September 23rd 2024.
The Australian consumer watchdog has recently filed separate lawsuits against Woolworths and Coles in the federal court, accusing them of deceiving their customers with misleading discount campaigns involving hundreds of products. According to the ACCC, the supermarkets hiked up the prices of these products by at least 15% for short periods of time before including them in their ongoing discount promotions, such as "Prices Dropped" for Woolworths and "Down Down" for Coles.
The ACCC claims that this tactic made the discounted prices appear lower than the artificially inflated prices, but in reality, they were the same or even higher than the original price before the price spike. ACCC chair Ginda Cass-Gottlieb stated that after years of marketing campaigns, Australian consumers have come to expect that these promotions mean a sustained reduction in regular prices. However, in the case of these products, the lowered prices were not actually discounted at all.
The watchdog also alleges that both Woolworths and Coles had planned to include these products in their discount promotions even before the price spikes occurred. In total, the ACCC claims that 266 products from Woolworths and 245 products from Coles were affected by this misleading conduct.
Some of the products involved in the lawsuits include popular brands like Arnott's Tim Tams biscuits, Dolmio sauces, Doritos salsa, Energizer batteries, Friskies cat food, Kellogg's cereal, President butter, Listerine mouthwash, Moccona coffee capsules, and more. The ACCC also claims that these supermarkets sold tens of millions of these affected products and earned significant revenue from their sales.
The ACCC is seeking various penalties and orders from the court, including community service orders to fund meal deliveries to those in need. In response to the lawsuits, both Woolworths and Coles have released statements acknowledging the ACCC's actions and stating their intent to cooperate with the watchdog.
They also emphasized their commitment to providing value to their customers and maintaining compliance with the Australian Consumer Law. Coles also mentioned that during the period of alleged misconduct, there were significant cost increases from suppliers and within their own operations, which resulted in an increase in retail prices.
The ACCC's allegations highlight the importance of transparent and accurate pricing and discount claims in allowing consumers to make informed choices about their purchases. It also serves as a reminder to companies to prioritize compliance with consumer laws and to build trust with their customers.
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