Groupon admonished by UK regulator and told to give full cash refunds to disgruntled customers that need it
Deals website Groupon has been admonished by the UK competitions watchdog over its treatment of customers and been ordered to offer full cash refunds, instead of company credit notes and replacement items, to disgruntled users.
In April this year, the Competition and Markets Authority (CMA) launched an enforcement investigation into Groupon UK and then wrote to the online retailer in August to ask it to sign formal commitments, known as 'undertakings', to address concerns that the retailer was not responding satisfactorily to customer complaints and was not offering full cash refunds when required to do so.
The CMA also highlighted concerns that Groupon was not ensuring the accuracy of product descriptions, that products were not being delivered within the advertised timeframes, and that items sold were not of a satisfactory quality.
Today (11 October), the watchdog has confirmed that Groupon has agreed to its requests and has signed up to the formal commitments, meaning that customers who were owed a refund because they were either unhappy with their products or service will offered one within the next seven days.
We are checking exactly how many customers are due a refund and what action you might need to take to claim your refund. We will update this story when we know more. See our Rights guide for more info on your refund rights.
Customers who weren't given the option of a refund will be offered one within the next 7 days
The signing of the formal commitments also ensure that:
- A notice banner will be placed on the homepage of the Groupon website and app for the next 60 days outlining details on the availability of full refunds.
Any future complaints from customers will be acknowledged within 24 hours and dealt with within 14 days.
- Descriptions of goods and services on the Groupon website and app will be accurate.
- That a new team is set up to investigate deals when a certain number of customers get in touch with Groupon about their purchase.
- Mystery shopping exercises are carried out.
- Orders cannot be placed unless products are in stock and services are available.
It is not the first time Groupon has found itself in trouble with regulators – in 2012 the retailer agreed to change some of its business practices following an investigation by the CMA's predecessor, the Office of Fair Trading. At the time, Groupon pledged to ensure information on its website was not misleading and that it would comply with customers’ legal cancellation and refund rights.
What do the CMA and Groupon say?
Andrea Coscelli, chief executive of the CMA, said: "So much of business relies on trust. It’s essential that people shopping online receive what they ordered and are supported if things go wrong, quickly receiving any refund they are due.
“We welcome that Groupon has now committed to address concerns about customer service issues and ensure it is abiding by the law, so that people can feel more confident shopping online in the future.”
A Groupon spokesperson said: "Groupon has been working constructively with the CMA throughout the consultation process. We are pleased to have resolved the matter and reached a mutually acceptable solution.
"While Groupon has not been found liable for any breach of UK consumer laws, we have undertaken to invite certain categories of customers to request a refund if they were previously unsatisfied with their experience. We view that agreement to be a part of and reinforcing our standing commitment to a great customer experience."