The National Advertising Review Board (NARB) has recommended that T-Mobile US (NASDAQ: TMUS) discontinue the express savings claims:
- “Families can switch and save 20% vs. the other big guys’ plans plus streaming services.”
- “Switch and save versus AT&T (NYSE: T) and Verizon’s (NYSE: VZ) comparable plans plus streaming.”
The NARB panel also recommended that T-Mobile modify its advertising to avoid certain unsupported implied claims.
The underlying National Advertising Division (NAD) case was initiated by Verizon. In that challenge, NAD recommended T-Mobile discontinue savings claims that appeared in a “Save on Every Plan” brochure, two commercials, “Top Three plays of the Day” and “Holidays are Coming in Hot: Families: Save 20%,” a T-Mobile USA press release, and on T-Mobile’s Savings Calculator website.
During the challenge, T-Mobile informed NAD that it had modified the savings claims to explicitly reference streaming services in the claims themselves and modified its disclosures for the savings claim.
The NARB panel’s review centered on whether T-Mobile’s addition of the phrase “plus streaming services,” or “plus streaming,” to its reference to monthly plan costs for Verizon or AT&T (or “the other big guys”), clearly communicates to consumers. The panel explored if T-Mobile’s price comparisons are based on adding to the cost of the competitor’s monthly price plan the cost of optional streaming services. And do they match the streaming services offered for free by T-Mobile with its comparable plans?
In agreement with NAD, the NARB panel concluded that the “plus streaming” phraseology is confusing, unclear, and inadequate to accurately communicate the nature of the price comparison. Further, the panel agreed with NAD that many reasonable consumers will conclude that the promoted savings is based on the cost of the wireless plans without any adjustments for additional benefits.
Based on these findings, the NARB panel recommended that T-Mobile discontinue its express modified savings claims.
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