The Australian Competition and Consumer Commission (ACCC) has raised concerns over misleading advertising practices during the recent Black Friday sales period.
Retailers were found to have employed tactics that may mislead consumers, prompting the ACCC to flag possible breaches of Australian Consumer Law.
Key Concerns Highlighted by the ACCC
The ACCC identified several problematic advertising practices during its investigation, including:
- Exaggerated “Sitewide” Discounts: Retailers advertised “sitewide” or “storewide” discounts while excluding specific products, which could lead to a misunderstanding about the scope of the sale.
- Questionable ‘Was/Now’ Pricing: Businesses presented discounts based on inflated or inaccurate “was” prices, with some items reportedly selling at the same price outside the sale period.
- Misleading Use of RRPs: Retailers used Recommended Retail Pricing (RRP) to calculate discounts, even if the products had not been sold at the RRP for a reasonable time.
- ‘Up to X% Off’ Claims: Promotions claiming discounts “up to” a certain percentage often applied only to a limited number of items, potentially misleading consumers about the extent of the discounts.
- Disclaimers in Fine Print: Some sales claims were qualified by fine print or disclaimers, which were not prominently displayed and could cause confusion.
ACCC Actions and Next Steps
The ACCC is reviewing data collected before, during, and after the Black Friday sales to determine if businesses artificially increased prices to create the perception of larger discounts. According to Deputy Chair Catriona Lowe, the regulator has already requested explanations from several retailers and is considering further investigations.
“We are further considering some of these examples for investigation and action,” Lowe stated. “In the meantime, we are warning retailers ahead of post-Christmas sales that they must comply with Australian Consumer Law in all the claims they make.”
Industry and Consumer Implications
Under Australian Consumer Law, businesses must not engage in misleading or deceptive conduct or make false representations about the value or benefit of discounts. Penalties for breaches are determined by the Federal Court, with fines dependent on the severity of the misconduct.
The ACCC’s actions aim to promote fair competition and safeguard consumers, particularly during major sales periods such as Black Friday and post-Christmas sales. Lowe emphasised that accurate advertising protects both consumers and businesses that follow the rules.
“We know that many consumers rely on sales to save money when shopping for products, especially during this time of cost-of-living pressures. Retailers must not seek to take advantage of this by misleading consumers,” Lowe added.
What This Means for Jewellers
For jewellers, this is a reminder to ensure promotional strategies align with Australian Consumer Law. Transparent pricing and accurate advertising are key to maintaining customer trust and avoiding regulatory issues. With the ACCC monitoring practices, businesses should keep clear records of pricing histories and disclose any exclusions or limitations in promotional campaigns.
