The Australian Competition and Consumer Commission (ACCC) is taking action against JB Hi-Fi’s household appliance chain The Good Guys for allegedly misleading consumers about its store credit and ‘StoreCash’ promotions, and failing to provide store credit to eligible customers.
What happened?
The ACCC alleges that from July 2019 to August 2023, The Good Guys ran 116 promotions in which they offered consumers store credit for spending a minimum amount on certain products. The ACCC claims that the electronics retailer misled customers about the conditions for receiving store credit in their promotional materials.
The consumer watchdog’s claims are:
- Poor communication: The Good Guys didn’t clearly explain the conditions for obtaining store credit in its marketing materials. They assert that this led to many consumers to misunderstand the terms of the promotion.
- Opt-in requirement: Consumers were required to opt in to receive marketing communications to be eligible for the store credit. The ACCC alleges The Good Guys didn’t make this condition clear, leading to confusion among customers who did not receive the credit they expected.
- Short expiry periods: The majority of promotions expired quickly, within seven to 10 days, but The Good Guys did not make this clear to consumers.
The proceeding against Good Guys is an important reminder for consumer product companies about ACCC’s commitment to targeting deceptive marketing practices and protecting consumer guarantees by holding retailers accountable for their advertising. The regulator is seeking remedies including consumer compensation, penalties, publication and compliance orders and more.
ACCC Chair, Gina Cass-Gottlieb emphasised, “Businesses should be on notice that promotional conditions must be prominently disclosed to consumers, rather than buried in hard-to-find locations, or they risk enforcement action under the Australian Consumer Law.”
What do consumer product companies need to do?
To avoid getting caught out, ensure your promotional materials, including terms and conditions, are clear and easy to find. Any conditions attached to promotions should be prominently displayed and written in plain language that consumers can easily understand. Regularly review advertising practices to ensure they do not mislead consumers.
Get in touch
CIE Legal is the law firm for consumer products businesses. We advise a wide range of household-name consumer product businesses on advertising compliance reviews, including reviewing promotional schemes for potentially misleading or deceptive representations. You could say it’s our bread-and-butter. Please contact Raph Goldenberg to find out more.
