National Advertising Division Recommends T-Mobile Modify or Discontinue Certain TV Commercial Claims for Magenta Max Wireless Service Plan

The National Advertising Division (NAD) of the BBB National Programs recommends that T-Mobile US, Inc.

  • “You get T-Mobile’s price lock guarantee, they will never increase the rates on your rate plan” (the “price lock guarantee” claim).
  • “When you switch your family to T-Mobile Magenta Max, you can get up to $1,000.”
  • “Families [with T-Mobile] save 20% versus AT&T.

The claims at issue, which appeared in two T-Mobile television ads (the “Please Listen” ad and the “Cumpleanos” ad), were filed by competitor AT&T Services, Inc.

“Price lock guarantee” claim

The issue for NAD was whether T-Mobile’s price lock guarantee claim, as it appears in the Please Listen ad, clearly communicates to consumers that T-Mobile’s price lock guarantee refers only to the monthly rate consumers pay for wireless Paying service under the Magenta Max. plan and does not include related taxes and fees.

NAD found that while customers are accustomed to advertised prices of goods being exclusive of sales tax, reasonable consumers do not understand the meaning of “price” in the context of the price lock guarantee claim in the please listen to the advertisement as they refer to the monthly rate of Service related. only and excluding fees and other taxes. Further, the NAD found that T-Mobile’s disclosure is not effective in limiting the claim both in terms of presentation and content.

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The NAD found that the price lock guarantee claim was not supported and recommended that T-Mobile end the “Price Lock Guarantee” claim or modify it to avoid such a message. NAD noted that nothing in its decision prevents T-Mobile from making a more limited demand that it not increase the monthly rate under the Magenta Max plan for talk, text and data services.

The NAD also found that T-Mobile’s Please Listen ad reasonably conveyed the implied message that only AT&T and Verizon had recently imposed price increases and fee increases on consumers for mobile wireless service. Because T-Mobile recently increased the cost to consumers for mobile wireless service, the NAD recommended that the commercial be changed to convey this unsupported message.

“Get up to $1,000 Back” claims

Regarding the claim “if you switch your family to T-Mobile Magenta Max, you can get up to $1,000”, the NAD considered whether the way listening and Cumpleanos ads make it clear that T-Mobile switching customers $ 200 per line for up to five lines of service, or whether a reasonable consumer could remove the message that they are eligible for the full $1,000 regardless of the number of lines switched.

NAD found that both ads reasonably convey the message that a typical consumer who switches to T-Mobile’s Magenta Max plan is eligible to receive $1,000. However, insofar as the advertised offer can only be achieved by a certain class of consumer or under certain circumstances, the class of person or circumstances that claim the maximum level of performance must be clearly and conspicuously known.

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Therefore, the NAD recommended that the claim be amended to make it clear as part of the main claim, or in a similar font size close to the main claim, that the maximum advertised amount can only be achieved by families switching five lines . In addition, the NAD recommended that the disclosures on the screen indicating the material terms of the offer be changed to be clear, conspicuous and easy to notice, read and understand.

“Families with T-Mobile save 20% versus AT&T”

NAD considered whether T-Mobile’s 20% savings claim, in the context of its Cumpleanos ad, conveyed the broad message that all T-Mobile plans offer 20% savings over comparable wireless plans offered by AT&T, or whether it is more limited. Note that such savings are available with the T-Mobile Essentials plan.

NAD found that the Cumpleanos ad reasonably conveyed the message that consumers could save 20% when choosing T-Mobile plans over AT&T and Verizon plans and that the disclosure mentioning the Essentials Plan was not clear and conspicuous to the ‘Claim to limit.

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In addition, the NAD found that because the Cumpleanos ad presented offers for the Magenta Max plan and the Essentials plan mere seconds apart, a consumer would reasonably understand that these offers are cumulative and not two completely different offers for two different plans. NAD determined that the close proximity of the offers would reasonably convey the message that consumers would also save 20% with the Magenta Max plan compared to AT&T.

While the record found that consumers switching 3-4 lines to Magenta Max could save 20%, there was nothing in the record to support the broad 20% savings claim when choosing any T-Mobile plan over all AT&T and Verizon plans . NAD therefore recommended that the Cumpleanos ad be changed to avoid such a message.

In its announcement statement, T-Mobile said it “respects the NAD’s decision.” The advertiser went on to say that it is proud of its price lock guarantee and $1,000 trade-in offer and “believes that the challenged ads appropriately communicated the terms of its offers and plan savings. T-Mobile nevertheless stated that the challenged ads are no longer running and that it as a supporter of self-regulation “considers the NAD recommendations with respect to its future advertising.”

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