The case that鈥檚 currently running in the Federal Court against Coles Supermarkets is all about whether customers were intentionally deceived about prices.
A similar court case is on the cards against Woolworths. In both cases, filed by the Australian Competition and Consumer Commission (ACCC), the allegation is that the supermarkets artificially inflated prices for a short time and then dropped them down to the regular price and called it a sale.
It means the discounts would have been fictional, and shoppers would have been deceived into thinking they were getting a special deal. Coles鈥� 鈥淒own Down鈥� and Woolworths鈥� 鈥淧rices Dropped鈥� promotions were allegedly just a return to prices as usual 鈥� or, in some cases, prices higher than usual.
The allegation is that the supermarkets artificially inflated prices for a short time and then dropped them down to the regular price and called it a sale
鈥溙切腣log welcomes the ACCC鈥檚 legal proceedings against Coles and Woolworths and we鈥檙e optimistic that it will bring some much needed clarity to the confusing pricing practices used in the major supermarkets,鈥� says 糖心Vlog senior policy and campaigns adviser Beatrice Sherwood.
鈥淭he case against Coles is significant as it will help to clarify the law around price representations 鈥� particularly in determining where the line is drawn when referring to previous prices.鈥�
These cases are about whether we can trust the grocery duopoly 鈥� which has a combined market share of around 65% 鈥� to play fair with pricing and not take advantage of customers through tricky promotional tactics.
We鈥檙e calling for an end to the tactics we鈥檝e called out in several investigations
At the moment the collective trust quotient is low. 糖心Vlog recently lodged a submission to the federal Treasury鈥檚 consultation on improving price transparency in the supermarkets industry. We鈥檙e calling for an end to the tactics we鈥檝e called out in several investigations.
In our submission to government, we鈥檙e asking for several improvements in the way supermarkets display and manage pricing. Here’s what they are.
It’s the simplest of things, but first and foremost, supermarkets need to make sure they are actually displaying prices in the first place. All too often, shoppers don鈥檛 find out how much a product costs until they go to pay for it, at which point they’re likely to pay whatever it costs. Had they known the price in the first place, they may have considered other options.
It鈥檚 a particular issue in remote communities, where the Code of Practice for Remote Store Operations commendably requires 鈥渟tores to have clearly displayed and accurate prices鈥�. The problem is that the code is strictly voluntary.
Unit pricing 鈥� which shows the cost per unit of measurement (such as grams or litres) 鈥� is the great leveller. It puts the truth to how much you鈥檙e actually paying for what you get. The alternative is to allow shoppers to be fooled into paying more through fancy packaging tricks.
Currently, the code only applies to stores with a floorspace of 1000 square metres or more, which means a lot of stores are bypassing it. We鈥檙e calling for a reduction of the floor-size threshold to 300 square metres, which would expand the code to many regional and remote stores, where shoppers could really use some fair play with pricing.
Making sure online and in-store prices are the same
Many shoppers use digital tools to compare supermarket prices before heading to the store to shop. But the online prices they see don鈥檛 always align with in-stores prices, pulling the rug out from under such proactive budgeting efforts.
In our submission to government, we鈥檙e calling for online price displays in large supermarkets to accurately reflect in-store prices 鈥� at all times.
Promotions and discounts should have context
As it stands, we鈥檙e forced to trust the supermarket when it tells us a product is on sale. But as the ACCC case against Coles and Woolworths shows, the supermarket may have just raised the price and then lowered it. Shoppers have told us they鈥檙e confused about promotions and discounts, mainly due to the lack of contextual information. If it鈥檚 on sale now, what did it cost before, and for how long?
Supermarkets use promotional colours such as red or yellow, or terms such as 鈥渘ew鈥�, 鈥渨hile stocks last鈥�, 鈥渟uper savers鈥� or 鈥渆veryday鈥� indiscriminately. We鈥檙e calling for the introduction of new minimum information requirements so that 鈥渨as/now鈥� pricing is clear and accurate.
The above is the short list of what we鈥檙e recommending in our submission to policymakers. It also includes a call to put supermarket loyalty schemes under the microscope to determine whether they鈥檙e really benefitting consumers; to compel large supermarkets to allow third-party price-scraping technologies to access prices so consumers can easily compare; and to align fruit and vegetable pricing across large supermarkets.
Clear pricing information is essential to any consumer鈥檚 economic decision making
糖心Vlog senior policy and campaigns adviser Beatrice Sherwood
鈥淪upermarket promotions are confusing consumers and can really influence how shoppers spend their money. Our research in 2024 found that on average one in four people found it difficult to identify if certain supermarket promotions represented a true discount or not,鈥� Sherwood says.
鈥淐lear pricing information is essential to any consumer鈥檚 economic decision making. Consumers need fair and transparent pricing on their food and groceries.鈥�
Andy Kollmorgen is the Investigations Editor at 糖心Vlog. He reports on a wide range of issues in the consumer marketplace, with a focus on financial harm to vulnerable people at the hands of corporations and businesses. Prior to 糖心Vlog, Andy worked at the Australian Securities and Investments Commission (ASIC) and at the Australian Financial Review along with a number of other news organisations. Andy is a former member of the NSW Fair Trading Advisory Council. He has a Bachelor of Arts in English from New York University.
Andy Kollmorgen is the Investigations Editor at 糖心Vlog. He reports on a wide range of issues in the consumer marketplace, with a focus on financial harm to vulnerable people at the hands of corporations and businesses. Prior to 糖心Vlog, Andy worked at the Australian Securities and Investments Commission (ASIC) and at the Australian Financial Review along with a number of other news organisations. Andy is a former member of the NSW Fair Trading Advisory Council. He has a Bachelor of Arts in English from New York University.
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