Free trial offers: how to avoid getting burnt

free trialCompanies sometimes offer free trials in an attempt to entice customers to sign up to a service or to buy a product they’re not familiar with. Trials are prevalent in the services and cosmetics industry where customers are offered free access to test products or given vouchers for a limited period. For example, most gyms give consumers a week or a month’s trial period after which you can decide if you want to enter into a contract.

These are meant to convince you that the product or service is one that you can’t live without. They’re completely legal but some salespeople may sign you up for more than you bargained for.

“While free trials are generally an excellent way to allow the customer to first experience the product or service before making a purchasing decision, we do find that in some industries salespeople can use them to lure or mislead customers to enter into long-term contracts while thinking that they are just signing up for a trial period,” points out Magauta Mphahlele, acting ombudsman of the Consumer Goods & Services Ombud. “We have seen this in the gym industry where sales agents are incentive based on the number of consumers they sign up.”

If you’re keen on trying something different but are not sure that it’s right for you, here are some tips to ensure that you’re not swindled or forced into a contract or other type of commitment just for sampling the offering.

Know your rights

“Suppliers are not allowed to lock consumers under any contract based on false and misleading representations. The Consumer Protection Act caps fixed-term contracts to two years unless the supplier can prove that entering into a contract longer than two years will be of financial benefit to the consumer,” says Mphahlele.

She adds: “The words “free trial” cannot under any circumstances be construed to mean anything else other than that the product or service is offered on a free trial basis without any conditions attached to it. If any conditions are attached to the free trial these must be disclosed to and accepted by the consumer.”

Look out for unfair terms and penalties

“In general, you should look out for terms like exemption clauses (where a supplier tries to limit or exclude its legal liability or the consumer gives up their rights), unfairly one-sided terms (such as those which give unilateral powers and rights for the supplier or remove a consumer’s rights), terms that create presumptions (such as those which create the presumption that you received all statements) and excessive penalty clauses. These kinds of terms, or terms that have the same purpose or effect as these terms, are presumed to be unfair,” says PJ Veldhuizen, managing director of law firm Gillan & Veldhuizen Inc.

Insist on quality of service/product

The person or company that offers the free trial must ensure that there is sufficient supply of the free goods or services to meet the expected demand. “The supply or capacity must not be limited unless paying customers are limited in the same way and the consumer must not be expected to accept inferior-quality goods or services as a result of the promotional offer. In other words, there must be no discrimination in terms of the quality or quantity of the goods and services because someone is on a free trial,” explains Veldhuizen.

Know that you have a right to cancel

If you do enter into an agreement, remember that you have the right to change your mind (within reason). The Consumer Protection Act allows you to return goods or cancel an agreement under the following circumstances:

  • Without penalty: This is allowed if the purchase of the goods or services was as a result of direct marketing and you cancel within five days after entering into the contract or the goods being delivered to you. “The supplier is obliged to inform the consumer of the right to cool off and is prohibited from leaving any goods with the consumer unless the goods have been paid for. Any goods not paid for and left with the consumer would be treated as unsolicited goods which the consumer would be under no obligation to pay for at a future date,” says Mphahlele.
  • With a penalty, provided notice is given in the right time: In terms of section 14 of the CPA you can give 20 business days’ notice to cancel at any time but the supplier is allowed to charge a reasonable penalty. “This would only apply if the contract is valid,” adds Mphahlele.

This article first appeared in City Press.

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