OFT acts on inflated deflated Iphone prices claims

TRADING OFFICERS from the Office of Fair Trading (OFT) have finished an investigation into the marketing practices of a group buying web firm and found them lacking.

Door knockers from the OFT looked at Markco Media, the firm behind Groupola, a group buying website, that "heavily promoted" a low priced Iphone 4 offer, despite having only eight handsets.

Markco Media was found to be using "bait pricing", a low price designed to appeal to shoppers as a lure for new members.

"The OFT's investigation found that Markco Media used 'bait pricing' to promote a sale of Iphone 4s at £99 (normal retail price was £499) to entice consumers to join Groupola and sign up to receive daily email alerts from the company", said the watchdog in a statement.

"Following extensive promotion of the iPhone sale, including via a press release, a national newspaper interview and marketing on Facebook and Twitter, almost 15,000 people signed-up and registered with Groupola for the sale."

The sale took place shortly after this, and while running users were treated to tantalising messages such as the fact the 202 had been bought. The company even proudly announced that 5 million users had attempted to access its webpages during the sale. All fine, until you remember that there were only eight handsets up for grabs.

"People were not informed that there were only eight handsets available and so almost everybody attempting to buy an iPhone 4 at £99 was left disappointed, after incurring time and effort providing personal details to sign up to Groupola", added the OFT.

The misleading behaviour did not stop there and the OFT found that one Groupola employee had gone on Facebook to make anonymous, but gloriously praisefull comments about the firm.

Closing the investigation, the OFT said that the company and its directors had promised to never overmarket any items of which it has little stock, and to steer clear of making non-disclosed puff statements on social notworking websites and blogs. In other words, they just promised not to do it again. µ