ACCC slams Coles and Woolworths over misleading prices and discount schemes
- Replies 31
As we navigate the aisles of our local supermarkets, we trust that the prices displayed should be competitive and honest.
However, recent developments have cast a shadow over trust towards retail giants Woolworths and Coles.
The Australian Competition and Consumer Commission (ACCC) took a bold step by initiating legal action against these household names, accusing them of misleading consumers.
The ACCC's allegations claimed that Woolworths and Coles used practices that duped shoppers into believing they were getting better deals.
According to the watchdog, hundreds of products in these supermarkets' discount promotions did not reflect a genuine price drop.
These products were mostly food and pantry staples found in many homes.
Supermarket items were allegedly sold at regular prices for up to six months, then artificially inflated prices by at least 15 per cent.
After the artificial inflation, the prices are then advertised as 'Prices Dropped' at Woolworths or 'Down Down' at Coles.
This practice, if proven true, could have misled countless Australian consumers amid the cost-of-living crisis.
'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' ACCC Chair Gina Cass-Gottlieb stated.
'However, in the case of these products, the 'Prices Dropped' and 'Down Down' promotional prices were actually higher than, or the same as, the previous regular price.'
'Cost-of-living pressures remain a key issue for millions of Australians who shop with us every week,' Woolworths CEO Amanda Bardwell said.
'Our customers are telling us they want us to work even harder to deliver meaningful value to them, and it's important they can trust the value they see when shopping in our stores.'
'We remain committed to offering many ways for customers to save at the checkout,' Ms Bardwell added.
'This includes thousands of weekly specials, everyday low prices on household essentials, a great-value Woolworths brand range and our Everyday Rewards program.'
According to the retail giant's statement, it attributed the significant cost inflation to price increases from its suppliers.
'Coles sought to strike an appropriate balance between managing the impact of cost price increases on retail prices and offering value to customers,' the supermarket's statement wrote.
Consumer group CHOICE welcomed ACCC's actions towards the retailers.
'Promotional labels at the major supermarkets often confuse shoppers, and the frequent changes in prices make it difficult to tell whether there is a genuine discount or not,' CHOICE Director of Campaigns Rosie Thomas said.
'Earlier this year, our nationally representative research revealed that on average one in four people found it difficult to identify if certain supermarket labels represented a true discount,' Ms Thomas added.
The ACCC's current legal action should hold Woolworths and Coles accountable and deter other companies from engaging in similar practices.
The timing of this lawsuit coincided with a proposal that could impose stricter penalties on large supermarkets that mistreat suppliers.
The ACCC's actions serve as a reminder to scrutinise supermarket deals constantly.
Have you ever been misled by supermarket pricing before? What are your thoughts on this issue? Share your experiences in the comments below.
However, recent developments have cast a shadow over trust towards retail giants Woolworths and Coles.
The Australian Competition and Consumer Commission (ACCC) took a bold step by initiating legal action against these household names, accusing them of misleading consumers.
The ACCC's allegations claimed that Woolworths and Coles used practices that duped shoppers into believing they were getting better deals.
According to the watchdog, hundreds of products in these supermarkets' discount promotions did not reflect a genuine price drop.
These products were mostly food and pantry staples found in many homes.
Coles and Woolworths have been selling products with misleading discount tags confusing shoppers. Image Credits: Shutterstock/Daria Nipot, Haireena
Supermarket items were allegedly sold at regular prices for up to six months, then artificially inflated prices by at least 15 per cent.
After the artificial inflation, the prices are then advertised as 'Prices Dropped' at Woolworths or 'Down Down' at Coles.
This practice, if proven true, could have misled countless Australian consumers amid the cost-of-living crisis.
'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' ACCC Chair Gina Cass-Gottlieb stated.
'However, in the case of these products, the 'Prices Dropped' and 'Down Down' promotional prices were actually higher than, or the same as, the previous regular price.'
Woolworths Group expressed its intention to review the claims and work with the ACCC.'Cost-of-living pressures remain a key issue for millions of Australians who shop with us every week,' Woolworths CEO Amanda Bardwell said.
'Our customers are telling us they want us to work even harder to deliver meaningful value to them, and it's important they can trust the value they see when shopping in our stores.'
'We remain committed to offering many ways for customers to save at the checkout,' Ms Bardwell added.
'This includes thousands of weekly specials, everyday low prices on household essentials, a great-value Woolworths brand range and our Everyday Rewards program.'
Coles, on the other hand, stated it would defend the proceedings.According to the retail giant's statement, it attributed the significant cost inflation to price increases from its suppliers.
'Coles sought to strike an appropriate balance between managing the impact of cost price increases on retail prices and offering value to customers,' the supermarket's statement wrote.
'The recommencement of promotional activity as soon as possible after the establishment of the new non-promotional prices.'
'Promotional labels at the major supermarkets often confuse shoppers, and the frequent changes in prices make it difficult to tell whether there is a genuine discount or not,' CHOICE Director of Campaigns Rosie Thomas said.
'Earlier this year, our nationally representative research revealed that on average one in four people found it difficult to identify if certain supermarket labels represented a true discount,' Ms Thomas added.
The ACCC's current legal action should hold Woolworths and Coles accountable and deter other companies from engaging in similar practices.
The timing of this lawsuit coincided with a proposal that could impose stricter penalties on large supermarkets that mistreat suppliers.
The ACCC's actions serve as a reminder to scrutinise supermarket deals constantly.
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