Foodpanda offers refunds to new Pandapro subscribers following CCCS warning about misleading ad

Foodpanda said on Wednesday (Nov 20) it will offer refunds to those who recently signed up for the Pandapro plan.

The spokesperson told AsiaOne that the food delivery platform will contact all affected subscribers to offer refunds on a no-questions-asked basis.  

This comes after the Competition and Consumer Commission of Singapore (CCCS) issued the food delivery platform a warning for its misleading advertisement. 

Foodpanda's campaign, which ran from July 1 to Sept 30, promised "unlimited free delivery on all restaurants" to those who purchased a Pandapro subscription, which starts from $4.99 a month. 

The advertisement was displayed across multiple platforms, including the company's Instagram page, its in-app marketing as well as billboards and signages at public areas, said CCCS.

The lack of qualifiers in the campaign could mislead consumers into thinking that Pandapro subscribers would enjoy free delivery on all restaurants available on the app, the commission added.

However, Pandapro subscribers only received a $3 discount for all restaurants, or a discount of up to $6 for selected restaurants. 

After receiving a complaint about the advertisement, CCCS launched an investigation.

The commission found that Pandapro subscribers still had to pay residual delivery fees for more than 40 per cent of food delivery orders during the campaign period. 

Following the investigation, Foodpanda has acknowledged CCCS' concern and has agreed to provide a clarification about the terms of the Pandapro subscription. 

"We have since taken steps to improve our communication and ensure that all future campaigns are clear," said the Foodpanda spokesperson.

In its statement, CCCS also reminded businesses that when absolute terms such as "free" are used in advertising, any qualifiers, exclusions and incidental costs must be stated prominently. 

A generic disclaimer such as "terms and conditions apply" is not usually sufficient, it added. 

When a business offers "free" services to entice a person to try a service, it is not unreasonable for an average consumer to understand "free" to mean that nothing will be charged, said CCCS' chief executive Alvin Koh. 

"Transparent pricing is crucial for consumers to make informed purchases and to allow all businesses to compete fairly." 

On Wednesday, the Consumers Association of Singapore (Case) said that it supports the CCCS' enforcement actions.

"Businesses must be held accountable for accurate and transparent advertising practices, so that consumers can make informed purchase decisions.

"As such, we advise businesses to state qualifiers clearly and visibly to avoid confusing or misleading consumers," said Case president Melvin Yong.

Those who wish to give feedback on unfair trade practices in relation to advertisements can contact the Advertising Standards Authority of Singapore.

claudiatan@asiaone.com