertisements should be prepared with a due sense of social responsibility to consumers and to society. 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). RESPONSE FROM ADVERTISER, LEADERS REAL ESTATE All Leaders advertising in respect to details of actual sales recorded in our advertisements was, is and always will be strictly correct, in contrast to similar copy cat advertisments published by Tommys Real Estate wherein the factual inaccuracy has already been conclusively tabulated. Also, D. Platts 2nd paragraph statement takes further liberty with truth insofar as Leaders believes our claim true and we have never been "asked to cease" publishing that advertisement by any party of authority on account of any alleged or proven misrepresentation. Our only reason for doing so was simply that the "Tommys" subsequent sensationalist version in our opinion has brought that style of marketing into disrepute. FURTHER RESPONSE FROM ADVERTISER, LEADERS REAL ESTATE My complaint about Tommy's advertisment simply addressed the factual errors contained in it as identified. It appears Tommy's do not dispute the factual accuracy of the Tender examples listed in our advertisment. Asa review of Tommys complaint regarding our statement becomes farcical in face of the Tommy's statement implication that they, not Leaders "sell Wellington for the best price" simply on the basis of a limited provision of flawed data. Leaders undeniably sells a significantly greater number of homes, predominantly by Tender, than Tommy's, over the area covered in our advertisment. Our statistical analysis of ALL SALES BY ALL COMPETITORS, (including Tommy's), continues to demonstrate that Leaders get a superior result. (You may recall that our statistical analysis has been previously vetted by Commerce Commission who took no further action on that complaint). 4 13/530 If Asa has a concern for the factual accuracy of specific results purported to have been achieved by a real estate agent, then I have already provided all relevant information in my complaint. If Asa has no such concern and merely wishes to weigh the interpretation of apparently conflicting competitive claims then there is nothing else I can add anyway. RESPONSE FROM MEDIA, THE DOMINION POST Thank you for your letter dated 20 November 2013 regarding the Leaders newspaper advertisements that were published in the Dominion Post. We understand that the information provided to us by our Advertisers is factual and correct; and ask for a source of general data that may be presented in the creative/text (RV information, etc). This was provided. I am happy you consider our Client's explanation if any of the detail queried by Tommy's requires further clarification. 5