You've seen those bright red "Down Down" signs while grabbing milk or bread. They're designed to make you feel like you're winning at the checkout. But the Federal Court just confirmed what many of us felt in our gut: those "discounts" were often a total sham.
Australia's second-largest supermarket giant, Coles, has been found guilty of misleading shoppers. The court ruled that the retailer engaged in deceptive pricing across hundreds of everyday items. It's a massive blow to a brand that's spent years trying to position itself as the budget-friendly hero of the Aussie pantry. If you feel like your grocery bill hasn't actually dropped despite the stickers, you're not crazy. You were being played.
The trick behind the red stickers
The scam was surprisingly simple. Coles would take a product—say, a bag of dog food or a box of cereal—and hike the price by at least 15% for a very short window. After a few weeks at this new, inflated price, they’d slap on a "Down Down" tag and drop the price back.
The problem? The "discounted" price was often exactly the same as the original price before the hike. Sometimes, it was actually higher.
Justice Michael O’Bryan, who presided over the case, didn't pull any punches. He looked at 14 specific examples brought by the Australian Competition and Consumer Commission (ACCC) and found that in 13 of them, Coles broke the law. The court's logic was straightforward: a discount isn't a discount if the "was" price was only there for a heartbeat to make the "now" price look good.
The 12 week rule
One of the most important takeaways from this ruling is the "establishment period." The court decided that for a price to be considered a genuine "was" price, it needs to be the standard price for at least 12 weeks. Coles was moving much faster than that. They were cycling prices up and down to create a permanent illusion of value.
It's not just about Coles
While Coles is the one in the hot seat today, they aren't the only ones. The ACCC has a similar case running against Woolworths. Between the two of them, they control about 67% of the Australian grocery market. That's a massive amount of power over what we pay for essentials.
This ruling comes at a time when Australians are feeling the squeeze. Grocery prices have jumped more than 20% over the last five years. When people are struggling to pay rent or mortgages, seeing a "discount" that isn't real feels like a kick in the teeth.
What this means for your wallet
This isn't just a slap on the wrist. A class action is already in motion, led by GMP Law, seeking actual compensation for people who bought these "discounted" items between February 2022 and May 2023. If you used a Flybuys card during that time, your data might actually help prove you were overcharged.
Real examples of the price dance
- Pet Food: Prices were bumped up for a few weeks, then "dropped" back to the old price.
- Pantry Staples: Items like breakfast cereals and snacks followed the same pattern.
- The Result: Shoppers thought they were saving money, but they were effectively paying the standard rate—or more.
How to spot fake discounts yourself
You can't always trust the red and yellow tags. Retailers are experts at psychological pricing. They know that our brains stop doing the math the second we see the word "SALE." Here’s how you can protect yourself:
- Check the unit price: Always look at the price per 100g or per kilo. It’s usually in tiny print on the shelf tag. This is the only way to compare different brands or sizes accurately.
- Track your staples: If you buy the same coffee or laundry liquid every week, you'll start to notice when the "standard" price suddenly jumps before a promotion.
- Use independent apps: Tools like Frugl or WiseList allow you to compare prices between Coles, Woolworths, and Aldi in real-time.
- Shop the perimeter: Most of the heavily manipulated "promotional" items are in the middle aisles—processed foods, snacks, and household goods.
What happens next
The court still has to decide on the fine. The ACCC is pushing for significant penalties that actually hurt Coles' bottom line, rather than just being a "cost of doing business."
The government is also looking at supermarket reforms. There's a push for a mandatory Code of Conduct that would give the ACCC more power to fine these giants when they treat customers like ATM machines.
Honestly, the best thing you can do right now is vote with your wallet. If you have an Aldi, a local greengrocer, or an independent IGA nearby, use them. The "Big Two" only change their behavior when they start losing market share.
Keep your receipts. Check your rewards app history. If you shopped at Coles during the 2022-2023 period, keep an eye on that class action. You might be owed a refund for all those "savings" that never actually happened.
