ACCC Accuses Coles of Misleading Grocery Prices

Coles, the Australian supermarket giant, faces serious allegations from the Australian Competition and Consumer Commission (ACCC). The ACCC accuses Coles of misleading consumers regarding grocery prices through its advertising campaign. The case commenced in the Federal Court today, focusing on claims that Coles artificially inflated prices before marking them down as discounts.

Details of the Allegations Against Coles

The ACCC’s barrister, Garry Rich SC, presented the opening argument, asserting that Coles’ “down down” marketing slogan, which emphasizes price reductions, is fundamentally deceptive. Rich stated, “Why on earth are you telling your customers that your prices are going down, when they’re not?”

Rich cited the example of a 1.2kg can of Nature’s Gift adult wet dog food. This product had a consistent price of $4 from April 2022 until February 2023. The price reportedly increased to $6 for just one week before reverting to $4.50 during a promotional period. Rich labeled this pricing strategy as “utterly misleading.”

Scope of the Misleading Practices

• The promotional campaigns under scrutiny include “Prices Dropped” and “Down Down.”
• Coles purportedly misled consumers on 245 different products, including common essentials like toothpaste, soft drinks, and laundry powder.
• Coles’ price for the dog food rose to $6 just seven days prior to the promotion, contributing to the ACCC’s allegations.

Justice Michael O’Bryan raised concerns about whether supplier cost increases contributed to Coles’ price changes. However, Rich countered that consumers were not privy to this information, rendering the discount claims misleading.

Coles’ Response to the Claims

Coles is vigorously contesting the ACCC’s allegations as the court proceedings continue. The company is adamant that its marketing reflects genuine pricing strategies aimed at aiding customers in managing grocery costs.

The outcome of this case may significantly impact consumers and the grocery sector. The ACCC’s claims highlight essential issues regarding transparency and truth in advertising within the retail industry.