Coles has been found guilty of misleading consumers with deceptive discounts, according to a recent Federal Court decision stemming from a case initiated by the consumer watchdog.
In a ruling delivered this morning, Justice Michael O’Bryan determined that Coles intentionally disguised price increases as discounts as part of its “Down Down” pricing strategy.
Justice O’Bryan stated, “Thirteen out of the 14 ‘Down Down’ signage items examined in the joint liability trial were misleading, as the products were not sold at the advertised ‘was’ price for a reasonable duration.”
Instead, the items were promoted with a “Down Down” label at a price of $4.50.
The consumer watchdog identified numerous products in Coles’ campaign and found that a similar strategy, named “Prices Dropped,” was employed by Woolworths.
During separate court sessions, representatives for the supermarkets defended their pricing strategies, attributing price increases to inflationary pressures and asserting that their discounts were legitimate.
ACCC barrister Garry Rich SC argued during hearings that Coles was trying to avoid losing customers by disguising price increases as discounts.
“Why on earth are you telling your customers your prices are going down? They’re not,” he told the court.
But Coles’ barrister John Sheahan argued “ordinary, reasonable consumers” knew that prices generally trended upward due to inflation.
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