The Down, Down program from Coles didn’t offer “genuine” discounts to shoppers, a court has found. Photo: Michelle Kroll.
Supermarket giant Coles misled consumers in its ‘Down, Down’ campaign with promoted discounts that were not genuine, the Federal Court has found.
Under the campaign, prices of various items were increased to the ‘was price’ before they were promoted as discounted.
However, these prices were either the same as or higher than they were before the price increase.
Federal Court Justice Michael O’Bryan was scathing when he handed down his ruling today (14 May) in a major win for the consumer watchdog, the ACCC.
“Coles engaged in conduct in trade or commerce that was misleading [under] Australian consumer law and made misleading representations with respect to the price of the sample products [through the campaign],” Justice O’Bryan said.
He explained that products were not sold at the ‘was price’ for long enough before being discounted, meaning the discounts were “not genuine”.
He said the items needed to be sold at the higher price for “a reasonable period”.
Most items were sold at the higher price for about four weeks and “sometimes less”.
“[The] Down, Down tickets for the sample products would not have been misleading if the products had been sold at the ‘was price’ for a minimum period of 12 weeks, immediately preceding the Down, Down promotion.
“This results in a conclusion that if ordinary consumers were told that the product [had been sold] at the ‘was price’ for a period of 12 weeks immediately before the Down, Down promotion, the consumer would believe that the Down, Down price was a genuine discount to the ‘was price’.”
Justice O’Bryan said consumers wouldn’t have accepted a discount for a product sold at the higher price for less than 12 weeks as being genuine.
Most of the sample products evaluated during the trial were found to be misleading. Photo: Michelle Kroll.
Between February 2022 and May 2023, the ACCC examined 245 products, claiming common items were sold at a certain price for a median of 343 days before being increased for about 28 days.
During the trial, John Sheahan KC, appearing on behalf of Coles, told the court it took about six months for the supermarket to decide a price.
He also said there were frequent changes between February 2022 and May 2023 because of inflation.
Justice O’Bryan said he had taken into account the supermarket’s internal policies around how it set prices.
“Aside from products sold on special or other short-term promotions, the prices that Coles charged for manufactured and packaged products – with which this proceeding is concerned – were relatively stable from month-to-month, with relatively infrequent changes.”
Justice O’Bryan said that 13 of the 14 sample products examined during the trial had fallen foul of consumer law.
The remaining product – a dog food product – passed because no ‘was price’ was listed on the Down Down ticket.
“[The campaign] conveyed a representation to ordinary consumers that Coles had reduced the price of the products, from the ‘was price’, and implicitly that the reduction in price involved a real or genuine discount.”
ACCC chair Gina Cass-Gottlieb welcomed the finding.
“The ACCC brought this case in the public interest because we considered that Coles’ pricing practices within its Down Down program made it harder for customers to identify genuine value for money while shopping for household essentials.”
“We had received complaints by consumers about the Down Down discounting claims made by Coles. We understand how important it is for consumers to get value for their supermarket purchases, and decided to take action to test the discounting practices in court.”
A separate case against Woolworths is continuing, with the ACCC alleging the supermarket misled consumers through its ‘Prices Dropped’ campaign.
The Federal Court will determine penalties at a later date.
Original Article published by Claire Sams on Region Canberra.
