November 1st, 2013
Note: A TINA.org investigation into DealDash has found that the company is engaged in a widespread deceptive marketing campaign to lure bargain-hunting consumers to an illegal gambling site. Read more about TINA.org’s findings and complaints to the FTC and six state attorneys general here.
DealDash is an auction website on which you can “bid” to win electronics and other such things. What this ad doesn’t make clear is that the bids themselves cost money — $0.60 per bid. And those 60-cent bids add up quick. So quick in fact, you’re likely to lose money, says the website itself.
Barbara, as seen in the ad, won the $1700 TV for $29.95 — but she bid 414 times, says the fine print. Those 414 bids cost her $248.40, so she really paid $278.35 total for the TV. Not a bad deal maybe, but according to the rules of DealDash, had someone outbid her at the last second, she would have been out the $248.40 (unless she opted to buy the TV at retail price). That’s a pretty big risk.
But wait . . . there’s more. That’s not the best part of this ad. Here’s our favorite: According to the fine print, Roseanna bid 761 times on that $349 mixer. Those 761 bids cost her $456.60, plus the “less than $25” she paid winning the auction. So she paid well over $100 more than the $349 retail price for the mixer.
And remember, that was an example DealDash willfully selected for its own advertisement.
Here, from deep within DealDash terms and conditions, is a “very important” statement on the nature of the site (emphasis added):
The following statement is very important for any customer or potential customer of DealDash to read and fully understand before using the service:
By registering and using DealDash you understand that you are likely to spend more money than you may receive in merchandise value. Most customers using the site gain less in merchandise value measured in monetary value compared to the amount of money spent bidding to win auctions. Do not buy bids or spend money on the site if you cannot afford to lose the money. . .
DealDash is convinced that the entertainment value of participating in its auctions is valued and that paying a premium price for this entertainment value compared to shopping at the lowest priced retailer is fair. We do however strive to give as much merchandise value back to our users as we possibly can while maintaining healthy gross margins. Most customers will not win auctions and you are on average unlikely to save money using the Site. . . By using the Service you understand and agree to this statement.
You are likely to spend more money than you receive in merchandise value and most customers don’t win anything. But DealDash doesn’t make any of that clear in its advertisement, instead pitching the “great deals” that are anything but.
What DealDash is really offering is a chance to pay money for things you’re unlikely to receive. Is that such a good deal? Decide for yourself before signing up for DealDash or any such auction website.
This article was updated 6/13/17.
Sometimes termed “mouse print” or, more benignly, “disclosure language”, and presented in miniscule font. It is there to take back every enticing offer made in the ad.