Retailer admits to misleading advertising campaign

A retailer has admitted that a sale held last year was likely to mislead and deceive customers after the Australian Competition and Consumer Commission raised concerns over its ‘two-price’ advertising.

Snooze, which owns and manages 70 Snooze bedding retail stores across Australia, has admitted that its October 2008 advertising campaign was likely to mislead or deceive customers about the savings they would obtain on its products.

The campaign was what the ACCC refers to as ‘Two-price’ advertising in the form of ‘Was/Now’.

The ACCC raised concerns over the sale after the results of an audit found that a number of Snooze’s bedding products had been offered for sale or sold by Snooze for a cheaper price than their stated ‘was’price.

After it was made aware of the discrepancy, Snooze admitted that the ‘was’ price was in fact a reference to their own internally-set recommended retail prices, and not the price at which the products were offered for sale or sold for a reasonable period immediately before the campaign.

To rectify the situation, Snooze will write an apology letter to customers known to have purchased a product promoted by ‘Was/Now’ pricing during the campaign and offer a $50 gift voucher. In addition to this it has displayed corrective notices in Snooze stores, published an information notice in FB Magazine and established a trade practices compliance program.

“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,” ACCC chairman Graeme Samuel said. “Such advertising places businesses at serious risk of breaking the law.”

“An advertised higher price must be genuine and have applied prior to the sale for a reasonable period of time.”

Customers who consider themselves eligible for the gift voucher and have not heard anything from Snooze by 2 December are being encouraged to contact them on 03 9830 4081.

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