Singapore – The Competition and Consumer Commission of Singapore (CCCS) has issued a warning to foodpanda for its misleading advertisement in a recent advertising campaign for its “Pandapro” subscription service.
According to a note from the CCCS, the Pandapro advertisement promoted ‘Unlimited Free Delivery on All Restaurants’ for the subscription service which ran from 1 July to 30 September 2024. This was displayed across multiple platforms including Foodpanda’s Instagram page, its in-app marketing, billboards and signages at public areas such as bus stops.
Following this, the commission stated that they commenced an investigation following a complaint on the advertisement. According to the complaint, the promotion promised “unlimited free delivery on all restaurants” for Pandapro subscribers.
For CCCS, given that the ad is without any qualifiers, it could mislead consumers into thinking that Pandapro subscribers would enjoy free delivery on all restaurants available on Foodpanda. In fact, in respect of food delivery fees, Pandapro subscribers only received a $3 discount for all restaurants, or a discount of up to $6 for selected restaurants.
Contrary to the advertised ‘free delivery on all restaurants, CCCS found that over 40% of food delivery transactions made by Pandapro subscribers on all restaurants over the advertising period required a residual delivery fee to be paid after the discounts were applied.
Alvin Koh, chief executive at CCCS, said, “When a business offers ‘free’ services to entice the consumer to try a service, it is not unreasonable for an average consumer to understand “free” to mean 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.”
Following this, CCCS has asked foodpanda to provide a full refund of subscription fees to customers who subscribed to Pandapro during the advertising period. It has also asked foodpanda to provide clarification to customers who had subscribed to Pandapro during the advertising period and the public on the terms of the Pandapro subscription.
Lastly, CCCS has asked foodpanda to review its existing and future marketing materials for Pandapro subscription to ensure compliance with Singapore’s fair trading laws.
