Budgeting / 29 May 2017, 09:13am / Georgina Crouth
One of my friends is the ultimate shopper: she was ahead of the queue when the online marketing service Groupon arrived in South Africa and always seemed to land the best deals.
The trips to Thailand, rock-bottom prices for accommodation in Portugal, the never-ending beauty salon visits, the plastic container collection and pot sets that are the envy of people ten times above her salary bracket.
It might be a talent, but bargain-hunting’s not for everyone; although, let’s face it, landing a great deal is rather pleasing to the soul.
Groupon’s business model wasn’t sustainable and it shut its virtual shop in November last year, which put a halt to the daily discount reminders and all those cheap teeth whitening treatments, luxury facials and extravagant getaways ordinarily out of reach for most of us.
But e-commerce shouldn’t mean selling discounted goods at prices that put suppliers at financial risk.
One such business is loot.co.za - a site where you can find everything from electronic goods and DIY supplies to books and music. It’s a simple enough process, whereby you source goods, add them to the virtual cart and proceed to checkout.
A reader, Soraya Dollie, told me she went through the checkout process with Loot over a weekend, paid for a device, but then they contacted her to say the deal was off because the price she paid was incorrect. They offered to refund her money and give her a R50 voucher.
Dollie thought it was a done deal, having bought a Lenovo tablet for the great price of R800. Days later, Loot informed her that the pricing was incorrect.
That Monday, Loot contacted her, saying, “We are very sorry to advise that we have discovered that unfortunately, the pricing information and data that was linked together for the Lenovo (tablet) was incorrect. This resulted in the incorrect price being linked to this item, which we have since corrected. We regret that we are unable to supply the item at the incorrect price and apologise profusely for this. We have therefore had to cancel your order. We have credited the R826 to your credit card
“It was an obvious error as the original price of this item is over R1 000 which has been updated on the site. We do understand that this is inconvenient but we are unfortunately unable to source this item from our supplier at that price.
“As a token of our apology, we’ve created a R50 voucher for you to use on your next order. Please accept our sincere and humble apologies for causing you any disappointment or inconvenience.”
Dollie wasn’t persuaded, feeling they should honour the order because her money had already been accepted.
Had it been a physical store, and she’d completed the sale, that would have been the end of it.
Section 23 of the Consumer Protection Act (CPA) says if there is an obvious/inadvertent error in the price, a supplier will not be bound by the price if the error has been corrected and/or (the supplier) has taken steps to inform customers.
I contacted Ouma Ramaru, spokesperson for the Consumer Goods and Services Ombudsman, about the matter. She explained that certain sections of the CPA do not apply to electronic transactions.
"In terms of the common law, a contract normally comes into effect where there is an offer that is accepted. Some (argue) the same rules apply to e-commerce transactions, namely that the website owner is merely inviting offers from members of the public and it is the customer who makes the offer. (So), if a website owner made a mistake regarding price, it would not be binding - the website owner needs only to refuse the offer...
“(The) widely held view is that by clicking on the ‘I accept’ button, the transaction becomes binding. This is, however, only true if the parties have not reached an agreement on when exactly the agreement becomes binding. We therefore need to look at the terms and conditions provided prior to entering into the agreement.”
Those troublesome Ts and Cs. I consulted Loot’s website and, sure enough, under “Prices” it said, “Though we endeavour to ensure that the prices displayed on the website are accurate, we offer several million products for sale at any time and it is impossible for us to monitor the prices of all individual products manually.
“While we go to lengths to ensure that the prices we display are accurate, we are reliant on our suppliers for providing accurate pricing information and, as a result, it is possible that erroneous prices may be displayed from time to time. In such cases, we shall not be obliged to sell the product at the erroneous price, and will correct erroneous prices as soon as we become aware of them. Displaying a price on the website does not constitute any undertaking by us to maintain that price for any length of time. We will always endeavour to complete your order at the price quoted at the time the order was placed, but in cases of erroneous pricing or where our suppliers deplete their reserves of specially priced stock, we may cancel all or a portion of your order and fully refund any advance payments that you have made toward the affected products.”
Ramaru also raised the possibility of “snatching a bargain”, saying where the buyer is “alive to the possibility of a mistake”, he/she has a duty to speak up or question it because a reasonable person should have realised there is an error and would not have been misled.
I’m not sure many “reasonable” people would have realised that R800 tablet was actually worth over R1 000, but Loot’s covered itself in the terms of sale.
Never simply tick “I agree” when signing a contract. Read those Ts and Cs. Whether it’s for online retail, a gym contract, timeshare, car rentals, or to access loans online from “loan providers” that falsely claim to source a loan but then end up hooking you into a year-long contract where you’re actually paying for “paralegal services”. It doesn’t require a law degree or any special expertise - the CPA makes plain language compulsory in all consumer agreements - and taking the time will only save you grief down the line.