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Supermarket rivals Foodstuffs and Woolworths battle over savings

Author
NZ Herald,
Section
Business,
Publish Date
Wednesday, 10 October 2018, 3:09p.m.
Foodstuffs took Woolworths to the Advertising Standards Authority over one of its Countdown mailers. Photo / File
Foodstuffs took Woolworths to the Advertising Standards Authority over one of its Countdown mailers. Photo / File

Supermarket rivals Foodstuffs and Woolworths have battled it out at the Advertising Standards Authority court over misleading prices and savings.

Foodstuffs, who own Pak'nSave and New World, complained to the ASA about a 32-page Countdown mailer they said was misleading customers over savings they could get from the advertised discounted products.

The mailer, for the week from May 28 to June 3, promoted "1/2 price week on selected promotions". Of the roughly 270 items listed in the mailer, 47 of them were promoted as half price.

Foodstuffs said the mailer advertisement was misleading in four ways:

• the implied usual price of products was in many instances not genuine as it is too old or rarely used

• the main "1/2 price" message was significantly diminished by the fine print

• the fine print was too inconspicuous and too small

• that the saving is for "one week" is misleading because some products do not return to their usual prices at the end of the promotion week but remain at the discounted price.

Foodstuffs said by leading customers to believe they will be achieving some sort of saving off a price that wasn't genuine, Woolworths were exploiting the lack of knowledge that consumers have about pricing because they cannot know the non-promotional price.

Countdown-owned Woolworths said the mailer (with the exception of the Cadbury Novelty Bar) was not misleading or deceptive as it genuinely offered at least 50 per cent off the non-promotional price of the products advertised.

In relation to the savings customers could get, Woolworths said many factors needed to be considered when assessing the accuracy of save statements and the context for them, including the frequency of purchase, the time of year, the pricing history including frequency and multibuy, regional price variation and One Card promotions.

Woolworths also pointed out that there was no law or obligation that the price of a half-price promotional product must be returned to its non-promotional price immediately after the promotion ends.

The authority ruled – with the exception of the Cadbury Novelty Bar, which Woolworths admitted shouldn't have been part of the mailer – Woolworths had not misled customers and did not uphold Foodstuffs' complaint.