The recent ACCC investigation into 'two price'
advertising concluded that bedding retailer Snooze's October
2008 advertising campaign was in breach of the misleading and
deceptive provisions of the Trade Practices Act 1974 (Cth).
Snooze utilised a 'two price' advertising technique
incorporating a 'was/now' pricing policy. The ACCC audit
revealed that a number of the bedding products offered for sale
under this promotion had been offered for sale or sold by Snooze
for a cheaper price than the published 'was' price. The
Trade Practices Act 1974 (Cth) requires any advertised higher
'was' price must be genuine and have applied to the product
in question prior to the sale for a reasonable period of time.
ACCC chairman Graeme Samuel commented that "two price
advertising can make a sale price seem more attractive to
consumers, but where the 'was' price is false or inflated,
customers can be misled. Such advertising places businesses at
serious risk of breaking the law." Snooze has now admitted
that the advertised 'was' price referred to an internally
recommended retail price and not the actual price the products were
offered for sale or sold for prior to the October 2008
Snooze will now provide a A$50 gift voucher and a written
apology to all Snooze customers likely to have been misled and
deceived as a consequence of the October 2008 campaign.
The ACCC has released 'two price' advertising
guidelines. These guidelines are available from the ACCC website.
Any business considering or participating in 'two price'
advertising is invited to contact Middletons for a consultation if
concerned that their promotion may mislead and deceive its
consumers in breach of the Trade Practices Act 1974 (Cth).
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guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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Franchisors should minimise the risk to their brands by helping their franchisees understand and meet their obligations.
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