We have received a number of emails about online store Fishpond withdrawing a children's "activity cube" from sale, citing a pricing error.
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Customers who had ordered the toy were sent an email stating that the company had "found a pricing error" with the product and that their order had been cancelled.
Although annoying, this practice is not illegal. From our free Fair Trading Act report:
“If an item is advertised for sale at a particular price, but you get to the shop only to be told that there has been a mistake and the item is, in fact, more expensive, the trader doesn't have to sell you the item for the advertised price. They are entitled to claim a genuine mistake was made. The Act recognises a ‘reasonable mistake’ which may have got through the checking system, or has perhaps been caused by the actions of a third party. However, if a particular trader is always claiming that a ‘genuine mistake’ has been made, they may be in breach of the Act regardless of their plea."
Fishpond also covers this in its terms and conditions:
"Although we do our best to ensure prices stated on this website are accurate, errors do occur ... Where [this occurs] ... we will not be bound by the incorrect pricing stated, and reserve the right to cancel your purchase."
It also states its right to cancel orders "for any reason" and to cancel purchase agreements even after confirmation, and that it will refund any money already paid.
However, we believe Fishpond’s communication could have been better – and the company agrees. Ben Powles, Fishpond's General Manager, told us the activity cube bungle was the result of incorrect stock file information from a supplier. The company waited until it had a full explanation before responding to customer queries, but he says in retrospect it's clear it took too long. In future it will communicate much more quickly when such incidents occur.
But customers also found it frustrating that there is no number to call when mishaps occur. All communication with Fishpond is conducted online and can take a while: Fishpond's contact page states it will reply within 24 to 48 hours. Powles says that this policy is part of what keeps the site's prices low and its postage free, and is part of its philosophy of "empowering" customers to manage orders themselves. "If you want to cancel an order, you can do it with a button on the website, and your money will be refunded. It's an honour system essentially – you don't have to give a reason to cancel an order."
But when something goes wrong and there's no online communication and no customer service centre to contact, this can appear less "empowering" than careless. One disgruntled customer told us Fishpond's reaction – or lack of – seemed "like an effort to quickly and quietly sweep this under the rug." Others complained about the lack of explanation or ability to communicate with the company.
As one customer told us, "they have no phone number. So I thought I'd try their Facebook page. Whenever a comment was written, they would delete it. This made me (and everyone else) even more frustrated ... Because we weren't just being ignored, but blocked/deleted, it really made me angry and want to take action as it was very unfair."
(Ben Powles told us that some of the comments made were excessively abusive and threatening, and the company has a policy to remove this kind of posted material.)
"If it had been a muck up, I would've been happy for a compromise, but every time I tried to contact them, it never seemed to send, or they just weren't answering."
Fishpond responds that a compromise was made available in that it negotiated with the supplier in question and then put all its available stock on the website for a new price of $49.95, which was still below cost. Fishpond also told us it is putting in additional monitoring systems to catch cataloguing errors before they occur.
The incident serves as a reminder to always read the terms and conditions before making an online purchase and to understand the nature of the agreement you are entering into. Most online sellers will include a clause covering pricing errors.
If you do feel an online trader may have breached the Fair Trading Act, we recommend you lodge a complaint with the Commerce Commission (click on the yellow “Make a complaint” button). Some of Fishpond's customers did exactly that. But the Commerce Commission said it was satisfied by "Fishpond's statement and willingness to rectify the situation" and said it would not be investigating further.
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