The Australian Competition and Consumer Commission has commenced proceedings against Kogan for allegedly making false or misleading representations during a sales promotion.
The online retailer ran a promotion between 27 and 30 June last year where customers could use a 10 percent discount on most products using the code ‘TAXTIME’ as the promo ran just before the end of the 2017/18 financial year.
The ACCC claims that Kogan raised the prices of more than 600 products just before the promotion started, in most cases by at least 10 percent.
“We allege that Kogan’s advertisements were likely to have caused consumers to think they were getting products below their usual prices,” said ACCC commissioner Sarah Court. “In fact, Kogan had inflated product prices which we say created a false impression of the effective discount.”
Kogan also used advertisements that included statements like “48 hours left!” and “ends midnight tonight”. The ACCC claims these ads gave customers the impression that the discounted prices were only available for a limited time, even though Kogan reduced the prices of affected prices shortly after the promotion ended.
“Businesses must not make claims to consumers about discounts or sales unless they are offering genuine savings,” Court added.
The consumer watchdog is seeking penalties, injunctions, declarations, corrective notices and costs from Kogan in the Federal Court.