New analysis reveals that products whose prices switched on and off promotion at Coles and Woolworths largely did so in sync over the past two years. The findings cover items such as toothbrushes, ice-cream, and frozen pizza, with data showing that in some cases the switch from promotional to full price happens almost simultaneously at Australia's two biggest supermarkets.
Promotional Patterns Under Scrutiny
For example, an Oral-B electric toothbrush kit was advertised at Woolworths for $99.50, reduced from $199, the same full price as at Coles. However, just a week earlier, the same kit was 50% off at Coles and full price at Woolworths. This pattern of alternating promotions is common, according to data from price tracking website CW Scanner provided to Guardian Australia.
The products examined include Dr Oetker Ristorante frozen pepperoni pizza, Blackmores fish oil tablets, Weis mango and ice-cream bars, mini Magnums, and Quilton toilet paper. These represent a sample of many items following this pricing strategy.
Consumer Concerns
Erin Turner, chief executive of the Consumer Policy Research Centre, said, "This is not what competition looks like. When markets work, businesses feel pressure to give customers a great deal all of the time – not every other week." She warned that cyclical pricing could mislead if combined with in-store claims that trick people into thinking they are paying a rare low price.
Data shows Natural Confectionary Co's Juicy Burst lollies often go on sale for $2 at Coles on the same day they revert to $5 at Woolworths. Similarly, 1.25-litre bottles of Coca-Cola have been on sale for $2 at Woolworths while full price at $4 at Coles, often swapping on the same day.
Expert Perspectives
Dr Christina Anthony, a consumer behaviour expert at the University of Sydney, said the tactic is "commercially rational" and not necessarily collusion but noted it could erode transparency. Andy Kelly from Choice said "High/Low" pricing has a "huge impact" on consumer behaviour and may skew perceptions of value.
The ACCC's final report on the supermarket industry noted that cyclical pricing means products can be on promotion up to 26 weeks a year at Woolworths, while Coles' policies cap specials at half the year.
Coles responded that factors like seasonality and customer purchase cadence influence promotions, while Woolworths stated that suppliers influence timing due to stock requirements. Both said they have no visibility of each other's future pricing.
Professor Gary Mortimer from Queensland University of Technology noted that suppliers often drive such pricing to maintain market leadership, funding promotional campaigns that rotate between supermarkets.
