Coles' 'Down Down' promotion, one of Australia's most recognizable campaigns, has been exposed as misleading after a federal court ruling. Justice Michael O'Bryan found that the supermarket giant deceived shoppers by promoting fake discounts, prioritizing commercial interests over consumer trust.
The Case Unfolds
The Australian Competition and Consumer Commission (ACCC) brought proceedings against Coles, revealing how the supermarket manipulated pricing to create the illusion of savings. The 'Down Down' campaign relies on 'was/is' comparative pricing, claiming products are cheaper than before. However, the court heard that Coles tampered with its internal 'guardrails'—rules designed to ensure the 'was' price was genuine—to accelerate promotions.
How Coles Manipulated Prices
In late 2021 and early 2022, Coles faced pressure from supplier price increases and competition from rival Woolworths, which used shorter timeframes for its 'Prices Dropped' promotion. Coles reduced its guardrail requirement from 12 weeks to just four weeks, allowing products to be marked as discounted after only a brief period at a higher price. Consumers noticed and reported items that were supposedly cheaper but actually cost more than weeks earlier.
The ACCC identified hundreds of affected products, from deodorant to butter. Justice O'Bryan stated that the 'Down Down' tickets would not have been misleading if the 'was' price had been maintained for at least 12 weeks. He described a 'race to the bottom' in compliance due to competitive pressure from Woolworths.
Consequences and Industry Impact
Coles faces potential fines of tens of millions of dollars. The supermarket said it is reviewing the judgment. The ruling raises questions about whether 12 weeks will become the industry standard for establishing a 'was' price. Woolworths faces similar ACCC accusations and awaits judgment.
The reputation of Australia's major supermarkets has deteriorated significantly. Once hailed as pandemic heroes, they are now seen as a duopoly that fattens profit margins during high living costs at the expense of shoppers and farmers. The court found Coles contravened consumer law by misleading customers.
In his judgment, O'Bryan noted that Coles put commercial interests above customers, a clear violation of trust. The case serves as a warning to retailers about the consequences of deceptive pricing practices.
