Daily deal sites get a slap on the wrist

Consumer complaints about daily deal websites have halved, according to the Commerce Commission.

Consumer complaints about daily deal websites have halved, according to the Commerce Commission.

The number of complaints across 85 deal websites per month fell to 10 in October and November from an average of 22 complaints between January and June, the commission said.

Consumer Commission competition manager Greg Allan was unsure whether this was due to improvements made by sites or sites handling complaints better.

The regulator initially approached 20 to 30 of the larger daily deal sites at the beginning of the year regarding complaints made by consumers with an eye to re-educating them about consumer law.

It was receiving an average of 22.5 complaints per month, including complaints about sites not disclosing all relevant information in their terms and conditions (e.g. expiry dates on vouchers) and suppliers being unable to supply what was offered due to limited or sold-out stock. Complaints were also often based on consumer error.

More serious breaches of the Fair Trade Act included false advertising. Sites often advertise products at a discounted price from a quoted standard retail price. However, some products had never been sold at that price.

Under the act it is illegal for any business, real or virtual, to mislead consumers, provide false information, or use any unfair trading practices. The commission sent out compliance advice letters, warning sites they were at risk of breaching the law if they didn’t clean up their act.

Allan said all sites have complied with the commission’s request and improved their practices.

Consumers needed to check that all information was disclosed before making a purchase, he warned.

This could include ringing up a vendor and ensuring all terms and conditions are available and approved before clicking "buy".

Allan also advised consumers to do their own research into the validity of sites.

“Query traders to see if there are any blogs, etc, which have been written about the site.”

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