Groupon UK, the ecommerce marketplace beloved of bargain hunters across the land, has been threatened with legal action unless it improves the way it treats its customers following an investigation into its appalling handling of refunds and replacement items.
The threat follows a Competition & Markets Authority investigation, launched in April, which found that in some cases, shoppers are offered Groupon “credits” instead of the goods and services they paid for, in potential breach of UK consumer law.
The CMA has now rifled off a warning letter to the company detailing a raft of misdemeanors the business must now put right – or else.
Among the issues, the CMA is also concerned that the company is failing to ensure that purchased vouchers can always be redeemed within the advertised periods; descriptions of goods and services are accurate; products are in stock and delivered within the advertised timeframes; items are of a satisfactory quality; and customer service is satisfactory when customers contact them about problems
As well as potentially breaking the law, Groupon UK could be in breach of the formal commitments – known as ‘undertakings’ – that it gave to the CMA’s predecessor, the Office of Fair Trading (OFT), in 2012.
As part of these commitments, Groupon UK pledged to ensure information on its website is not misleading and to comply with customers’ legal cancellation and refund rights.
CMA chief executive Andrea Coscelli said: “More people than ever are shopping online, especially over the last year. It is therefore essential that online businesses treat customers fairly and refund them money where due under consumer law.
“Groupon must swiftly step up and do right by its customers if it wants to avoid court action.”
Groupon now has the opportunity to respond to the concerns outlined in the CMA’s letter and to avoid court action by signing further undertakings to address the CMA’s concerns. This may include redress for consumers denied a refund and additional compliance monitoring.
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