Coles Misled Shoppers With ‘Down Down’ Discounts, Federal Court Finds

Coles misled consumers through its “Down Down” discount promotions in most cases examined by the Federal Court, which found the supermarket chain created the impression shoppers were receiving genuine savings when they were not.

In a judgment delivered on May 14, Justice Michael O’Bryan found Coles engaged in misleading conduct in 13 of the 14 product promotions examined by the Court.

The Australian Competition and Consumer Commission (ACCC) alleged Coles temporarily increased prices on some products by at least 15 percent before promoting them through its “Down Down” campaign. In some cases, the advertised discounts matched or exceeded earlier prices.

The regulator launched proceedings in September 2024, alleging the supermarket made false or misleading representations about the prices of 245 products between Feb. 2022 and May 2023.

Justice O’Bryan found consumers were likely to believe the “Down Down” promotions represented genuine price reductions because of the advertised “Was” and “Now” pricing displayed on tickets in stores.

“If Coles had offered the products for sale at the ‘Was’ price for twelve weeks, the Down Down tickets would not have been misleading,” the judgment said.

Court Says Consumer Loss Remains Unclear

The Court said it was still unclear whether consumers suffered financial loss as a result of the promotions.

Justice O’Bryan noted that if Coles had kept the higher prices for longer periods before discounting them, shoppers may ultimately have paid more.

The judgment also recognised that maintaining higher prices for longer periods may have placed Coles at a competitive disadvantage and may not have been commercially realistic in the supermarket sector.

The Court suggested alternative pricing approaches, including “Every Day Price” promotions or regular “Special” discounts, may have avoided misleading consumers.

The Court will determine penalties sought by the ACCC on a later date.

ACCC Welcomes Judgment

ACCC Chair Gina Cass-Gottlieb said the regulator pursued the case after receiving complaints from consumers about the supermarket’s discounting practices.

“We understand how important it is for consumers to get value for their supermarket purchases, and decided to take action to test the discounting practices in Court,” she said.

“This case has increased transparency and accountability in relation to Coles’ Down Down program.”

Coles Defends Pricing Practices

A Coles spokesperson defended the company’s conduct, saying the case highlighted the need for greater clarity around pricing rules for retailers.

“Our priority has always been, and will continue to be, delivering value to our customers,” the spokesperson told The Epoch Times.

“The Court found that all price increases resulted from supplier cost price increases and were, therefore, commercially justifiable.”

The spokesperson also said retailers needed clearer guidance around minimum pricing periods to avoid future legal disputes.

Coles is Australia’s second-largest supermarket chain and operates more than 840 stores nationally.

The ACCC has also launched separate Federal Court proceedings against Woolworths Group over similar allegations. Judgment in that case has been reserved.