The daily deal has become a feature of online shopping in South Africa, with One Day Only, and Takealot.com's Daily Deals sub-site offering deep discounts on popular products.
The two companies advertise discounts, typically upwards of 30%, on 50 or more products each day. The discounted products change daily, and the emphasis is on urgency - campaigns around each site push customers not to miss out on the dramatic, soon-to-disappear deals.
But as consumers have pointed out on websites like HelloPeter.com, the deals are often not as big as advertised, and One Day Only has also been reprimanded – twice - by the advertising regulator last year.
The Advertising Standards Authority ruled against One Day Only in the cases, saying the company distorted the retail prices of products in order to make the discount look greater than it actually is.
One Day Only said that the discounts are based on retail prices determined by the buying team. It said the advertised retail price, on which the discount is based, “does often exclude the short-term marketing specials of other online discount stores” and that they include “where possible a survey of traditional retail stores”.
Takealot includes details on its list prices in its terms and conditions. It says the list price advertised is suggested by the supplier or third-party seller of the relevant product. Where this is not available, “an estimate may be provided”.
Although both One Day Only and Takealot Daily Deals do offer many items at legitimately discounted prices, we found several examples of overstated pricing.
In some cases, the product was available on a competitor sites for the same price or cheaper.
The following are examples of dubious offers on One Day Only:
We also found doubtful Takealot discounts.
In the past, One Day Only has argued that their competitors often match their discounts on the day of the sale. This does not explain how many of the inflated retail and list prices are often in direct conflict with the official supplier websites.
Include in the equation the flat rate of shipping, at least R55 with OneDayOnly, and the discount is further eroded. In some cases, the shipping cost is the discount difference, and in others it brings the product back up to its actual retail price.
One Day Only responded to the offers we identified by saying that “Wherever possible, we take the retail price directly from our suppliers. It allows us to run their products at a discount determined by their list price”.
In cases where the seller is unable to supply a retail price, One Day Only’s buying team does “comparative market research” the day before the deal in order to establish a retail price.
Takealot says that they strive to offer their customers “the best prices that we are able to, however there will be cases when another retailer can offer the product at a lower price.”
It’s clear that until there is legislation governing the advertising of listing prices, the onus rests on users to conduct due diligence on each item, without feeling pressured into the sale.
* Update: The original version of this article mis-stated the price of the Berlinger Haus casserole pot on the official Berlinger Haus website. It is, in fact, available for R499, not R49 as originally reported. Business Insider apologises for the error.
In response to questions from Business Insider on some deal examples, Takealot provided a statement that reads, in full:
At Takealot.com, our goal is always to offer customers great products at great prices. To understand how our RSP is determined it is important to distinguish between the List Price, Normal Selling Price and the Deal Price.
The List Price is the recommended retail selling price suggested to us by the supplier of the relevant product.
The Normal Selling Price is the price that the product is then sold for on the site. This price varies, depending on whether a product is subject to a promotion or if newer versions of a product become available.
The Deal Price falls under our Daily Deal promotions which are run every day on our site. Various products on site are subject to this promotion and are sold at a discounted rate
In respect of Daily Deals and other discounted goods, the discounts are calculated against the List Price and not the normal selling price. We always strive to offer our customers the best prices that we are able to, however there will be cases when another retailer can offer the product at a lower price. Of course the reverse is also true in the instances when our price is lower.
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