Three major retailers – including Michael Hill – have paid penalties for allegedly making false and misleading representations about their Black Friday sales.
This is according to the ACCC, which confirmed that each retailer paid a penalty of $19,800 after the consumer watchdog issued them with one infringement notice each.
Dozens of retailers were under the consumer watchdog's scrutiny amid last year’s Black Friday and post-Christmas sales events, which identified concerns that the ads misrepresented the size and scope of discounts being offered to consumers.
The ACCC issued one infringement notice each to Michael Hill Jeweller (Australia) Pty Ltd (Michael Hill), Global Retail Brands Australia Pty Ltd (GRBA) in relation to its homewares business MyHouse, and Hairhouse Warehouse Online Pty Ltd (Hairhouse Online) which operates the Hairhouse hair and beauty website.
This is because the ACCC alleged that the businesses were misrepresenting the nature of their sales, including by falsely describing discounts as applying ‘sitewide’.
“We allege these claims misled consumers that all goods in the physical or online store were discounted, or that the discounts were greater than was actually the case,” ACCC deputy chair Catriona Lowe said.
“Advertisements that talk about ‘sitewide’ or ‘storewide’ sales or promise discounts ‘off everything’ should deliver what customers expect, and not be used by retailers to hook consumers under false pretences.”
Lowe added that businesses are legally obliged to accurately describe their sale offers and should not use small point disclaimers to terms and conditions to disguise the real extent of their offers.
“During the EOFY sales, retailers should be aware that we will continue to keep an eye on sales promotions to ensure consumers are not being misled, and retailers may face enforcement action if they make sales representations that contravene the Australian Consumer Law,” Lowe said.
Regarding Michael Hill, the ACCC reported that the jeweller’s online advertisement promoted the sale with the words ‘Member Event 25% off Sitewide’.
“Michael Hill’s statement may have misled consumers, and contravened the Australian Consumer Law, because some of the products in its online store were not part of the sale and were not discounted,” Lowe said.
Homewares retailer GRBA paid its $19,800 penalty after the ACCC issued it with one infringement notice in relation to its MyHouse store’s online Black Friday sale ad which the ACCC alleges was misleading.
The ad displayed on the MyHouse website during the sale included a ribbon banner stating ‘Black Friday Up to 60% Off Sitewide + EXTRA 20% off’; and a large headline graphic stating ‘Up to 60% OFF RRP EVERYTHING ON SALE’ followed by the text ‘+EXTRA 20% OFF’.
“We say this was misleading because the extra 20 per cent discount was not available on all of its products,” Lowe said.
“Retailers need to ensure that their advertising makes it clear to consumers which products are discounted, and by how much.”
As for Hairhouse Warehouse, the retailer paid a fine in relation to its online ad for its Black Friday sale with the statement: ‘SAVE 20% to 50% SITEWIDE’.
The ACCC considered the statement misled consumers that all items on its website would be discounted by between 20 and 50 per cent for the duration of the Black Friday sale, when in fact more than a quarter of the products on its website were not included in the sale offer.
“Businesses that make false discount claims not only risk misleading consumers, they also compete unfairly against other businesses which correctly state the nature of their sales,” Lowe said.