KGB Deals overhauls compliance to avoid sanction

KGB Deals has overhauled its compliance procedure in a bid to ward off the threat of a damaging referral to the Office of Fair Trading (OFT) following almost 100 complaints about the company’s advertising in the past six months.

KGB

The daily deals service has increased the size of its digital publishing team to strengthen the validation process that takes place before its offers are published. It has also appointed British Gas senior legal counsel Rupesh Chandrani as its legal director.

All offers placed on the website will include new reference pricing checks, with proof points such as screen grabs of websites, to ensure consumers know the the exact time frame in which a deal has been discounted. Where the company cannot identify a discount it now simply states a price with no previous reference point.

Deal adverts will also be checked by more people to make sure they are in line with advertising regulation and that no mistakes are made.

William Ostrom, KGB Deals’ communications director, says it is hoped the new measures will result in a “dramatic” fall in the number of complaints brought about the company to the ASA.

The ASA has received 90 complaints about KGB Deals’ advertising in the year to date. Of those complaints, the ASA has published 20 formally upheld rulings and 12 informally resolved cases.

The Committee of Advertising Practice (CAP) has also been working with KBG Deals to improve its processes so future promotions do not mislead customers.

Matt Wilson, a spokesman for the ASA, which rules on the CAP codes, says it hopes to see a reduction in the number of complaints but would “consider other sanctions” if not.

The ASA referred KGB’s daily deals rival Groupon to the OFT in December last year, following “repeated breaches” of the advertising code.

Groupon pledged to change its marketing practices following the OFT’s probe and has since seen the level of complaints made to the ad watchdog about the company decline.

KGB Deals says it has also had informal discussions with the OFT to ensure its marketing conforms to the advertising code.

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