Three major Australian retailers have each paid a penalty of $19,800 after the Australian Competition and Consumer Commission (ACCC) issued them with infringement notices for allegedly making false or misleading representations about their Black Friday sales.
The penalties follow an ACCC review of promotional material from last year’s Black Friday and post-Christmas sales, which raised concerns that some advertisements exaggerated the extent of discounts being offered to consumers.
The ACCC issued one infringement notice each to Michael Hill Jeweller (Australia) Pty Ltd, Global Retail Brands Australia Pty Ltd (GRBA) for its MyHouse store, and Hairhouse Warehouse Online Pty Ltd, which operates the Hairhouse hair and beauty website.
According to the ACCC, the businesses allegedly misrepresented their sale offers, including by advertising ‘sitewide’ discounts that did not apply to all items.
“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,” said Catriona Lowe, ACCC Deputy Chair.
“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.”
Michael Hill, a subsidiary of Michael Hill International Limited (ASX: MHJ), promoted its Black Friday event with the phrase “Member Event 25% off Sitewide,” despite some products not being included in the sale.
The ACCC said this may have misled consumers and potentially contravened the Australian Consumer Law.
MyHouse, operated by GRBA, displayed banners on its website stating “Black Friday Up to 60% Off Sitewide + EXTRA 20% off” and “Up to 60% OFF RRP EVERYTHING ON SALE +EXTRA 20% OFF.”
According to the ACCC, the extra 20 per cent discount was not applied to all products, which could have misled consumers about the true scope of the promotion.
Hairhouse Online received an infringement notice for advertising “SAVE 20% to 50% SITEWIDE” during its Black Friday promotion. The ACCC found that more than a quarter of the products on its website were not part of the discount, undermining the accuracy of the claim.
“Retailers need to ensure that their advertising makes it clear to consumers which products are discounted, and by how much,” said Lowe.
“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 added that the ACCC would continue to monitor sales promotions, especially during major retail periods such as the end-of-financial-year sales, and warned that enforcement action may be taken against businesses that breach consumer law.