foodpanda in S'pore warned about 'misleading' ad claiming 'unlimited free delivery' for pandapro subscribers

The Competition and Consumer Commission of Singapore (CCCS) has issued a warning to food delivery platform foodpanda regarding a misleading advertisement for its pandapro subscription service.

CCCS said in a Nov. 20 release that while the advertisement promised “unlimited free delivery on all restaurants” for pandapro subscribers, more than 40 per cent of their transactions still included a residual delivery fee.

Ad promised "unlimited free delivery" for pandapro subscribers

The advertisement was part of an advertising campaign for pandapro, that ran from Jul. 1 to Sep. 30, 2024.

It was displayed across multiple platforms including foodpanda’s app, Instagram page, and on public signages.

In August 2024, CCCS commenced an investigation after receiving a complaint on the advertisement.

"Without any qualifiers, it could mislead consumers into thinking that pandapro subscribers would enjoy free delivery on all restaurants available on foodpanda," CCCS said.

In reality, the regulatory body found that pandapro subscribers only received a S$3 discount on their food delivery fees for all restaurants, or a discount of up to S$6 for selected restaurants.

CCCS added that over 40 per cent of food delivery transactions made by pandapro subscribers during this period required a residual delivery fee to be paid after the discounts were applied.

foodpanda to refund pandapro subscribers, review marketing materials

CCCS said that following the investigation, foodpanda has acknowledged CCCS’s concern.

It will provide a full refund of subscription fees to customers who subscribed to pandapro from Jul. 1 to Sep. 30, 2024.

The platform will also provide clarification to such subscribers and the public on the terms of the pandapro subscription, and review its existing and future marketing materials for pandapro to ensure compliance with Singapore’s fair trading laws.

Businesses must ensure "free" claims are not misleading: CCCS

CCCS said businesses must ensure that any representation about the price of its goods or services as “S$0” or “free” is not false or misleading.

If there are qualifiers, exclusions or incidental costs, these must be stated prominently together with the “S$0” or “free” claim.

A generic disclaimer such as “terms and conditions apply” is not usually sufficient, CCCS added.

CCCS’s chief executive Alvin Koh noted that it is not unreasonable for an average customer to understand that a "free" service means that nothing will be charged.

"It is crucial that businesses ensure that their claims are accurate. Transparent pricing is crucial for consumers to make informed purchases and to allow all businesses to compete fairly,” Koh said.

CCCS advised members of the public who encounter similar cases of unfair trade practices in advertisements to contact the Advertising Standards Authority of Singapore (ASAS) at https://asas.org.sg/feedback/online-complaint or call 6461 1888.

foodpanda response

In response to Mothership's queries, a foodpanda spokesperson acknowledged that the terms and conditions required for pandapro subscribers to enjoy free delivery could have been communicated more clearly.

"Following customer feedback and an inquiry from the CCCS that the benefits advertised did not meet their expectations, we are reaching out to all new customers who subscribed to pandapro during the campaign period to offer refunds on a no-questions-asked basis, and to better illustrate the campaign's terms," the spokesperson said.

The spokesperson added that foodpanda has since taken steps to improve their communication and ensure that all future campaigns are clear.

"We remain committed to listening to our customers and delivering the best possible service," the spokesperson concluded.

Top image from CCCS