Source : Perth Now news
Coles wanted to give customers value for money by offering products at “down down” rates when they were in fact higher than original prices, a court has been told.
Coles is defending claims by the Australian Competition and Consumer Commission that it deliberately misled customers during the “down, down” campaign that first launched in 2010.
Under the scheme, the price of a jar of Coles-brand quince paste was raised to $4.50 from $3 for four weeks before being reduced to $3.15.
Internal emails showed Ed McCutchan, a Coles group category manager, argued for the price of the paste to be held at $4.50 for two weeks instead of four before being cut to the “down down” price.
Garry Rich SC, for the ACCC, put it to Mr McCutchan in Melbourne’s Federal Court on Friday that he wanted the paste to be sold on the new “down down” price as soon as permitted.
“Yes, I wanted to continue offering value to customers on that ticket,” Mr McCutchan said.
“You could have sold the quince paste to customers on a white ticket price of $3.15 and delivered the same value to customers, correct?” said Mr Rich.
“Yes,” replied Mr McCutchan.
Mr Rich then suggested the “down down” promotion was more effective in generating sales than other mechanisms, to which Mr McCutchan agreed.
“And do you agree with me that the reason the down down mechanic was more effective is that the down down tickets told customers that they were getting a discount?” Mr Rich asked.
“That would be one of the reasons,” Mr McCutchan replied.
Asked what the other reasons were, he said there was more “real estate” on shelves for “down down” tickets, drawing shoppers’ eyes to the item supposedly on sale.
The ACCC alleges the supermarket giant deliberately raised prices on thousands of everyday items, before offering discounts at prices higher or equal to the original shelf price across 15 months.
It claims that the “down down” campaign duped shoppers into thinking they were getting a bargain.
On Thursday, the supermarket giant admitted to strong-arming suppliers, threatening to strip products from shelves if they did not accede to the retailer’s demands.
The case before Justice Michael O’Bryan resumes on Wednesday.
