The Federal Court of Australia has ruled that supermarket giant Coles misled shoppers with its ‘Down Down’ promotional campaign, in a landmark decision for the retail industry. Justice Michael O’Bryan found that the discounts did not represent genuine savings, contravening Australian consumer law.
The Australian Competition and Consumer Commission (ACCC) brought the case, arguing that Coles engaged in ‘was/is’ comparative pricing that deceived consumers. Between 2021 and 2023, Coles sold 245 products at a regular price for a median of one year, then increased the price for a median of just 28 days before marking them down to a third price that was equal to or higher than the original. The ‘Down Down’ tickets displayed the higher ‘was’ price alongside the new ‘is’ price, but failed to disclose that the ‘was’ price had been in place only briefly.
Justice O’Bryan said that if shoppers had known the ‘was’ prices were so short-lived, they would not have considered the discounts genuine. He noted that Coles had relaxed its internal ‘guardrails’ designed to prevent deception, reducing a required price establishment period from 12 weeks to four weeks in March 2022. This change, he said, was driven by competitive pressure from rival Woolworths, leading to a ‘race to the bottom’ in compliance with consumer law.
The judgment examined 12 sample products, including Rexona deodorant and Coca-Cola, finding 13 out of 14 promotional tickets misleading. Coles argued the price rises reflected higher supplier costs during inflation, but the court disagreed. The ruling sets a precedent for how long a price must be in effect before a discount can be advertised. Coles now faces penalties, with a separate case against Woolworths pending.
