Online retailer Kogan has landed in hot water following accusations of purposely misleading customers. The Australian brand has over 1.4 million active customers and is known for selling fashion and accessories as well as furniture, toys and electronics.
Kogan promoted a 10 percent off sale through texts and emails to customers, dubbed TAXTIME, but was found to be making false advertising claims about these products. The retailer was marking up prices, by 10 percent and over, and then adding the discount – tricking customers into believing they were making a saving.
“We allege that Kogan’s advertisements were likely to have caused consumers to think they were getting products below their usual prices. In fact, Kogan had inflated product prices, which we say created a false impression of the effective discount,” said Sarah Court, ACCC Commissioner.
The breach took place in late June of 2018 and saw over 600 products received price inflations, breaching Australian consumer laws.
“Businesses must not make claims to consumers about discounts or sales unless they are offering genuine savings,” concluded Court.
The ACCC is following Kogan for a collection of penalties, corrective notices, costs and injunctions following the breach in standards.