Coles and Woolworths face court action over claims of misleading discounting by ACCC
Promises made by Coles and Woolworths to deliver on best prices for cash-strapped shoppers have been called into question by Australia’s consumer watchdog, which claims the nation’s two biggest grocery chains have engaged in misleading discounting.
The Australian Competition and Consumer Commission on Monday said it had launched separate legal actions in the Federal Court against the two supermarkets for allegedly breaching consumer law by misleading consumers through discount pricing claims on hundreds of common grocery products.
Amid the cost-of-living crisis, Coles promoted its long-running “Down, Down” campaign as a lifeline for cost-conscious shoppers struggling to make ends meet as inflation pushed up prices on everyday items.
Woolworths did the same with its “Prices Dropped” pitch.
The allegations relate to products sold by each of Woolworths and Coles at regular long-term prices which remained the same, excluding short-term specials, for at least six months and in many cases for at least a year.
The ACCC claims the products were then subject to price rises of at least 15 per cent for brief periods, before being placed in the Prices Dropped and Down Down promotions at prices lower than during the price spike but higher than, or the same as, the regular price that applied before the price spike.
“Following many years of marketing campaigns by Woolworths and Coles, Australian consumers have come to understand that the Prices Dropped and Down Down promotions relate to a sustained reduction in the regular prices of supermarket products,” said ACCC chair Gina Cass-Gottlieb.
“However, in the case of these products, we allege the new Prices Dropped and Down Down promotional prices were actually higher than, or the same as, the previous regular price.
“We allege that each of Woolworths and Coles breached the Australian Consumer Law by making misleading claims about discounts, when the discounts were, in fact, illusory.”
The claims come amid continued backlash from customers about higher prices for a basket of groceries. Both Coles and Woolworths have faced increased regulatory scrutiny and been forced to front multiple government inquiries into claims of profiteering.
Woolworths was also the biggest loser in Roy Morgan’s latest risk monitor survey, rising a massive 194 places to be the fifth-most distrusted brand in the June quarter. Coles rose a further five places from ninth to fourth-most distrusted.
More to come
#Coles #Woolworths #face #court #action #claims #misleading #discounting #ACCC