Coles has defended its “down down” discount campaign, saying grocery shoppers understand they represent “fair dinkum” price reductions.
The retail giant on Tuesday told the Federal Court the public would accept the promotions as price drops, accusing the consumer watchdog of attributing “sophisticated thought processes” to ordinary customers.
In the second day of a high-profile trial, Coles lawyers said its “down down” prices were genuine discounts offered to shoppers after an increase in wholesale costs charged by suppliers during a post-COVID inflation surge in 2022 and 2023.
Coles is fighting claims by the Australian Competition and Consumer Commission that it misled customers by artificially increasing prices before reducing them and claiming shoppers were getting a discount.
The grocery chain’s barrister, John Sheahan KC, said there were two critical questions in the case: what the price tickets conveyed to consumers and were they misleading.
“The ordinary, reasonable consumer would not be concerned with the relative duration of the ‘was’ price in the past,” he said.
“What they would be concerned with when they’re walking down the aisle trying to work out what to buy today for their shopping is whether the claimed discount was … fair dinkum.
“So long as the ‘was’ price is a genuine price, not contrived or ephemeral, then the consumer’s interest is appropriately satisfied.”
Mr Sheahan accepted Justice Michael O’Bryan’s proposition that an ordinary consumer would consider the “down down” campaign to be a promotion.
“I think I can take this as general knowledge, that as you walk down an aisle in a supermarket, and you see different coloured labels, and the fact that a label hangs out lower … it’s a discount of some kind,” Justice O’Bryan said.
Mr Sheahan said the ACCC’s case was “too complex to credibly attribute to an ordinary, reasonable consumer walking down an aisle of Coles”.
It was a genuinely unusual feature of the case that the regulator was attributing “sophisticated thought processes to the ordinary, reasonable consumer”, he added.
“Normally, it’s the advertiser says, ‘oh, well, you know, the consumer could see through that, they take this into account, they’d understand.’ But this is the other way around.
“There are layers and layers of indeterminacy in what they attribute to the ordinary, reasonable consumers’ understanding of this very simple ticket.”
Justice O’Bryan said it seemed the task for the court was to simply to conclude what was conveyed and if it was misleading.
Mr Sheahan said grocery prices often fluctuated, particularly during periods of high inflation, such as 2022 and 2023.
“In the end all prices are temporary – nothing lasts forever,” he said.
The case continues.